After ousting Alexander, Crown’s Coonan makes desperate pitch to save her own job
You couldn’t make this stuff up. Former executive chairman of Crown John Alexander had been the victim of a coup in January staged by the now chairman and former Liberal senator, Helen Coonan, and mounted while he was out of the country.
It was a startling beginning to Tuesday’s inquiry into Crown.
Although Coonan took issue with the “coup” label, the fact Alexander gave up the chair unexpectedly and was given an unspecified and untitled executive position with no apparent duties other than to show the ropes to his replacement, chief executive Ken Barton, always seemed strange.
As the inquiry has repeatedly heard Barton, who had been chief financial officer, was in the thick of Crown’s operations.
Alexander’s plank walking exercise was richly rewarded with a $3.5 million pay package for a year’s work – more generous even than Barton’s salary. The announcement didn’t expressly say Alexander would leave in the year but anyone that made inquiries was made aware that was the deal.
Coonan’s take on January’s management and board upheaval was that it was a nod to non-Packer shareholders who were looking for a more conventional governance strategy. Anyone that has followed the Crown inquiry over the past few months will find that concept jarring/gobsmacking and even laughable.
Important information and decisions about the operation of the business were ring-fenced inside an inner sanctum – a handful of Crown executives and Packer operatives. Thus normal reporting lines were bypassed.
The removal of Alexander and the creation of a chairman’s role distinct from the chief executive role feels largely cosmetic when seen against the bigger problems within Crown.
Helen Coonan’s time in the witness box these past days is tantamount to her application to remain as chairman – her pitch being she will become a change agent for an organisation in desperate need of an overhaul.
She told the inquiry she was “invested” in Crown’s future. It remains to be seen whether she will have the opportunity to make a return on that investment.
Her pitch was certainly not helped by her admission that she may have known about an AUSTRAC investigation, announced by Crown on Monday, but had failed to mention it during her first day of giving evidence on Friday.
Coonan’s was a desperate attempt to argue that Crown 2.0 will emerge as a more conventional company with a proper structure, a raft of new management, and new compliance operatives having hired a swath of external consultants to write reports on what went wrong and how it can be avoided in future.
That’s the “go forward” piece. And it’s up to Bergin whether she will take this on faith.
If she doesn’t Crown risks having to postpone the opening of its Sydney casino – and that isn’t the worst outcome. It is possible Bergin will recommend that Crown loses its NSW licence.
The tricky part for all the Crown directors that have filed into the virtual witness box – many of whom want to retain their seats on the board – is that they sat aloft in this organisation with a duty to oversee the company’s risk, governance, compliance with anti-money laundering laws. All this during periods where the company failed in each area.
All tried to walk the delicate balance between acknowledging Crown’s failings, defending some of them and justifying their role.
It was clear from Commissioner Patricia Bergin’s comments and questions that she needs to be comfortable that the current Crown regime can oversee its massive cultural overhaul. She appears equally interested in whether the current casino regulatory regime is fit for purpose.
The independent directors relied heavily on the fact that they were unaware of the problems within Crown because they were deprived of information from management. It is a defence that only goes so far.
While the inquiry was partly initiated on the back of a series of reports in 2019 from this masthead and 60 Minutes, there have been numerous media exposés about Crown’s association with junket operators with links to organised crime.
Some directors – bizarrely – admitted to not having been aware of them. Some were not aware of the Chinese government’s crackdown on foreign casinos – an issue well canvassed in the media. Most directors admitted to having no real knowledge or skills around anti-money laundering.
The one thing most directors had in common was some kind of prior dealings or relationship with James Packer. Coonan’s history with the Packers goes back to her time as federal Communications Minister when the Packers were heavily involved in the media industry.
And if Packer is ultimately required to sell or sell down his stake in Crown it is difficult to see how any or all can survive without his support. Indeed Packer indicated in his evidence that changes to the board are needed alongside independence.
It has already become clear that large minority shareholders are planning to vote against three directors up for re-election at the company’s annual meeting on Thursday.
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Source: Thanks smh.com