AWI’s spending, governance ​pressure ups

Mounting pressure on Australian Wool Innovation's governance and spending


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AWI chief executive Stuart McCullough, AWI chairman Wal Merriman and Department of Agriculture secretary Daryl Quinlivan, during Senate Estimates in Canberra recently.

AWI chief executive Stuart McCullough, AWI chairman Wal Merriman and Department of Agriculture secretary Daryl Quinlivan, during Senate Estimates in Canberra recently.

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Australian Wool Innovation has been accused of exploiting loopholes in the industry’s constitution amid revelations of excessive professional development spending.

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WoolProducers Australia has accused Australian Wool Innovation (AWI) of exploiting loopholes in the industry’s constitution amid revelations chief executive Stuart McCullough spent about $100,000 of levy funds to attend a six-week university course in the United States.

AWI is in damage control over news reports the compulsory levy-funded company approved the trip to send Mr McCullough, who earned more than $422,000 a year, to Stanford University in 2013, saying it was in line with the organisation's policies. 

The turbulent time has led WoolProducers (WPA) to call for constitutional changes at AWI, to include mandatory reporting of proxy numbers and casting direction.

“As the wool levy is a compulsory tax on woolgrowers and there is no ability for growers to sell or trade their shares in AWI… there must be far more transparency and accountability in the way AWI currently operates,” WPA chief executive Jo Hall said.

“The AWI constitution allows for a number of things to occur that are not of high standards of accountability to shareholders, namely woolgrowers.

 “While growers do not have the option to opt out of the company, AWI has a duty to be as open as possible with their major funders - woolgrower should expect nothing less.

“There is also a huge responsibility on AWI to be accountable to everyday tax payers who also contribute tens of millions of dollars to them.”​

Queenlsand Senator Barry O’Sullivan recently requested AWI remove a clause in its constitution which enabled the use of undirected proxies, during a Senate estimates hearing.

“Here's the assertion: a member of the board has manipulated proxies, gathered them and used them to influence the outcome of (AWI) free (board) elections,” Senator O’Sullivan said. 

“You need to decline them and your board needs to add to your charter, your code of conduct, that board members will not ever in the future receive proxies to apply in a free election for a board member” Senator O’Sullivan said.

“Here's the assertion: a member of the board has manipulated proxies, gathered them and used them to influence the outcome of free elections for board members of the AWI.

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“You've done nothing so far to satisfy me that the potential for that exists.”

AWI secretary Jim Story said there were rules in corporate law about warehousing of votes.

An AWI spokesperson guaranteed the chairman casts all directed proxies as directed by the shareholders’ instructions, and said “AWI complies with law”.

An AWI spokesperson guaranteed the chairman cast all directed proxy votes in accordance with the shareholders instructions.

“In practice, directed proxies are simply tallied up,” he said.

“There is no discretion for the proxy holder to vote differently from what the shareholder has completed. 

“Importantly, if a person were to cast a proxy vote in a manner contrary to their instructions they would contravene the Corporations Act and commit an offence.” 

The story AWI’s spending, governance ​pressure ups first appeared on Farm Online.

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