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NewsFebruary 2004
The government is refusing to disclose the economic analysis showing how the Free Trade Agreement with the US will deliver net benefits to the Australian economy, leading many critics to argue that the agreement was signed blindly. Already the government, by buckling to US demands (particularly on agriculture trade), have greatly reduced the predicted $US2 billion a year windfall from the FTA, risking thousands of jobs, hundreds of businesses and our cultural identity in the process. Full Story] Taking the Piss-Part 2 After resigning last Friday, Frank Cicutto walked away from his less than average performance as head of the National Bank with a total payout of $14 million, including a cash bonus of $1.3 million, options worth $4.5 million and amazingly, a broken contract fee of $3.3 million for the contract he obviously broke. Meanwhile, global monster ExxonMobil, that in a recent report was shown to be responsible for 5 per cent of global-warming emissions and countless injustices in the third world, has reported the highest profit in corporate history- US$17 billion. Full Story] January 2004
Are we really meant to believe that a freeze on the payment of bonus shares and options to NAB boss Frank Cicutto and two other senior executives will stop them profiting in some way from the $1 billion sale of shares designed to cover the $360 million losses incurred by their incompetence? And what do we make of Air NZ’s plans for major expansion? This is a company that used a chunk of a $NZ885 million bailout package to pay bonuses to the executives that oversaw the collapse of Ansett in 2001, leaving hundreds of Australian workers fighting for their dues to this day. Full Story] Risky Business The management record of NAB boss Frank Cicutto is under fire since trading losses that could cost the bank up to $600 million were revealed last week. In the past year, Cicutto has overseen forced payouts to misled unit trust customers totalling $132 million and he also headed the failed share market raid on AMP, which secured it only 2.2 per cent of the target and bumped up the share price. On the flip side however, taking serious risks has earned a stock market trader in London $70 million, one of the biggest bonuses ever seen, the equivalent to the average annual earnings of more than 1100 people. Full Story] Making Up the Numbers The whistleblower who exposed three months of unauthorised trading that lost NAB up to $180 million may have a nervous wait before the CLERP 9 amendments to the Corporation Act offer full ‘whistleblower’ protection. The draft Bill, due for debate early this year, proposes that those who report suspected breaches of the Corporations Act be protected against criminal and civil liability, defamation, termination of contract, and victimisation. On another front, the draft Bill also proposes tighter controls in areas where fraud is most likely to occur, namely the areas in companies' books that require estimating and/or managerial discretion. Full Story] December 2003
ASIC’s annual investigation of financial reports has uncovered the true state of corporate Australia in finding 161 companies to be at risk of becoming insolvent, another 52 in breach of accounting standards and a further 74 companies failing to give a value to options packages when disclosing a director's remuneration package. Meanwhile, the ‘soft on reform’ Howard government maintains that the sordid inner workings that led to the $5.3 billion HIH collapse were not an indication of a need for sweeping, hard-line corporate law reforms in Australia. Full Story] 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. Full Story] November 2003
Ross Cameron has delighted his mates at the big end of town by signalling the Liberal government’s soft turnaround on corporate governance law reform. Cameron, parliamentary secretary to the Treasurer, claimed there was no need to implement hard-line laws to protect the community against corporate corruption and suggested that the $5.3 billion HIH debacle was not an indication of a need for change. Meanwhile, advocates for stronger CLERP 9 reforms have voiced concern over revelations that executives of the top four banks will be taking home over $25 million in uncontested salaries and options this financial year. Full Story] The Real Corporate Terrorists Nominee companies splatter the ‘top 20 shareholder’ lists of most Australian companies but with all their influence they are not subject to the ASX Listing Rule 4.10.9, which means they do not have to reveal to the public or normally even the company being invested in, the identity or any information relating to the companies or individuals that actually hold its shares. An OECD report on Corporate