NEW chairwoman of Australian Wool Innovation Colette Garnsey has distanced herself from the position of controversial former chief, Wal Merriman, less than one week after announcing he is stepping down.
In her first run of public interviews since taking on the top position, Ms Garnsey set a three-year timeline to overhaul the governance of AWI, and said she disagreed with Mr Merriman’s claims the wool body would become insolvent if a 1.5 per cent levy was voted in.
Her views coincided with the announcement AWI will go to a preference count for the first time in history after none of the options put to woolgrowers received the required 50 per cent majority on the first count.
On Wednesday, AWI convened a meeting of the WoolPoll panel to endorse the counting of preferences to determine the final compulsory wool levy.
Ms Garnsey said AWI would “cut our cloth” to work with whatever budget was allocated.
She said the only circumstance that would see AWI become insolvent would be if it never trimmed its budget and expenditure, “and that’s simply not reality”.
Last month, the industry body reported a record financial reserve of $120 million.
“We are a company that constantly looks at our forecasts, constantly looks at our income, and ensures that we’re completely operationally sufficient,” Ms Garnsey said.
Her comments were in conflict with Mr Merriman’s claims at senate Estimates recently, where he said a drop from 2pc to 1.5pc would render AWI insolvent.
However, with widespread drought and an unprecedented fall in the wool market, Ms Garnsey understood the increase in votes for a 1.5pc levy.
“We understand that there are tough times right now in a number of areas in Australia, in regards to drought,” she said.
“If that’s the decision, we will cut our cloth in order to be able to continue to deliver efficiently and productively for our growers.”
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In a controversial move, Mr Merriman will remain on the AWI board of directors, despite calls he should step down from the industry group entirely.
Australian Wool Growers Association chairman Rob McBride said it was critical he stood down to avoid his directorship being seen as “potential shadow chairmanship”.
But Ms Garnsey said she greatly appreciated Mr Merriman’s willingness to remain on the board, to ensure a “smooth transition”.
She said Mr Merriman would remain on the board until at least November 2019, when shareholders would next elect its directors.
She said she felt supported by the rest of the board who unanimously voted her in.
“I have no doubts about my abilities to lead this company,” she said.
Ms Garnsey said it would not be “physically possible” to adopt all 82 recommendations, laid out in a review into the wool body’s governance, by the annual general meeting later this month.
She said she was instead working on a three-year timeline.
This is despite constant calls from Federal Agriculture Minister David Littleproud to “show some leadership” and immediately adopt all recommendations.
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She said there were a couple of recommendations that would go to shareholders at the Extraordinary General Meeting (EGM) early next year, as “these are matters that only shareholders can decide on”.
She did not disclose what these recommendations were, but said one was related to director terms.
“I’m looking forward to the support of other players in the industry in consulting them in order to build a stronger industry,” she said.
Despite months of public pressure, Ms Garnsey said Mr Merriman had realised now was the right time for leadership change.
“I think he felt it was time for him to make the decision to stand down, which he’s done,” she said.
She dismissed claims that his decision had anything to do with the Ernst & Young review, WoolPoll, or any other controversies that had impacted his reputation of late.
Mr Littleproud thanked Mr Merriman for his service to the wool industry, and said now was a “logical time” for him to step down.
“He will leave a legacy few will forget,” Mr Littleproud said.