Corbett abruptly exits Woolies

The supermarket giant’s adviser and former CEO has opened up to The Australian after abruptly exiting the group.

Woolworths announced the abrupt end to Roger Corbett’s position as an adviser this afternoon.

Roger Corbett has told The Australian this afternoon he believed Woolworths’ struggling supermarkets business could be turned around to once again be competitive with arch rival Coles, and he also hinted that his belief – and advice to the board – was to keep underperforming general merchandise chain Big W rather than dumping it.

He said Big W’s recent ills were caused by bad management.

“Well Woolworths has an excellent board of directors, it has got an excellent franchise of stores and it’s got an outstanding liquor business, and Big W with a new managing director in Sally Macdonald,’’ Mr Corbett told The Australian.

‘’Big W has been an excellent asset in the past and there is no reason (it can’t succeed) if it’s well managed in the future. (Big W) had a wonderful position in the market and was clearly the market leader with everyday low prices, it was by far the biggest and most profitable out of Target, Kmart and Big W -- and it’s only bad management that it put it where it is today.

“You know, with good management clearly the locations and the sites are there.”

Reflecting on his 7 months advisory work with Woolworths, Mr Corbett said it was a productive time for him and the board, and new chairman Gordon Cairns.

“I had a very effective 7 months and I think that over that time the board was being rebuilt and the chairman is clearly very much in control and running an excellent business, and I enjoyed his support and the board’s full support and it was a really pretty effective time thank you.’’

He said Woolworths could compete with German discounter Aldi, saying it needed to match prices and kill off the impetus for shoppers to visit an Aldi store in the first place, while he also congratulated the hard work done by former Coles boss Ian McLeod who transformed Coles from an underperformer to a retail star.

But Mr Corbett said he didn’t have enough capacity to still advise Woolworths despite recently stepping off the board of US retailer Wal-Mart.

“I’ve got plenty to do, and I have an ongoing involvement with Wal-Mart as well but not nearly as time consuming as my involvement with Woolworths would have been. I’m still a consultant to the Wal-Mart board and I go back to (the US) twice a year.’’

The comments came after Woolworths announced the abrupt end to Roger Corbett’s position as an adviser this afternoon, saying the former chief executive of the supermarket giant had growing commitments elsewhere.

“Roger Corbett AO has indicated he is unable to continue his consultancy arrangement with Woolworths as a result of the major expansion of MaynePharma, of which he is chairman,” Woolworths said in a release.

Woolworths chairman Gordon Cairns appointed Mr Corbett as an adviser to the company’s board in November last year, at the height of Woolworth’s Masters hardware crisis and amid speculation of takeover bids following a sharp share declines.

Mr Corbett, who also recently stepped down from the board of US retailer Wal-Mart, is believed to have been paid more than $700,000 for less than one day a week of advisory work at Woolworths.

The appointment was one of Mr Corbett’s first as chairman of the retailer, with directors and senior executives hoping some of the shine from his years as boss of Woolworths during its golden age would rub off on the retailer.

His position was then described as a “mentor to senior management”, having been chief executive of the supermarket giant from 1999-2006. Woolworths chairman Gordon Cairns todays said Mr Corbett had assisted him in the role “and has provided the benefit of his vast experience and passion for Woolworths.”

At the time of the appointment the then new CEO of Woolworths, Brad Banducci -- handed the toughest role in retail to revive Woolworths sliding sales and profits -- said he was happy to work with Mr Corbett and could learn a lot from the retail king.

“To be clear, Roger and myself have already agreed that we’re going to agree on about 80 per cent of things. There are 20 per cent of things that will be different, by definition, and we have both been very open with each other that that’s the case,’’ Mr Banducci told The Australian last year after Woolworths AGM in November.

“If you can agree with anyone about 80 per cent of things, you’re probably going well,” Mr Banducci said.

Woolworths chairman Mr Cairns said late last year that “walking with Roger in the stores and getting his advice is absolutely invaluable.”

Today, Mr Corbett said that given the “significant changes to my other responsibilities announced today it seems an appropriate time to withdraw.

“I have enjoyed the opportunity to support Woolworths with the initial stages of its transformation, and to assist the team through recent leadership transitions,” he said.

Prior to becoming chief executive, Mr Corbett was appointed executive director of Woolworths and managing director of Big W in 1990, and was managing director of retail from July 1997 before assuming the top role.

Mr Corbett’s arrangement with Woolworths will conclude at the end of July.

At 3.52pm (AEST) Woolworths shares were off 0.24 per cent to $20.63 against a 0.5 per cent benchmark fall. Woolworths’ intraday low was $20.31, its high $20.71.