Governance, detailed by Oxfam, suggested that nominee companies allowed shareholders to shirk social responsibilities through anonymity and further, nominee companies may be used for illicit purposes including money laundering, bribery, corruption, improper insider dealings, illicit tax practices, and financing terrorist activity. Full Story] Loopholes Fairfax CEO Fred Hilmer can just put his feet up and not worry about meeting performance criteria to receive his huge bonus next year. Hilmer paid a premium to gain a put option with Macquarie bank which protects his so-called ‘performance incentive’ from a fall in share prices. Meanwhile, unless changes are made to close a loophole in family law, people like Jodee Rich could declare themselves bankrupt but continue to live it up in style. Rich’s lifestyle is protected after he signed financial agreements to change $5 million worth of property ownership into his wife’s name two days AFTER the One.Tel collapse. Full Story] Baiting the Toothless Tigers Kerry Packer has agreed to set up a corporate governance committee at PBL but in the same breath he joined other bigwigs in denouncing the ASX governance guidelines and the importance of independence on company boards. Also this week, ASIC’s powers to prosecute dodgy dealers at the big end of town were severely undermined and those dinosaurs at the Business Council of Australia were at it again, arguing that legislation prescribing the level, design or structure of CEO pay serves no constructive purpose. Full Story] October 2003
A recent study by Ernst & Young found that a lot of directors still don’t get the fact that strong governance is a prerequisite for their job. The majority of those directors surveyed argued they ought to get a pay rise to compensate for increased governance requirements. Do they realise at all that these requirements work to protect their own backsides, the value of their own shares, the hip pocket of the investors who pay them and the livelihoods of the workers that make it all happen? Or, are they just scared of a bit of extra work? Full Story] Driving the Porcelain Bus It is hard not to be sick when reporting the arbitrary executive pay increases and undemocratic constitutional changes being made at the big end of town this week. Boral passed a resolution to increase the number of shareholders required to put special resolutions to AGMs from 100 shareholders with any number of shares, to only those groups whose combined shares total more than 5 per cent of the company (roughly 28 million shares). Once the resolution to quash the voice of the small investor was passed, the Boral board promptly raised their own salaries by 55 percent. If that wasn’t enough to get your stomach turning, consider AMP, facing a $4 BILLION-PLUS NET LOSS this financial year, disclosed it had set aside an extra $38 million in sweeteners to retain 160 of its top executives…sickening. Full Story] Power to the People! The message is finally getting through...Rupert Murdoch was “shocked” by the extent of the protest by Australian investors towards his plan to issue free options (with no performance hurdles attached!) to six of his company's executive directors. Even though he could have passed the proposal with his one vote, he was reminded he makes his money in a democracy and backed down, heeding the warnings of a backlash by angry investors. As community awareness of the boardroom dealings at the big end of town increases, announcing arbitrary executive pay rises such as this is fraught with danger. Lets keep up the pressure! Full Story] Feudal Versus Fairness Debate over the draft legislation (CLERP 9) aimed at improving shareholder protection hotted up this week. The Business Council of Australia and other anti-CLERP lobbyists, in their cynical attempt to protect the huge salaries of their big end of town members, have been dubbed ‘irrelevant dinosaurs’. Gladly, the real debate now lies with the legislators…Labor pushing for the more comprehensive changes that are needed, and the Libs, who by not going far enough with the proposed changes, are happy just to ease their rich executive mates out of the Dark Ages. Full Story] Back in the Dark Ages The heavy handed tactics proposed by the BCA last week to counter Federal Government moves to give shareholders a vote on the pay of company executives has gladly been dismissed as being of a 'medieval mindset'. However, the Australian Foundation Investment Company (AFIC) AGM this week highlighted how much more needs to be done to make the voting system open and democratic...even though a vocal majority voted against a 250 percent pay rise for the CEO, the motion was passed via proxies. The government's proposals are a start but not nearly enough to drag big business practices out of the dark ages. Full Story] September 2003
