By Colin Kruger
Credit: John Shakespeare
Kiwi construction giant Fletcher Building lost a fortune amid the biggest construction boom in the country’s history.
If there was one lesson that Sir Ralph Norris’s board was meant to learn from the disaster was that it needed more people with experience in its core business - building materials and construction.
On Friday, Sir Ralph announced the date he will step down - as an act of atonement for presiding over the worst of the disaster - and also announced four new board members who will significantly shape the company for the decade following his departure.
So who did a penitent Sir Ralph pick to help lift the company from a quick succession of downgrades related to its troubled building division?
We have Barbara Chapman, who ran ASB - the Commonwealth Bank’s local operations - just as Sir Ralph once did. She also had senior roles at Commbank which Sir Ralph once ran.
He also appointed Air New Zealand veteran Robert McDonald who was at the airline so long he must have served under Sir Ralph when he was CEO there as well.
The good news is that he didn’t have an evil plan to stack the board with an entire array of Sir Ralph mini-mes.
He also appointed the well-credentialled New Zealand lawyer Cathy Quinn and former Lion Nathan executive Doug McKay who currently sits on the NAB board. How adventurous.
A great crew, the Kiwis agree, but absolutely zero construction experience between them. What gives?
“While our original intention was to seek a director with construction experience, the appointment of Ross Taylor, who has considerable expertise in this area, our decision to exit the vertical construction sector, and a new strategy in place, we believe the appointments we have made will best support the company’s new strategic direction.”
The Taylor referred to is Fletcher’s new CEO, so it would make sense that he does have construction experience.
CBD recalls that his predecessor as CEO, Mark Adamson, did too.
The problem was that the board was so clueless about construction that Adamson was able to lead them all on a merry dance until the facade on its building division (B+I) collapsed and revealed a disaster of truly epic proportions.
Sir Ralph has opted for the same set-up as last time and hopes for better behaviour at the executive level.
At least he has a better pick on this front. Taylor has managed a few months now without engaging in the gaff-prone behaviour of his predecessor Adamson who famously described one of Fletcher's troubled businesses as "full of pompous old farts" and said Australia needs a “dose of Margaret Thatcher".
Norris has also promised that an Aussie director will be appointed in the coming months.
CBD is really going out on a limb here and is predicting that Sir Ralph’s former Kiwi protege at Commbank Ian ‘Aussie’ Narev has been lined up for his first boardroom gig.
And what could go wrong? He did such a stellar job at the Commonwealth Bank.
Darling Murray
The 2018 Corporate Public Affairs Oration in Melbourne this Thursday should be a cracker.
Giving the oration at James Packer’s pokie kingdom on the Yarra is none other than newly minted AMP chairman David Murray.
Newly minted AMP chairman David Murray.Credit: Jim Rice
We can’t wait to hear what the former Commonwealth Bank boss has to say on his chosen topic: “What’s gone off the rails in corporate governance in Australia? And how do we fix it?”
Former ASIC boss Greg Medcraft is probably still feeling a bit tender after a thorough thrashing from Murray at last week’s American Chamber of Commerce in Australia lunch in Sydney.
Former ASIC chairman Greg Medcraft.
“This was an organisation not focused on its main job, which is to be the cop on the beat in the financial sector.”
Ouch.
Dog stock
Google is such a cruel place for quality journalism.
CBD was saddened to see that the antics of the alleged poo jogger - former Aveo executive Andrew Macintosh - has swamped any mention of the excellent Fairfax Media investigation into some of the unsavoury practices of the retirement village operator where he worked.
Serial defecater and former Aveo executive Andrew Macintosh.
Crapping on your vulnerable customers just isn’t as big a deal as pooping on your neighbours' footpath it seems.
Either way, there is no escaping the whiff of underperformance dogging the stock. A profit upgrade on Friday yielded a stock decline of more than 3 per cent.
It is hard to escape the feeling that it will be a long time before Aveo is out of the investment dog house.
Follow CBD on Twitter. Got a tip? ckruger@fairfaxmedia.com.au