How the Michelle Guthrie crisis unfolded at ABC

Illustration: Rod Clement

As it swung from leadership workshops to crisis meetings, Justin Milne’s ABC board went to great lengths to address ­Michelle Guthrie’s intractable leadership problem: herself.

Margin Call has spoken to multiple sources familiar with the dramatic decision by Milne’s board to sack Guthrie half way through her five-year term as the boss of the ABC.

The most obvious takeaway: Guthrie was given plenty of warning that her position as Aunty’s managing director was imperilled.

“It has been brewing for a long time,” said a well-placed source.

The trouble was Guthrie’s leadership style. She was characterised to us as “inflexible” and unable to deal with criticism — never more so than during her downfall.

“She was incapable of bringing people along with her,” said another source familiar with the Aunty upheaval.

Too many relationships broke down.

There were complaints from her executive team (indeed, the board was concerned some might depart if Guthrie’s reign continued), ABC staff (many of whom were brutal in their assessment of their departed boss), the federal government (which was complicated by Milne’s long relationship with the now former prime minister Malcolm Turnbull) and, terminally, the ABC board.

Her inability to manage that final one was extraordinary.

In an attempt to prolong the tenure of their managing director, we understand Milne’s board organised a workshop in recent weeks with themselves and ­Guthrie to address their problematic relationship and other festering issues.

That workshop ran for hours. The problems continued.

Following that effort, we understand the Aunty board — which along with the chair includes McGrath chair Peter Lewis, SCA Property Group ­director Kirstin Ferguson, executive coach Donny Walford, Minerals Council of Australia chair Vanessa Guthrie, Royal Flying Doctor Service director Georgie Somerset, investment banker Joe Gersh and ABC staff director Jane Connors — met three times last week in an attempt to end the Guthrie era in a less ugly fashion than what has transpired.

Their managing director had other ideas.

During the first gathering on Wednesday, we understand Milne tried to bring Guthrie around to the decision his board had come to after months of deliberations — time was up in the $900,000-a-year gig for the former Google and News Corp executive.

Incredibly, despite losing the confidence of her board, Guthrie wasn’t for leaving.

We understand Milne’s board then met again on Friday, but were still unable to resolve the situation amicably.

On Sunday night, the board met again by phone hook-up and took the other approach.

They resolved to fire Guthrie and then made the humiliating news public yesterday morning, hours after an embarrassing story on the breakdown of Milne and Guthrie’s relationship appeared in The Australian.

Remarkably, Guthrie still hasn’t accepted the decision, warning she was considering her “legal options”.

Putting on a brave face

Less than a fortnight ago, ABC chairman Justin Milne and his then managing director Michelle Guthrie hosted M ichelle Rowland as Aunty’s guest at the Canberra political class’s biggest social night, the Midwinter Ball. Margin Call understands that was only days after Milne and Guthrie had met for their professional relationship “workshop”.

Justin Milne at the Midwinter ball at Parliament House in Canberra. Picture: Gary Ramage

The two did an excellent job of projecting that all was well. Fellow Midwinter guests including Rowland — the would-be communications minister in a Shorten government (and, consequently, the hope of Ultimo) — didn’t twig to the terminal state of their relationship.

Indeed, we understand Rowland only learned about the rupture when The Australian’s Stephen Brook broke the news online yesterday morning. Milne’s ABC called to discuss the departure shortly afterwards.

Michelle Rowland arrives at the Midwinter ball. Picture: Gary Ramage

Milne, the former CEO of the Turnbull-backed OzEmail, still has 3½ years of his five-year term as ABC chairman left.

Although as Guthrie has learned, these things can be compressed — in the chairman’s case, by the government of the day.

So what would become of Milne in a Shorten government?

The talk in Labor circles is that, should Bill Shorten become our next PM, they will make a fresh assessment based on the state of the national broadcaster. Very reasonable of them.

Who’s in line?

Aunty is not Justin Milne’s only government-sponsored board position.

As well as his prestigious leadership role at Leichhardt Rowing Club, Milne also sits on the Ziggy Switkowski-chaired NBN board, which earlier this year had to deal with its own managing director replacement after former Vodafone boss Bill Morrow quit in April.

While a much less dramatic departure, it might offer some lessons about what comes next.

Switkowski’s board replaced Morrow with a well-credentialled internal candidate, Stephen Rue, who had been NBN’s chief financial officer.

Well-informed Ultimo watchers expect Milne to take a similar approach at Aunty.

Yesterday the longserving ABC executive David Anderson was made acting managing director.

Anderson — who was the lead internal candidate in 2015 when then chair Jim Spigelman instead picked Guthrie as a change agent — is now the clear favourite to get the permanent gig.

Guthrie recruit Louise Higgins — who for the last
year and a half has been Aunty’s chief financial and strategy officer — has some backers, although Higgins’ CV, which spans Nova Entertainment and Macquarie Bank, looks a bit exotic for the moment.

After all the recent upheaval, Anderson’s nearly 18-year-long stint at the ABC has never looked so attractive.