As predicted, most companies report that they won’t even bother with the toothless ASX corporate governance guidelines this year. However, some good news for the little person as new and enforceable corporate accountability reforms (CLERP 9) have been tabled and will encourage shareholder activism by allowing small investors the opportunity to make regular comments on company performance, including a say in the remuneration of executives. Unhappy with these fair and modern reforms however, the Business Council of Australia have responded by proposing a range of heavy-handed tactics to curb ‘disruptive’ (code for inquisitive) behaviour by shareholders at AGM’s, including forcible removal by security guards. Full Story] Pays High, Profits Low Executives continue to expect full remuneration and bonuses despite poor performances. As one punter plainly put it "ANYONE could go in and lose a company millions of dollars...it takes a senior executive to expect to get paid for it." The Reserve Bank’s profits fell but Ian Macfarlane still got a substantial pay rise. Village Roadshow, after a terrible year of write-downs and dwindling profits, still made large payments to the executive team. Shareholders must be given the power to enforce executive pay levels, particularly in cases of poor performance as too few board directors and executives will take it upon themselves to do so. Full Story] Write Off! Following in the footsteps of Newscorps $12 billion write down in 2002, the top 100 Australian companies have already written off $6 billion from their capital bases this financial year, making the return on capital a lot more palatable for their shareholders. While Adsteam’s arbitrary write downs will cover their plans for extensive redundancies, Mayne’s CEO simply spent a few minutes with a red marker to make the numbers look good, before putting his hand out for a pay rise. Full Story] Stay Tuned… We are nearly at the end of the profit reporting season and Bosswatch is eagerly awaiting the chance to analyse annual reports to expose who got the big executive salaries and the unjustifiably excessive stock options for a less than average performance this financial year…there are sure to be a number. In the meantime, shake your head at a selection of the more dubious activities at the big end of town that didn’t quite make the headlines this week. Full Story] August 2003
Directors continue to spread themselves thin by sitting on multiple boards to keep their earnings on par with senior management. Until directors dedicate enough time to fully understand the companies in their portfolio, they cannot hope to be fully confident in the integrity of business activities in which they are involved. This week, overloaded Southcorp directors learnt the hard way for showing little respect to the shareholders and workers that offer companies the most but watch from the sideline with the most to lose. Full Story] Howard’s Hangover Continued… Howard’s ethanol hangover continued this week as it was revealed his session with Honan has cost hundreds of jobs that would have been created by a CSR backed ethanol plant planned for Queensland. While Howard and his mates at the big end of town bandy together in their ‘pseudo society’, we in the real world can take heart from the growing strength of co-ops (highlighted last week) and the revelations this week that socially driven industry super funds, without a need for profit and with those managing them earning smaller salaries, are putting the capitalists to shame. Full Story] Down The Gurgler Howard’s ethanol hangover doesn’t look like easing this week but his mates at the big end of town will be raising their glasses in celebration over the shock retirement of ASIC chief, David Knott. Chances are, Knott’s replacement will follow the corporate-friendly trend of the new ACCC and APRA bosses…we continue to watch the strength of Australian corporate regulatory bodies go down the gurgler. Also this week, AMP’s woes continue, the ACCC praises the unenforceable governance guidelines set out by a corporate heavyweight, Billabong puts money over motto and we ask if Gerry Harvey is serious? Full Story] Mooers Egg While a study has shown that the average Australian worker doesn’t think twice about doing unpaid overtime, the big end of town is finding absurdly indulgent ways to spend the money saved from such selfless worker efficiency. This week we highlight the volley of threats that came from the toothless corporate watchdog and wonder how Macquarie execs can say they have a ‘clear conscience’ over the Nardell Mine closure. Full Story] July 2003
