Richard White needs to step aside to protect WiseTech

At the very least, the WiseTech boss should take up his board’s suggestion to temporarily vacate his position.

WiseTech’s double-digit share price dive marks the moment investors have finally confronted the key man risk which now represents the technology major’s biggest weakness. At some point there will be no turning back.

As founder, CEO and shareholder Richard White too needs to recognise revelations around his personal life have become a major distraction for the $40bn tech company, his staff and customers. The 69-year-old is starting to have an outsized negative impact on the fortunes of WiseTech.

At the very least, White should take up his board’s suggestion to temporarily step aside, or at least map out a transition to a non-operational role and allow a new CEO to drive the business.

A split has now started to emerge between the WiseTech board and the company’s founder and largest single shareholder Richard White. It comes amid historical allegations the billionaire had engaged in inappropriate behaviour and in 2020 some previous board members had sought assurances from the technology boss around the matter.

That, and the emergence of a separate historical relationship White had allegedly developed over social media platform LinkedIn, has also given new focus for the technology company’s board.

Wisetech CEO Richard White has been embroiled in a scandal playing out in the courts.

New WiseTech chair Richard Dammery only took charge in April this year and now confronts the biggest crisis any independent chair could face: taking on the founder and biggest shareholders.

Dammery, a former Coles-Myer and Woolworths chief legal counsel, needs to show outside investors he is not a hostage to the WiseTech founder.

The first official comments by the board on Monday said it was now reviewing the matters raised and is actively seeking further advice. It continues to monitor the situation, but suggested it is not about to jump to conclusions.

“(The board) is conscious of the potential impacts on the company and will carefully evaluate all relevant factors in its assessment”.

This publication last week revealed Dammery had opened the door for White to stand aside while the tech billionaire was focused on a series of allegations emerging from a Federal Court case about White’s personal life. White had responded by saying he wasn’t going anywhere and remained “laser focused” on delivering the strategy.

The allegations by Sydney-based Linda Rogan claim White expected sex in return for his business advice. White hasn’t responded to requests for comment, and in his affidavits lodged with the Federal Court he has denied the allegations made against him.

While the WiseTech board has been meeting regularly to discuss the White developments, Dammery had regarded the allegations as personal in nature and had preferred for the legal proceedings to play out. The WiseTech board has also been taking external legal advice around its position.

Among the issues now facing Dammery as WiseTech chair will be what options are available to him as chair if the situation with White deteriorates. There’s always the potential for the position of CEO of any company to become untenable. In this case the CEO controls more than a third of the company’s share register.

The potential for disruption is immense, particularly given White, who built WiseTech from scratch, has become so intertwined with its strategy.

This means the board needs to show it knows exactly what is happening inside WiseTech, as well as the leadership team. Investors too need to grapple with how exposed they are to key man risk.

Regardless of the allegations, the pressure is on White to face up to the reputational damage starting to set in.

He has to recognise the business of WiseTech is much bigger than him. The billionaire needs to start putting some distance between him and the company he built.

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Originally published as Richard White needs to step aside to protect WiseTech