After being invited in for an audience with new Telstra chair Catherine Livingstone last month, hopes were high for a reformed AGM after the debacle of last year when the formal presentations dragged on for a record 128 minutes, directors weren’t even on the stage and candidates for election did not speak, let alone answer questions.
This was one of the low-points of the Sol Trujillo and Donald McGauchie reign when everyone from customers to shareholders, regulators and the government were simply told how things were by the arrogant monopolists.
Livingstone made some sensible changes at yesterday’s Telstra AGM, such as reducing the formal presentations to just 45 minutes and having all directors sitting on the stage. Indeed, we even spent 15 minutes at the start of proceedings with all directors introducing themselves and explaining their skills and qualifications.
However, yesterday’s AGM was still highly unsatisfactory for most of those attending because of the dross raised from the floor and Catherine Livingstone’s excessively passive chairing.
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An AGM is meant to be about shareholder matters, yet the majority of issues raised yesterday were related to consumers. Punters were allowed to rave on endlessly and some returned to the microphone up to four times pursuing their own personal legal disputes with the company.
As the first woman to chair a top ten company AGM, Ms Livingstone presumably didn’t want to come across as officious.
However, the strategy also served to minimise scrutiny of the board’s performance because Telstra adopted another controversial tactic straight from the Rupert Murdoch playbook.
The idea of a remuneration report is that you have a discreet debate and vote on remuneration issues.
Under previous chair Donald McGauchie, Telstra did precisely that, including a detailed 15-minute presentation from the now-departed Charles Macek in his controversial role as chairman of the remuneration committee.
However, that was all disposed of yesterday and remuneration issues were just thrown in with one great jumbo debate which ranged from the ridiculous to the bizarre.
Even the re-election of six directors wasn’t discreetly transacted, meaning there was absolutely no debate on board composition or performance.
Despite all this talk of Future Fund chairman David Murray necking Donald McGauchie, he wasn’t mentioned from the floor once.
The Telstra AGM started at 9.30am but I only got there at 12.30pm after earlier attending the Oceania Capital Partners and Transfield Services AGMs.
Not realising that there would be no subsequent debate on remuneration and the directors, my only contribution was to recommend we wind up general business at the three hour mark in order to get on with the business meeting.
As part of this one and only visit to the microphone, I lobbed three questions, the cheekiest asking whether Kevin Rudd had ever stayed with Telstra’s chair or CEO in light of his recent overnighter with Kerry Stokes at Cable Beach. Have a listen here.
A few minutes later after three hours of general debate, the proxies for all resolutions were flashed on the screen and then proceedings abruptly ended.
While the whole experience was very frustrating for shareholders who wanted to hold the board to account, it was a PR success for Telstra.
The press coverage today focused on angry shareholders lashing the government, David Thodey saying sorry over customers issues and Catherine Livingstone gently assuring shareholders Telstra would be “tough” over the NBN if necessary.
No one asked Livingstone whether she regretted endorsing any of the Trujillo-McGauchie tactics over the previous five years.
The institutional shareholders clearly had no regrets about Sol’s $3 million termination payment given that the remuneration report was supported by 95% of votes cast and even McGauchie’s staunchest supporter on the board, former CSIRO chairman John Stocker, was re-elected with more than 98% in favour.
At the same time as the meaningless Telstra rave-fest was meandering on at Darling Harbour, across town at the Museum of Sydney we had a cracking Transfield Services AGM with all sorts of interesting debate about retail dilution, punting the auditor, the chairman’s margin calls, those thugs at Leighton, excessive write-downs and the financial position of the much-diminished Belgiorno-Nettis family. All the details are here, yet The AFR, the only paper in attendance, could only muster a couple of paragraphs on the outlook. Bizarre.