The unsavoury practices of profit hungry Australian banks headlined the business news this week. Amongst the worst, the CBA announced a further 600 front-line jobs to be axed despite a strong half-year performance and the Bell litigation case uncovered just how little the big banks care about their social responsibility. There was however some good news for Australian businesses that don’t mind a little blood on their hands, the first Australian company to be offered an opportunity to profit off US leftovers in post-war Iraq was announced this week and lo and behold…it’s a bank! Full Story] Tell Us Something We Didn’t Know The Bell Group litigation is shaping up to be Australia’s largest litigation case with many commentators predicting years of court hearings and countless millions of taxpayer dollars to be spent on proving what we already know…banks are bastards. While we wait in hope for this fact to go down in the annals of law, a number of studies released this week report that the big end of town is occupied by boring, conservative, bean-counting execs who care little about their workforce’s insecurities…again, tell us something we didn’t know! Full Story] Macquantradiction Hang on! Didn’t we report last week that Macquarie Airports were to cut forty percent of its workers over the next year due to ‘commercial pressures’? This week those same pressures mattered little as Macquarie Airports rubbed salt in the wounds of nervous employees by confidently backing its ability to raise $54 million for a mere 2.5% increased stake in Sydney Airport. In a weird week of contradictions, we report on executives who earn more than their bosses and a group of fund managers (God bless them) who have come on board the exec pay issue by voting against executive pay rises at AGM’s. Full Story] The Tip of the Iceberg For those who have watched a number of high profile Australian corporate disasters in recent times it wont come as any surprise that a report has shown that we lead the western world in corporate fraud. As suspected, Adler, Rich and a number of other shysters facing the music this week for alleged fraudulent corporate activity, represent only the tip of the iceberg. If the PwC report is anything to go by, there must be more than a few nervous execs at the big end of town. As for those that cashed in this week, they will tell you that it is amazing how anxieties just ‘fade away’ when exercising huge stock options or approving their own pay rise. Full Story] 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. Full Story] June 2003
It seems that Howard and his mates from the big end of town still have trouble discerning fact from fiction. While the Australian people wait for the chance to drag Howard over the coals for his falsely advertised war on Iraq, his mates in the banking sector are off to court for their ‘reckless’ bending of the truth. Little consolation for those who lost jobs this week however, more big payouts and stock options exercised for those, who it can be argued, couldn’t run a choko vine over an outhouse. Full Story] Dimwits and Dictators While a report this week highlighted serious governance issues surrounding the amount of party-related transactions occurring within Australia’s top 50 public companies, some prominent board-seat warmers found themselves being dragged over the coals for just ‘plain incompetence’. Full Story] Rough Justice? High-profile stockbroker Renee Rivkin is locked up for insider trading as Australian consumers are sentenced to a pro-business chief of the ACCC. Full Story] May 2003
Labor Council research blows the whistle on executive pay, showing that the more you pay the less you get. Full Story] Going, Going … Is it Philip Nitschke? No just the sound of corporate Australia putting a few more thousand workers out of their collective misery. Full Story] Crash Landing Gravity of Justice? The high fliers of the corporate world are falling back to earth and the business world’s oracle says its high time. Full Story] The Costs of Excess Some tall business poppies had their heads lopped this week as the laws of economic gravity applied their always chaotic theory. Full Story] April 2003
The HIH royal Commission is in, but little is likely to change with the Howard Government washing its hands of calls for increased regulation of the corporate sector. Full Story] The Sacking Season Whether you were at the board table or the shop floor, the knives were out this week, with CEOs and workers alike discovering they were surplus to requirement. Full Story] Up To Their Necks In It If the War on Iraq is not enough to give one the jitters, a new survey showing nearly half our companies are on the edge of insolvency should push you out of the comfort zone. Full Story] March 2003
