Fels, Fiefdoms, and Followers

If you really want to know what the Howard government's next piece of corporate-friendly legislation will be, just watch what the Americans are doing (obviously). Following in the footsteps of recent US media ownership reforms, Alston and Howard moved further on the Liberals plan to crush Australian independent media for the coffers of a rich few. Timely, considering Australia's toughest corporate competition regulator, Allan Fels, handed the reins of the ACCC over to a known 'friend' of big business. Finally, we continue to report on the ongoing saga of big executive payouts, the exercising of unjustifiable and excessive stock options and the exposure of more dubious activities at the big end of town.

PICKS OF THE WEEK

FAI trio in court on dishonesty charges

Former FAI Insurance executives Daniel Wilkie, Timothy Mainprize and Stephen Burroughs appeared in Downing Centre Local Court yesterday in response to summonses issued by the Australian Securities and Investments Commission alleging failure to act honestly.

Full Story: http://www.smh.com.au/articles/2003/07/01/1056825399552.html

Fels in last hurrah

AUSTRALIA'S biggest retailers, Coles Myer and Woolworths, vowed to vigorously defend "vexatious" legal action launched by Allan Fels on his last day as chairman of the Australian Competition and Consumer Commission.

Full Story: http://finance.news.com.au/common/story_page/0,4057,6680568%255E462,00.html

Pokies CEO sues for $12m

The former chief executive of poker machine maker Aristocrat, Des Randall, has launched legal action against the company claiming he is entitled to $12 million in damages and a $900,000 bonus.

Full Story: http://www.theage.com.au/articles/2003/06/30/1056825334876.html

Elliott vows to fight

JOHN Elliott has vowed to fight a court ruling that has effectively buried his once stellar career.

Full Story: http://finance.news.com.au/common/story_page/0,4057,6680705%255E462,00.html

Biggest tax fine of $52m on petrol

Two petrol wholesale companies were fined $52 million yesterday for tax evasion - the biggest penalty of its kind in Australian history.

Full Story: http://www.smh.com.au/text/articles/2003/06/27/1056683912134.htm

ANZ chief banks a nice return from his shares

The most vigorous share trader among directors last week was ANZ chief executive John McFarlane, who sold 650,000 shares, netting himself about $4 million.

Full Story: http://www.theage.com.au/text/articles/2003/06/27/1056683906019.htm

Salary top-ups for those up top continue to be out of whack with performance

In mid-March, the BankWest share price hit a four-year low and the company announced 200 redundancies as part of a cost-cutting campaign. A fortnight later the annual report covering the year to December 31, 2002, showed that managing director Terry Budge doubled his cash pay to $1.4 million.

Full Story: http://www.theage.com.au/text/articles/2003/06/27/1056683905608.htm

Macquarie boss takes a pay cut...However

Macquarie Bank's chief executive Allan Moss has taken a pay cut, but he still received nearly $6 million in total remuneration this year. He remains one of Australia's highest paid executives.

Full Story: http://au.news.yahoo.com/030422/2/joe8.html

Board 'cadetship' for women

DIRECTORS of large companies have been urged to appoint women to their second-tier boards in an apprenticeship-style model.

Full Story: http://www.dailytelegraph.news.com.au/common/story_page/0,5936,6636487%255E704,00.html

Esso gets the bill for gas explosion

ESSO faces an immediate damages bill of up to $1.5 million and hundreds more claims as it battles the legal fallout from the 1998 explosion at its Longford natural gas production plant in Victoria.

Full Story: http://www.dailytelegraph.news.com.au/common/story_page/0,5936,6626638%255E704,00.html

FEEDBACK

Media Ownership

How do you think the governments proposed changes to media ownership laws will affect independent media in Australia?

Media ownership Law as it stands

· Proprietors limited to owning only one radio station or television station or newspaper in the same city.

· Proprietors limited to owning one television station in a market, or two radio stations.

· Foreign ownership of television licences capped at 20 per cent.

· Foreign ownership of newspapers capped at 35 per cent.

Alston's proposed changes

· Proprietors can own two of the three forms of media - radio, television, newspapers - in any one market.

· Foreign ownership limits lifted.

· Commercial television stations must broadcast a minimum level of local content.

· Review of the media ownership and control laws in three years' time. (Source: SMH)

Send in your opinion on this topic or any of this weeks business dealings to: bosswatch@labor.org.au

LEGISLATION NEWS

Finally...

Guidelines released by the Australian Securities and Investments Commission and the Audit Standards Authority will ensure more transparency in the process of disclosing executive option packages and highlighting the role of auditors in financial reporting.

Executive options: time to reveal all

The corporate regulator has stood by guidelines that will force companies to disclose the value of executive share option packages in this year's annual reports.

Full Story: http://www.smh.com.au/articles/2003/06/30/1056825340047.html

Board may ask auditors to tell investors more

Shareholders may find an alternative audit report that offers a clearer explanation of the role of auditors at the back of financial statements after the release of a guidance statement by Australia's audit standards authority.

Full Story: http://www.theage.com.au/text/articles/2003/06/29/1056825275866.htm

Calls to axe competition reforms

BIG business has told the Howard Government it should ditch its whole competition reform package rather than cave in to small business pleas for stronger laws against wrongdoing by big companies.

Full Story: http://www.theaustralian.news.com.au/common/story_page/0,5744,6624412%255E643,00.html

Hear the whistle blow

THE HIH and Enron collapses showed that company boards needed a way to listen to whistleblowers, a senior academic said yesterday.

Full Story: http://www.dailytelegraph.news.com.au/common/story_page/0,5936,6657357%255E704,00.html

INTERNATIONAL

US Excess Continued...

American CEO's at medium-sized companies were paid an average of $US1.18 million ($A1.76 million) last year compared with $US993,000 in 2000. High executive pay at a time when a sluggish global economy has cut profit, and stocks have endured their longest decline since World War II, has prompted investors to protest.

United States chief executives hit the salary jackpot

US chief executive officers' pay rose 19 per cent over the previous two years. In most of the rest of the world, salaries among top management fell.

Full Story: http://www.theage.com.au/text/articles/2003/06/26/1056449365773.htm

WORLD WIDE WEB

Corporate Campaigning

Infact has been exposing life-threatening abuses by transnational corporations and organising successful grassroots campaigns to hold corporations accountable to consumers and society at large since 1977. Infact has been a driving force in US corporate campaigning from the Nestlé Boycott of the 1970s and 80s over infant formula marketing, the GE Boycott of the 1980s and 90s to curb nuclear weapons production and promotion, to the Boycott of Kraft Macaroni & Cheese--a product of tobacco giant Philip Morris. Through broad-based consumer campaigns and Corporate Hall of Shame, Infact have a core of well-trained organisers who lead the grassroots challenge to unwarranted corporate influence.

Go to: http://www.infact.org/

QUOTE OF THE WEEK

"We didn't actually overspend our budget. The allocation simply fell short of our expenditure."

Keith Davis--Author and Business Analyst

For further information

Contact:   Chris Owen