National Australia Bank, James Hardie and AWB have all had shareholder meetings in the past three weeks. I was there for every minute as these three have been at the heart of the biggest corporate scandals we’ve seen in recent years.
When NAB lost $360 million through unauthorised foreign currency trading in January 2004, almost half the board was gone within 20 months. James Hardie is even more stark as this week’s three resignations leave it with no directors who were dodging asbestos liabilities in 2002.
That’s called board accountability – something which was sadly lacking at the AWB AGM in Melbourne yesterday. Chairman Brendan Stewart was happy to talk about terminating eight executives last year, but he was belligerent when it came to board scalps, gloating that five serving directors had been re-elected by shareholders in 12 months.
Despite slipping $300 million in bribes to Saddam’s regime, the board can’t see what it’s done wrong. Stewart’s address opened with a complaint that AWB was the only one of Saddam’s bribers subjected to a commission of inquiry and then moaned that directors had been exposed to “legal challenge and personal vilification”. Even most of the grain growers agreed when I got up and said they deserved every bit of it and it was staggering they had the hide to turn up.
Here’s the list of long-term AWB directors who were clearly asleep at the wheel but continue to pocket board fees:
Brendan Stewart: Queensland grain grower, director since February 2000 and chairman since March 2003. Has signalled his intention to resign but remains chairman of the nomination committee which has rejected wholesale changes.
Warrick McClelland: Victorian grain grower and AWB director since November 1998.
Christopher Moffet: WA grain grower and AWB director since November 1998 who was re-elected in March 2005.
John Simpson: NSW grain grower and AWB director since November 1998.
Only grain growers in the relevant states can vote these four off thanks to AWB’s constitution which enshrines grower board dominance. The incumbents are hanging onto their jobs by championing the retention of the single-desk when they should be replaced by cleanskins who also support the single-desk.
The board has thankfully proposed a de-merger which will clear the growers off the AWB Ltd board and let them remain on AWB International, which will be exclusively owned by growers. However, they surely can’t put that to a vote until it’s clear what a Rudd Government would do to the single-desk.