Outgoing Bradken chairman Nick Greiner
After predicting last week in Crikey that the forthcoming Bradken AGM would be one of the five most interesting to watch during the balance of the corporate AGM season, we got some serious drama on Friday afternoon when the two directors seeking re-election at tomorrow’s AGM suddenly resigned.
While it wasn’t as bad at the Trade Union Royal Commission press statement on Bill Shorten at 8.17pm on Friday night, Bradken’s 3.48pm statement was designed to miss the Saturday papers, although The Australian’s John Durie picked up the story.
It has been a tumultuous time for the engineering and mining services company, and outgoing long-serving chairman Nick Greiner will face some uncomfortable moments before handing over to his successor Phil Arnall after tomorrow’s AGM in Sydney.
Bradken’s Eileen Doyle and Peter Richards are just the latest ASX directors who have resigned rather than face the ignominy of formal defeat.
Twelve months ago, as Crikey noted at the time, Cabcharge director Rodney Gilmour did precisely the same thing and the proxy votes defeating him have still never been released.
It is one thing to retire before the AGM, as former Newcrest and Orica CEO Ian Smith did a few months before this year’s Transurban AGM, knowing full well that his gender record was potentially going to cause an embarrassing protest vote.
There was nothing in Friday’s Bradken announcement that admitted the truth of the situation — that the proxy votes were against Doyle and Richards.
Here is a list of other examples of directors who resigned just before an AGM to avoid the formality and ignominy of removal from a club where members average 96% in favour when seeking re-election. In every case, the official statement failed to explain the real reason for the resignation.
- David Clarke withdrew as a candidate for the AMP board in 2009, fearing that his role as CEO of Allco when it collapsed would deter investors. The official statement gave no clue about this this.
- Sir Rod Eddington was anointed as successor to Charles Goode as ANZ chair in 2009 but then withdrew after a big protest at Rio Tinto made it clear that his role as an independent director of Allco was a major problem with investors. This was particularly sensitive given ANZ lost money on its exposures to the Allco empire.
- Meredith Hellicar, the James Hardie chairman, withdrew from her re-election bid for the AMP board in 2009 after a damning court judgment against her related to the great asbestos dodge. But you wouldn’t know it from this terse two-line AMP statement at the time.
- John Cassidy resigned the day before the 2004 Hills Motorway AGM due to investor protests about a potential conflict of interest, but the exit statement was all about an excessive workload.
- Peter Kerr resigned from Tattersall’s shortly before the 2005 AGM as investors were most unimpressed that he was a part of a $100 million claim against the company.
Meanwhile, here are the remarkably few examples of 10 actual defeats of directors from ASX 200 boards over the past 15 years:
- John Ducker: Aristocrat, 2004, 2.42% (the former chairman and Labor Right fixer was disendorsed by the board and abandoned by all institutional shareholders);
- Laurie Marshall: AWB, 2004, 22.2% (only the farmer shareholders could vote);
- Trevor Flugge: AWB chairman, 2002, 26.35% (only the farmer shareholders could vote);
- Tony Iannello: Ausnet Services, 2015, 39.46% (China’s State Grid and Singapore Power ganged up against him);
- John Nixon: Atlas Iron chair, 2008, 46.5% (loss of institutional support);
- Solomon Lew: Coles Myer, 2002, 44.83% (was disendorsed by the board);
- Ian Cush: AWB, 2003, 45% (only the farmer shareholders could vote);
- Graham Mulligan and Bruce Allan: Transpacific, 2010, 46.9% (founder Terry Peabody took some revenge against his former colleagues, teaming up with institutions concerned about unrelated governance matters); and
- Brenda Shanahan: AWB, 2003, 48.78% (only the farmer shareholders could vote).