‘Shameful’: Tech Council facing questions over Richard White saga

Shares in WiseTech Global skyrocketed after the resignation of its embattled billionaire CEO Richard White, but questions are now turning to why the Technology Council of Australia took nearly a week to deal with serious allegations of misconduct by one of its board members.

Investors warmly welcomed White’s resignation on Friday, sending WiseTech more than 20 per cent higher early on Friday after some $8 billion in value was wiped out during the week. The rebound also added about $2 billion back to White’s personal wealth, given he still owns more than one-third of the company he founded three decades ago.

WiseTech Global told investors on Thursday White would take a brief break before taking up a “full-time, long-term consulting role” where he will be paid the same annual salary – $1 million – that he receives as chief executive.

Richard White resigned as WiseTech Global CEO on Thursday.Credit: Dominic Lorrimer

It followed an investigation by The Sydney Morning Herald, The Age and The Australian Financial Review that revealed White paid for a multimillion-dollar house for an employee, and had been accused by an outgoing WiseTech Global director of intimidation and bullying.

“It has been a challenging time for me personally, my family and close friends, and for the company that I have built and truly love,” White said in a statement.

“I want to assure all those who have supported WiseTech, as customers, colleagues, and shareholders, that I remain absolutely committed to seeing this incredible organisation continue to thrive and grow in the coming years.”

Citi analysts welcomed White’s resignation and upgraded their recommendation on WiseTech shares to “buy”, despite ongoing questions around the power White will still wield in his next role.

“While we see increased uncertainty with the leadership transition arrangement and believe some investors may see still lingering corporate governance issues, we do think the board and Richard White have come to a solution whereby governance and strategy have been effectively separated,” Citi analysts wrote in a note.

Governance experts are turning their attention to WiseTech’s board, and its role in the saga. Swinburne University law and governance specialist Helen Bird said White had the board “in a thrall” and will now have to consider how effective its oversight over company operations had been.

“There are also question marks over succession planning and the steps involved in finding a new CEO, who will have to manage the company and cope with the company’s powerhouse consultant who also happens to be its majority shareholder.”

Meanwhile, Australia’s powerful technology lobby group has been slammed for its “glacial” response to White’s alleged inappropriate behaviour.

The Tech Council had been under growing pressure over the past week to remove White from its board, before he resigned late on Thursday. The Tech Council is chaired by Tesla chair Robyn Denholm, who told members that White’s board position would remain vacant until its next annual general meeting. Other TCA board members include Atlassian co-founder Scott Farquhar and former NSW customer service minister Victor Dominello.

Joan Westenberg, a writer and veteran of the start-up sector, said the Tech Council’s handling of the situation had been “shameful.”

“Their glacial response to the crisis, only accepting White’s resignation after significant member pressure, shows an organisation more comfortable with performative initiatives and hashtags than actual governance, oversight or responsibility,” Westenberg told this masthead.

Joan Westenberg said the Tech Council’s handling of the White situation had been “shameful.”Credit: SMH

“The irony of an organisation publishing advice for girls about how to #breakthebias while failing to act against White is not lost on me.”

Westenberg also labelled WiseTech’s decision to keep White on as a consultant a “cop out”.

“It perfectly exemplifies the tech industry’s chronic inability to fully sever ties with problematic leaders,” she said.

“The arrangement is designed to save face and protect White’s precious feelings rather than to implement meaningful change.

“The tech industry has a persistent founder worship problem. When we elevate tech leaders to near-mythical status, we shouldn’t be surprised when the fall from grace is equally spectacular.”

Sam Garven is the co-founder of Canopy, a platform that helps employees report misconduct and psychosocial concerns, and helps businesses prevent them from happening.

“The TCA is meant to be the guiding light of our tech sector, and that light needs to extend to ethics,” she said. “While the decision for White to step down was quite obviously made for him, it took a giant public push to make it happen. This shouldn’t be the case.

“The TCA has the chance now to take a good hard look at what could have been done differently to address this behaviour earlier. They have the chance to set a new standard on what we expect from businesses and those who hold power within them. Until we do that, the message we’re sending is that some people in the ecosystem are more deserving to be a part of it than others.

“We need to show women, and anybody else who is brave enough to speak up, that their concerns are heard, and valid.”

A spokeswoman for the Tech Council defended the organisation’s processes and the time it took for White to step down.

“The Tech Council of Australia followed a rigorous governance process led by the board chair, which included working with legal counsel to address this matter as quickly as possible.

“Richard White stepped aside from his public duties as director within 48 hours of the matter arising, and has now resigned from the board; appropriate due diligence was undertaken at all stages of the process.”

Damian Kassabgi is the CEO of the Tech Council.Credit: SMH

Kayla Medica, startup industry veteran and author of marketing book The Mehdeeka Method, said that WiseTech’s brand had been too closely tied to White, who co-founded the company 30 years ago.

“Perhaps the best move here from a business perspective is to detach the idea of one person being responsible for the company’s success to date, but WiseTech isn’t sending those signals,” she said.

“Seeing as the board has announced intentions for White to not fully leave the business but take on a different consultative role, the business’ reputation may take even longer to repair. There’s no real punishment here either. You could consider this new consulting role a step towards retirement he was probably already thinking about anyway.

“The decision also inadvertently speaks to the values of the company and what it’s willing to stand for, which in this case is not a lot. The scandal will undoubtedly continue to plague the company.”

White’s departure came on the same day as the release of a report from women-led collective Grapevine that found sexual harassment and discrimination remain rife in Australia’s technology sector.

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