Dash for diversity costs DJs, Myer: Harvey

Gerry Harvey ­blasts gender-diversity guidelines, declaring he’d “go backwards” if he followed suit.

Harvey Norman founder and chairman Gerry Harvey. Picture: James Croucher

Retail billionaire Gerry Harvey, founder and chairman of the Harvey Norman chain, has ­blasted some of the custodians of the nation’s $2.8 trillion super­annuation industry for their ­obsession with gender-diversity guidelines and “tick-a-box” mentality to corporate governance.

Mr Harvey said he was frustrated by super fund executives and their boards, so-called corporate governance experts and fellow travellers in the social corporate responsibility industry who were pressuring him to change his business practices, saying if he followed their ­guidelines Harvey Norman would “go backwards”. Rival ­retailers such as Myer and David Jones had slavishly adhered to the corporate governance orders laid down by these groups, he said, but their businesses were now paying the price, with his own Harvey Norman “beating the shit out of them’’.

He said the nation’s two big department stores had diversity in the boardroom, with female ­directors and independent ­directors, but in most cases they weren’t even retailers.

“Myer and David Jones get all of that box ticking right according to corporate governance rules,’’ Mr Harvey said, “and super funds buy shares in them as they tick all the boxes.”

When asked about the pressure coming from super funds and corporate governance ­activists, Mr Harvey told The Weekend Australian: “I’ve never spoken to anyone yet that runs a public company, that started the public company, that doesn’t agree with me. Now I haven’t got any ­problem with these people having a view, but I’ve got the right to have a view too, and my argument is they are wrong and they don’t know they are wrong.

“They want me to toe the line … and that can be a big problem because they are not practical people. Our results speak for themselves over a period of 50 years.’’

Those results were on display yesterday when Harvey Norman posted a 7.2 per cent increase in full-year net profit to $402.32 million at a time when most retailers are struggling to grow profits.

David Jones on Thursday revealed its operating profit had almost halved to $37m.

Harvey Norman’s profit was helped by offshore expansion cushioning a subdued trading environment in Australia.

The decision Mr Harvey made more than a decade ago to expand offshore has reaped a valuable harvest as overseas revenue passed the $2 billion mark for the first time.

Harvey Norman is currently valued at more than $5.1bn, which is almost four times the combined value of Myer and David Jones.

Last year businessman and company director Chris Corrigan unleashed his own withering attack on the corporate governance industry and its push for gender targets for women on public company boards, accusing advocates who foisted gender equality on companies of bullying.

The former ports boss of Patrick Corporation, whose bitter waterfront dispute with the Maritime Union of Australia in 1998 lit a fire under the industrial relations scene, has in the past detailed correspondence from the Australian Council of Superannuation Investors, the $155bn AustralianSuper and industry fund HESTA relating to meeting requests to discuss “improving gender diversity” and threats to vote against directors of companies with no female directors.

“Chris would agree with me in a second,’’ Mr Harvey said, “because he has run a public company and knows what he is talking about.

“All I’m trying to say is people out there with good intentions on corporate governance, and you’ve got to have what percentage of women on boards and so many independent directors and it’s best to have an independent chairman — and they have all these views, but the problem is 98.5 per cent of them have never run a public company.

“It is very difficult to tell someone who is so sure they are right that they wrong.

“And look, I’ve been running a public company for 100 years. They’ve never done it, and you are telling me how to run it.

“And I’m supposed to listen to you? And I hear what you say, and I think you don’t know what you’re talking about.”