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oh Crikey « Previous | |Next »
May 15, 2003

I see that Stephen Mayne has lost his strong bid to become the first activist director. A big pity. Corporate governance in Australia needs a good shakeup. Who better to kick things along than the Mayne boy.

The institutions are a bunch of wimps. I can only agree with Mayne on that score. The directors re-elected were the very ones who had presided over a massive fall in the capital value of shareholder funds---- "$10 billion on a foreign frolic" as Mayne puts it. The institutions were okay with that loss!

Shame shame shame. I concur with the sentiments from yelled from the back of the meeting. The institutions did not want the Mayne boy to get a directorship.

| Posted by Gary Sauer-Thompson at 8:09 PM | | Comments (2)
Comments

Comments

There was an instructive comment in the 4 Corners episode on the AMP, from some analyst or other. The contemptuous tone was even more instructive.

He said that what happened happened because the directors weren't responsible for their own money in the same way that say the Westfield board is stacked with people who have a vital interest in the decisions they make. He finished with an acid reference to these directors just waddling off to 'have another cup of tea' after presiding over some disaster or other.

But they then spen the rest of the program making it clear that former chief Paul Batchelor was more with feathering his own nest than anything else, inferring a lack of 'eyes on the ball' at crucial times.

It seems a contradiction but I guess the analyst was referring to the bulk of directors owning the bulk of the company, rather than relatively small individual holdings like Batchelor's.

George Trumbull came out of it, if not smelling of roses, then certainly in higher regard than he went into it. Insiders talked admiringly of his 'respect' for the rules and implied his successors were less scrupulous. Batchelor had that look so common with CEOs - one that says 'I am telling you such bullshit and one day you'll find out, but the size of my payout and the quality of my getaway depend on my gulling you until then.. hence my warily confident gaze, my unconvincing dismissals of facts not conducive to my cause and the sense you get when watching me at ease that I'm wound up tighter than a fish's arse.'

That sort of look.

Glenn - I think you (and the analyst) make a good point about directors having their own wealth at risk. Making that a requirement would do more for corporate governance than any of the changes we've seen in the last 15 years (remembering that we went through all of this before in the early 90s after Bond/Skade et. al).

In fact, the recent changes are likely to have the reverse effect by encouraging the continued growth of a class of "professional" company directors who are dependent on directors' fees for their income and therefore are incentivised NOT to upset management (who appoints them and sets their fees) or to get a reputation for being "difficult" that would inhibit their chances of being appointed to more boards.