On The Road to Reform

The CLERP 9 reforms are expected to be introduced into the federal parliament this week for debate early next year but the Howard government continues to show signs that it is bending to big business's wishes for a softer approach to corporate law reform. The opposition is sticking with the hard line and is this week challenging the governments plans to limit the rights of consumers to take legal action against companies who use false advertising. Meanwhile, ASIC have been urged to assess NRMA's one-sided ad campaign that failed to mention that by voting yes for the new constitution the results of an earlier vote to elect half of the board become null and void.

WEEK IN REVIEW

ACCC deputy attacks plan to curb rights

Federal Government plans to limit the rights of consumers to take legal action against companies for misleading and deceptive conduct could damage the economy and undermine long-standing legal rights, the new deputy chairwoman of the nation's consumer watchdog said last night.

Full story: http://www.theage.com.au/text/articles/2003/12/02/1070351581003.html

Guarded welcome for Latham

Big business extended a cautious welcome to Mark Latham - but held out little hope the new Labor leader would make significant concessions on the party's corporate governance crackdown.

Full story: http://www.theaustralian.news.com.au/common/story_page/0,5744,8048109%255E643,00.html

ASIC urged to investigate NRMA vote

A former NRMA board member and the NRMA's current president are both calling for inquiries after yesterday's declaration of the ballot on the motoring organisation's constitution.

Full story: http://abc.net.au/news/australia/nsw/metnsw-3dec2003-4.htm

Make top bosses prove their worth

CHIEF executives should be banned from being paid lucrative salaries and bonuses unless they can meet performance goals set by shareholders, unions and customers, the Finance Sector Union argues.

Full story: http://www.careerone.com.au/newsviews/story/0,8523,8029364-22562,00.html

New bill requires greater disclosure from NSW clubs

Tough new requirements about greater disclosure in New South Wales clubs will become law after passing through the New South Wales upper house last night.

Full story: http://www.abc.net.au/news/newsitems/s1002322.htm

Fisher 'hand in till' like child

Greg Fisher, the former head of Australia's first "pink" public company, behaved like a child who "borrowed from the till" and believed he could return the money before it was missed.

Full story: http://www.theaustralian.news.com.au/common/story_page/0,5744,8047190%255E643,00.html

One.Tel trio face a court trifecta

Former One.Tel trio Jodee Rich, Mark Silbermann and John Greaves will be fighting on three legal fronts more or less simultaneously next year after a Supreme Court judge yesterday dismissed their application to defer hearings of two of the proceedings until the first one is heard.

Full story: http://www.theage.com.au/articles/2003/12/03/1070351652047.html

Employers group facing criticism

A peak employers group has come under fire for trying to force down the wages and conditions of some of lowest paid workers in New South Wales.

Full story: http://au.news.yahoo.com/031203/21/ms9u.html

Call to beef up audit watchdog

The chief of the council that oversees the setting of accounting standards is urging the Federal Government to give it more resources.

Full story: http://www.theage.com.au/text/articles/2003/11/30/1070127270064.html

Sports sponsor offside: ACCC

Sportswear brand Fila, which once sponsored five AFL clubs, could face a fine of up to $10 million for breaching the Trade Practices Act after withdrawing its defence in its Federal Court battle with the consumer watchdog.

Full story: http://www.theaustralian.news.com.au/common/story_page/0,5744,8034892%255E643,00.html

Mumbai calling: Jobs shift

MOBILE phone company Hutchison is shifting more of its call centre jobs to India as part of global strategy, laying off 15 more staff last week and leaving only a skeleton customer unit in Australia.

Full story: http://www.theaustralian.news.com.au/common/story_page/0,5744,8055346%255E643,00.html

NEWS HIGHLIGHT

Big end of town a bit unsteady on Latham's ladder

By Elizabeth Knight, the Sydney Morning Herald

The big end of town simply doesn't know what to make of Mark Latham. But its constituents have an uneasy feeling. They know that - to the extent he has bought into issues that concern them - he hasn't come down in their favour.

And because it was only recently that he was elevated to shadow treasurer, they have had little close exposure to this terrier of a politician.

He is an unknown quantity to big business and they are, rightly, very wary of what he might do.

One thing is certain: you could make money selling tickets to any stoush between Latham and the highly outspoken and conservative head of the Business Council of Australia, Hugh Morgan.

In Opposition, Latham can only make a lot of noise - but if he manages to capture the public imagination, he could be a lot more significant this time next year.

So it's worth taking a closer look at what his business hot spots might be. While not being viewed as a friend to big business in a general sense, in the past couple of weeks he has made some sweeping statements that seemed pro-business - some of which appear to have upset those on the left.

