The concept of corporate governance in Australia took on a totally new meaning in 2006, thanks to the efforts of AWB. Consider the ways this happened. Let’s start with bribery – AWB did it on a scale never before witnessed in this or most other countries, paying some $300 million in kickbacks. Let’s continue with the character of the bribes – the regime of Saddam Hussein, not only a five-star dictator but also the head of a country against which Australia had declared war. Now move on to corporate responsibility and culture – some of AWB’s most senior executives and board directors were exposed under oath at the Cole Inquiry as a bunch of incompetents or liars or both, using phrases like “I don’t recall” and “I can’t remember” with a regularity that has probably never been seen before in any Australian corporate investigation. The result is a share price of $2.61, compared with $6 at the start of the year, a potential class action from American farmers, calls for a ban on AWB trading on the US commodity futures and option markets, and possible criminal action against executives and directors. For lessons in how to squander a monopoly, ruin a reputation and shred the rulebook on corporate governance and morality, AWB wins Crikey’s corporate governance award hands down.
2005 winner: Rupert Murdoch’s poison pill extension without reference to his News Corporation shareholders.
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