Ex-WiseTech chair Richard Dammery slams funds for ESG, investment gap

Former WiseTech chairman Richard Dammery has criticised superannuation and investment giants for failing to present a united opinion on major corporate issues.

Former Wisetech chair Richard Dammery: ‘To hear competing perspectives from within one institution … is not helpful.’

Former WiseTech chairman Richard Dammery has criticised superannuation and investment giants for failing to present a united opinion on major corporate issues, with ESG experts and portfolio managers from the same fund delivering different views to boards.

Mr Dammery, along with a host of directors, quit the company in February citing “intractable differences” over the ongoing role of Richard White, its tycoon founder.

An internal review subsequently released found Mr White misled the board over his past relationships.

Before his exit, Mr Dammery was involved in months of talks with investors over WiseTech’s leadership and governance concerns, including high-profile industry funds such as AustralianSuper and HESTA.

Juggling starkly different opinions on corporate issues from within the same investment funds added another layer of challenges to navigating the corporate governance storm, according to Mr Dammery.

“What was less helpful was some of our institutional funds coming in with their portfolio managers and giving their perspective.

“And then, having completed that exercise a week later, sending the ESG teams in to give me a rather different perspective,” Mr Dammery told the Australian Shareholder Association investor conference on Monday.

Investors would then have an expectation “the board would reconcile that, rather than the fund reconciling its position and communicating it with one voice”.

Xero chairman David Thodey.

Mr Dammery, who serves as a director with Australia Post, said it was an issue where big investors could improve.

“It’s something that our institutional shareholders should reflect on because boards are always dealing with – and chairs in particular – dealing with a range of different perspectives, which can’t be readily reconciled. But to hear competing perspectives from within one institution, again, is not helpful.”

The ex-WiseTech chair did not single out any individual superannuation or investment players but said the issue often happens where investment funds have separate teams.

More broadly, pushback against an environmental, social and governance focus gained traction after the election of Donald Trump and amid a broader reality check over the difficulty of delivering net zero solutions in the economy.

Xero chairman David Thodey said there had been a noticeable change among investors on ESG in recent times.

“They’ve all changed their tune in terms of when they come in they used to lead with ESG and then we’d get into the numbers. So that has changed,” Mr Thodey told the same conference.

Mr Dammery added fallout from board upheaval at the tech giant was “regrettable” after allegations Mr White exchanged business advice for sex.

“It’s regrettable what occurred. I don’t think it was what any of us were hoping for,” Mr Dammery said.

“But in the end, when you’re a director, whether you’re the chair or not, you’ve got a clear standard to adhere to, and that’s acting in the best interest of the company, which is by definition, distinctly different from acting in your own individual best interests.

“And so once you form a view that you can’t fulfil the role, then I think it’s in the best interest of the company that you leave.”

Mr White in April crowned himself WiseTech’s new chief innovation officer in addition to his role as executive chairman.

AustralianSuper in March sold its $580m WiseTech stake because it cannot get sufficient comfort around its governance, weeks after Mr White seized back control of the software company he co-founded.

Industry super fund HESTA has been vocal in its criticisms and in February demanded the tech giant restore an independent board after the four independent directors quit in protest.

In March, the logistics software giant announced that former chairman Andrew Harrison – who stepped down after near nine years as chair in April last year – had been appointed to the lead independent role, taking over from Mike Gregg, a 16-year WiseTech board veteran who was hired for the position just five weeks ago.