A couple of weeks ago he was reportedly pushing to realign Labor's economic objectives in favour of business and the open market.

Latham seems to be talking about more competition and a more inclusive approach to business where unions, shareholders and interest groups can become more involved in decision making. But when you look at specifics, he is clearly not about to do big business any favours.

In October, Latham was quoted saying "our goal is to shift the balance of power from big business towards small to medium-sized enterprises" - comments made as he was describing the salary of Commonwealth Bank chief executive David Murray as "obscene".

It's fair to say John Howard probably shares Latham's view on this but can't find as much political traction in expressing them publicly.

For Latham, making lots of noise about the CLERP reforms concerning transparency and corporate accountability are a no-brainer.

He will never need to satisfy the big end of town and any suggestion that he is pandering to its interests would work against him. Unlike Howard, he would not need to temper his disdain for the excesses and failure of big business in the past couple of years.

Howard at least makes some pretence of giving the big end of town a say in policy - even if it's only a parliamentary inquiry now and again or a couple of round-table dinners at the Lodge.

In a recent newspaper column, Latham made clear his leaning towards the interests of small to medium-sized business.

He said Australia needed a new competition agenda and trade practices reform, and described the evidence of concentration in some market sectors as "damning". "In the grocery sector, Australia has a near duopoly, with Coles Myer and Woolworths enjoying 76 per cent of the market."

Latham strongly advocates giving more power to the Australian Competition and Consumer Commission and strengthening the Trade Practices Act.

He says Labor's first task is to fix section 46 of the Trade Practices Act, which deals with abuse of market power.

It's a big target for Labor and would probably have been on the cards no matter which leader the party had chosen.

The bottom line is that tightening and refining areas of corporate governance, disclosure and even executive salaries, possibly via legislation, would not make Latham any friends in Bond or Collins streets.

But with UK and US precedents before him, it would be a plausible outcome for a Latham-led Labor government.

It would certainly win him lots of friends among small shareholders, who account for many more votes on election day than those on company boards and in management, whose voting power only kicks in at annual meetings.

Organisations representing big business, like the BCA, have fought long and hard against any toughening of the Trade Practices Act.

But the High Court victory earlier this year in favour of Boral on the charge of predatory pricing has provided pro-competition warriors with fresh incentives in their efforts to overhaul the system.

The big end of town is hoping, at best, that Latham's narrow win will encourage him to take a softly softly approach to policy. And as history has demonstrated, many of the more extreme views made in opposition are toned down in office.

It would have been easier for big business if Crean had stayed - he would almost certainly have lost the next election.

A win for Beazley would have been a reasonable second prize. He might have been a better bet for Labor to win but at least big business knew what they were getting.

Latham is an unknown commodity around boardroom tables. It's safe to say he won't be for much longer.

SATIRE

Care of our friends at The Chaser

www.chaser.com.au

James Murdoch new favourite to ruin Rupert's empire

LONDON, Tuesday: James Murdoch has become the new favourite to take over the reigns of his father's empire and run it into the ground. James' elevation to the head of British satellite broadcaster BSkyB comes as a setback to brother Lachlan who had been considered the favourite to squander his father's billion dollar fortune.

Shareholders of BSkyB reacted with anger upon James' appointment.

"We understand that every Murdoch had to be given the chance to prove that he can ruin a company," said one shareholder, "but why does it have to be ours".

Until James' appointment his brother Lachlan Murdoch was seen as a hot favourite to take over after he showed gross incompetence in investing in OneTel. But the opportunity to ruin a major company in the crucial UK market could give James the advantage over his elder brother.

James has defended his appointment, maintaining that he got the job on his merits by submitting a curriculum vitae.

"'Son of Rupert Murdoch' was no bigger on my CV than 'college drop-out'. I don't want to be accused of nepotism," said James. "And if anyone does accuse me of nepotism they can take it up with my father," he added.

Meanwhile Rupert Murdoch has refused to anoint a successor and has largely ignored the jostling for position amongst his children.

"As far as I'm concerned all my children have got a chance to take over, even Grace and Chloe," said Rupert, referring to his two new children had with his third wife Wendi Deng. "They may only be 4 months and 2 years old but they've still shown the same amount of promise as the others."

While the majority of market analysts now prefer James over Lachlan many still prefer an extended vitriolic legal battle between all Rupert's children as the most effective way to ruin the Murdoch empire.

For further information

Contact:   Chris Owen
Email:   c.owen@labor.org.au
WWW:   www.bosswatch.labor.net.au