Back on the road: Transurban boss seeks greener pastures

The record financial results from Australia’s $43 billion toll road giant Transurban is the best evidence yet that Australians are back on the road, with traffic numbers finally pushing ahead of their pre-COVID levels.

Having now reached that milestone, it is Transurban’s chief executive of 11 years, Scott Charlton, who has decided to use the exit ramp. What is curious about Charlton is that at 58, and recently remarried, he is keen to take one last puff of the management cigar and take on a new executive role.

Transurban boss Scott Charlton is looking for a new job.Credit: Eamon Gallagher

Normally, chief executives of his age and track record opt for non-executive director roles for ten years to transition themselves into full retirement. And the average tenure for Australian chief executives is around half of what Charlton has already served.

But Charlton says he’s in the market for another job - a fact that might send a shudder through the ranks of under performing chief executives that occupy the corporate ruling class.

His run at Transurban hasn’t been without turbulence - the plagued $10 billion Westgate Tunnel in Melbourne experienced those infamous cost and timetable overruns accompanied by plenty of acrimony, definitely a low point of Charlton’s tenure.

However, the robust shareholder returns and the first half 2023 result Charlton announced on Tuesday are the high notes that he will showcase as he chases another chief executive role.

When he took the Transurban job in 2012, the company was capitalised at $7 billion. Today it is 6 times larger and the portfolio of six major assets the company had when he arrived has now ballooned to 22.

There was talk back in 2019 that Charlton was ready to exit Transurban, but COVID intervened, and he decided to see out the pandemic disruptions.

The challenge for Charlton will be finding a position in Australia with a company as large as Transurban that requires his particular skill set. Many of the other large infrastructure companies are private, so Charlton may need to settle for a professional position away from the share market’s glare.

That said, at the heart of managing many of these companies is the ability to deliver large-scale projects. That not only opens the door to the construction and the mining industry but also to the massive green energy projects where vast amounts of capital will be invested over the next 20 years.

Charlton confides that he is seeking a company that offers the potential for him to ply his skills both in managing and financing mega projects, and balancing the complex needs of a number of stakeholders including governments, shareholders and customers.

Before Transurban, Charlton did long stints in construction and investment banking. Over the years he has established strong relationships with three state governments - having had a pivotal role in their privatisation of toll roads.

And he has dealt very closely with the large superannuation funds that are major infrastructure investors, building a reputation as an astute deal doer.

Fares on some Sydney toll roads, including WestConnex, have jumped.Credit: Edwina Pickles

Few Australian executives would be better connected in these circles. Organisations like Sydney Airport or the NBN spring to mind as the kind that could appeal to Charlton.

While Charlton, a Texan native, says he loves Australia, he is also not ruling out heading overseas to take a new post.

His departure is an increasingly rare example of chief executive transition done properly. Charlton has clearly aired his intentions to leave Transurban at the end of this calendar year and the board has appropriately passed the information to the market.

That leaves Transurban with nine months to find a replacement – and while the company is conducting a comprehensive international search it may well land on one of the internal contenders.

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