Corporate Australia is getting a bum wrap form the punters and the captains of industry have begun to cry poor. Full Story] Boardroom Babble More tales from the lottery economy where a falling share price is no barrier to unimaginable wealth. Full Story] Groundhog Day Another year, another round of corporate excess. Bosswatch returns from its summer slumber to find the same old dogs up to the same tricks. Full Story] December 2002
It was a year where the corporate world finally came close to consuming itself with bloated salaries, off the wall options and a string of mega-collapses Full Story] Management, Australian Style A new study of Australian managers finds our executives are wimps; although no-one has told those at the sinking helm of NewTel. Full Story] The Great Protection Racket Australia’s corporate leaders are skimming millions in cash bonuses, protecting share options so they win no matter what. Full Story] November 2002
The Howard Government backs off its plans to privatize the rest of Telstra under market pressure. But it’s nothing like the pressure that former HIH directors are under. Full Story] House of Cards The fallout from the HIH collapse threatens to travel all the way to the Lodge with a legal case pulling the PM into its complex web. Full Story] The Fifty-First State? As doubts rise about the long-term returns from US bonds, Australians, alone, can’t get enough of Uncle Sam’s stuff. Full Story] Heading For A Fall? There have been warnings of another wave of corporate collapses on the horizon as the Annual General Meeting season rolls on with more than a little resistance from shareholders. Full Story] October 2002
With new research suggests CEO carry similar personality traits to psycho-paths, the AGM season is proving that there’s little room for logic in our nation’s board rooms. Full Story] Rogue’s Gallery As the corporate Annual General Meeting season descends on us, the captains of industry are holding out there hats and crying poor. Full Story] Righting the Wrongs Australian corporate giant BHP-Biliton is at the centre of an historic redistribution of wealth in South Africa that makes Mabo look like small bikkies. Full Story] Crikey! That Was Close Corporate crusader Stephen Mayne makes a tilt at the News Ltd Board and gets closer than anyone expected (well, within 1 billion votes, anyway) Full Story] Snouts in the Trough It’s AGM season in the corporate world, and deal after shady deal is being exposed as highfliers treat company accounts like the proverbial honey-pot. Full Story] September 2002
It was a week when it paid to be sacked, with outgoing CEO’s of big financial institutions walking away with some juicy seven-figure payouts. Full Story] Turning Tides? A major industry super fund signals it will formally oppose executive option packages as a senior US official uses the anniversary of S11 to lecture against corporate greed. Full Story] RIP Chainsaw Al One of the heroes of corporate downsizing has been cut down but his memory lives on with the golden handshakes for leaders of failed businesses still think on the ground. Full Story] Broken Trust The corporate world is holding back the waves of accountability with a crackdown on trusts rubbished and resistance to a new plan to increase corporate disclosure. Full Story] August 2002
Treasurer Peter Costello’s two faces were on display this week – ducking and weaving from enforcing corporate accounting standards while upping the push to cut corporate tax. Full Story] Speak No Evil The majority of Australian firms are staying mum on the amount of options they offer their executives as Howard continues to stonewall corporate law reform. Full Story] Rayland And Other Adventures More evidence emerges in the HIH Royal Commission of the joys of life at the Top End of Town. Full Story] Muddy Waters It was a week when the Prime Minister washed his hands despite mounting evidence that the corporate world is out of control. Full Story] July 2002
It was a week of carnage on the markets – and for a few former corporate high-fliers it was even uglier. Justice? Of just a system in decay? Full Story] Bosswatch News: Nothing Exceeds Like Exc As the world market lurches under the weight of its own amorality, regulators and business lobbies are locking horns over the need for more rules. Full Story] Mind Your Business Company directors argue that complying with ‘strong’ corporate governance procedures leaves too little time for them to understand the finer workings of the particular company that shareholders have paid them good money to oversee. Full Story] Capitalism in Crisis The collapse of a US telco has sent shockwaves around the globe and undermined trust in a system that rewards hype and dishonesty. Full Story] June 2002
