ACCC allegations against Qantas won’t fast track Alan Joyce’s exit, says chairman Richard Goyder
Explosive allegations made against Qantas by the Australian Competition and Consumer Commission are unlikely to result in an early exit by its chief Alan Joyce.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
Explosive allegations that Qantas sold tickets on already cancelled flights last year will not result in an early exit for CEO Alan Joyce, chairman Richard Goyder has indicated, with the airline to open an investigation into the debacle.
After a horrendous week for the airline’s executives, who came under pressure over a range of issues, Mr Goyder hinted that the board was not about to take any rash decisions.
He said there was much positivity around the airline’s future and the chief executive succession plan was progressing well, ahead of the handover to Vanessa Hudson in November.
On the Australian Competition and Consumer Commission allegations against Qantas filed in the Federal Court on Thursday, Mr Goyder said the board was “undertaking due diligence and seeking external advice”.
The former Wesfarmers managing director was not prone to kneejerk reactions, keeping a cool head during a tumultuous takeover bid for Coles in 2007. As the Wesfarmers share price plunged, Mr Goyder responded that it would all “settle itself out”.
It was expected in coming weeks he would touch base with major investors in Qantas, to talk through issues ahead of the AGM.
Former Qantas investor Steve Johnson, of Forager Funds, said that was standard practice for company chairs, but he warned that Mr Goyder might not like what he heard.
Mr Johnson said it was no longer just customers losing faith in the airline group.
“I think you’ve seen in the share price over the last couple of weeks growing concern over what’s come out (about Qantas) and what you could only describe as a tone-deaf response to it by management,” Mr Johnson said.
“They should be talking to and trying to get a gauge for how shareholders feel about it, and I think a lot of people look at what’s going on and say ‘this is focusing on short-term profitability to the detriment of the long-term value of the company’.
“I don’t think there would be a lot of shareholders who feel differently about that.”
Mr Johnson said Mr Goyder should expect a “very strong message back to the board and management that they have a very valuable franchise that they need to protect at all costs”.
“I think shareholders are undoubtedly happy about how the business has recovered out of Covid,” he said.
“But there is an expectation that those profits are not sustainable and I think shareholders would prefer to see some sacrifice of short-term profitability – it would still be very, very profitable – in the aim of protecting the brand.”
In a case of unfortunate timing, Qantas was compelled to report to the ASX on Friday various bonuses awarded to executives, including shares worth more than $10m for Mr Joyce.
The shares were part of a retention and recovery plan that resulted in non-executive staff receiving $5000 each.
Long-term incentive payments deferred by Mr Joyce over the past three years were also delivered, but he received 1 million shares fewer than expected.
That was due to the fact 50 per cent of performance targets were not met in that period.
Employee groups joined the chorus of concern about the week from hell for Qantas, which began with a fiery Senate committee hearing at which executives were forced to admit the amount of travel credits left over from Covid were much more than reported.
Mr Joyce, Jetstar CEO Steph Tully and corporate affairs chief Andrew McGinnes also faced interrogation over Qantas’s opposition to Qatar Airways flights and accusations of slot hoarding at Sydney airport.
The savaging continued before another parliamentary committee on Tuesday before the ACCC landed a heavy punch with its court action for alleged false, misleading or deceptive conduct.
Flight Attendants Association of Australia federal secretary Teri O’Toole said it was unfortunate that frontline workers would face the brunt of public anger over the allegations.
In a message to members, Ms O’Toole said passengers had a right to be annoyed “but not at you”. She said: “Cabin crew did not make any of these decisions. They were made by the board and the CEO.”
Australian Services Union assistant national secretary Emeline Gaske said the alleged actions by Qantas were “yet another example of the contempt the airline holds for its customers and staff”.
“They are the ones who have been left to deal with the fallout of disrupted travel plans,” Ms Gaske said. “Incoming leadership at Qantas has a serious job ahead of them, when it comes to repairing the significant and entirely avoidable damage done to the airline’s brand and relationships with workers and customers.”
Transport Workers Union secretary Michael Kaine said it was clear Qantas and aviation needed a “total reset”, starting with an ideological do-over at Qantas and a Safe and Secure Skies Commission to be set up.
“It’s taken 15 years of wage suppression, attacks on workers, grounding of the fleet and illegal outsourcing, but Alan Joyce finally faced a moment of reckoning before the Senate committee on Monday,” Mr Kaine said.
“Alan Joyce’s apologies to Qantas customers have become an annual event, coinciding with financial results and a deservedly angry media storm. Apologies only mean something if there is a change in behaviour.”
Qantas indicated on Thursday that it would respond in full in court to the allegations made by the ACCC.
It remained unclear if the selling of tickets on already cancelled flights was a deliberate act to drive revenue, or some sort of large scale system failure.
The ACCC’s investigations identified more than 10,000 flights that were cancelled more than two weeks before passengers were informed. The matter was expected to be heard in the Federal Court before Mr Joyce departed the airline in November.
More Coverage
Originally published as ACCC allegations against Qantas won’t fast track Alan Joyce’s exit, says chairman Richard Goyder
Coal, not cattle pumps out the most methane, says think tank
A think tank led by former ACCC boss Rod Sims says Australia’s fossil fuel producers are emitting twice as much methane as previously thought.
‘Tower of power’ mining-free zone
Mining helps fuel the Queensland economy, but it seems Labor fears any association with the industry going by its strange advertising policy at 1 William Street, aka the Tower of Power.
Property market a buyer’s dream as spring fever hits
Homeowners are flooding the housing market with new listings at the fastest rate for the peak spring selling season in almost a decade.
Aussies no longer fear rate rises, sentiment index shows
Consumer sentiment has lifted to the highest level since 2022 showing Australians no longer fear the prospect of the RBA delivering an unwanted interest rate increase.
Chalmers to boost watchdog’s merger powers
An overhaul of the ACCC’s merger powers, including the ability to block deals without having to go to court, will move a step closer on Wednesday.
Don’t listen to scaremongers, Atlas Carbon tells Aussie farmers
Investing in carbon sequestration projects is an expensive business for farmers and some are being scared off by misinformation, an industry expert says.