The Big Australian discovers a uranium mine it never knew it had, a corporate fraud sparks a worldwide market plunge and the price of investing ethically. Full Story] Who Wants To be a Millionaire? There are more of them than ever before, according to a new global survey of the world's richest. Full Story] Bosswatch News: The Great CEO Swindle Breath-taking figures from the USA show the extent to which executives are taking a bigger and bigger slice of the corporate pie. Full Story] Bosswatch News: In the Cauldron It was another week of pull-outs, profits de-mergers and takeovers in the corporate world; but some bright news with a plan to make executive pay more accountable. Full Story] May 2002
Australia's wealthiest were on display this week as BRW released its annual Rich 200 list. Full Story] The Good, The Bad and The Ugly Jobs are under threat in the textile and trye markets; but there's better news in the Newcastle mills and the Nike factories. Meanwhile, the rich continue to rule the world - but where's the story in that? Full Story] Boss Watch News – The Bottom Line Peter Costello wasn't the only one flaunting a budget deficit this week, as Rupert Murdoch announced the largest corporate write-down on record. Full Story] Smoking the Company Line The first in a regular series behind the big names on the corporate landscape. This week: the tortured logic behind British American Tobacco. Full Story] BossWatch News:Show Me The Money! It may be May Day - but life in the banking industry has never been sweeter - unless you're in the gambling caper. Full Story] April 2002
Rio Tinto faced its shareholders, Ford faces a backlash and a bid to cap US executive salaries fails. Full Story] Boss Watch News - Stand and Deliver It might be tough for some - but for shareholders and executives, life is just dandy. Full Story] NAB and Other Catastrophies It was a week where NAB slashed jobs and executive bonuses went south. Justice? Not on your nellie. Full Story] Bosswatch News - Walls Come Dowm NAB plans to cut thousands of jobs as the ANZ faces legal action for gagging a worker from talking to the press. Who said banks have an image problem? Full Story] March 2002
How to be a millionaire without making any money and other great sleights of hand; a win for Westpac workers and more time off for baby in the retail sector. Full Story] Bosswatch News – March 12 It's half-yearly reporting season, where the corporate successes – and excesses – come under the microscope. Full Story] February 2002
Our debut weekly round-up on who's in bed with who, how much they're paying and who else they're sleeping with. This week, Qantas rakes it in, NAB pays big failure, liquidators back worker entitlement rights and emerging ethical challenges for companies doing business in South Africa. Full Story] Job Losses for Manufacturing The annual survey of 880 Australian companies by the Australian Industry Group (AIG) has found that employers expect to shed 2 per cent of the manufacturing workforce in 2002 despite the same survey finding that most companies predict a growth in business of 2.7 per cent by the beginning of next year. Full Story] January 2002
More than 4,000 employees of the new Ansett will share in any profits made by the company under a groundbreaking deal between unions and the airline's new owners. Full Story] Attack on US Workers Rights While much of the public debate is focused on terrorism, the Bush administration has quietly busied itself attacking the nation's labor standards. Full Story] Corporate Defaults Record in 2001 Over 210 firms defaulted $A223.34 billion globally in 2001 setting a new record according to the credit rating firm Standard and Poor's. Full Story] Qantas's Warfare Agenda Exposed Qantas management is prepared for an industrial showdown and believes "now is the time" to bring on a major dispute with unions, according to an internal briefing not for management. Full Story] December 2001
A senior Indian opposition party politician who regards Australia's Packer family among friends has admitted his party accepts hidden cash for election campaigning. Full Story] Corporate Database will Watch the Boss Workers will be able to map the corporate landscape for the first time, with the release of a new campaigning website with the capacity to track connections between companies online. Full Story] Unprecedented Action by Bank Workers Bank workers employed by ANZ, Westpac and the NAB will take part in unprecedented industrial action this week. Full Story] Corporate Giant behind Government Report A contentious federal government report calling on Australia firms to export their IT jobs to India was sponsored by multinational giant BHP-Billiton sponsored. Full Story] November 2001
The proposed merger of two of Australia's largest printing groups could spell disaster of the NSW town of Dubbo - with its second largest employer facing closure. Full Story] |
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