Board re­signs

Mur­ray Ir­ri­ga­tion di­rec­tors act to ad­dress dys­func­tion

Southern Riverina news - - FRONT PAGE -

A full-scale re­form of the Mur­ray Ir­ri­ga­tion Lim­ited Board struc­ture is un­der­way.

It was sparked by the res­ig­na­tion of all its mem­bers on Fri­day af­ter­noon, with all seven agree­ing to stand down at the Novem­ber 28 an­nual gen­eral meet­ing.

Chair­man Bruce Simp­son, in a state­ment re­leased on Fri­day, said all di­rec­tors had agreed to stand down. This in­cluded him­self, in­de­pen­dent di­rec­tor Ben Bar­low, and share­holder elected di­rec­tors Mark Robert­son, Chris Brooks and John Brad­ford.

Mr Simp­son said the de­ci­sion was sup­ported by cur­rent Board mem­bers Tim McKind­lay and James Sides.

Mr Sides was not re-elected un­der con­tro­ver­sial cir­cum­stances in the re­cent elec­tion, when a let­ter from the Board to share­hold­ers en­dorsed only two of the three ex­ist­ing di­rec­tors — Mr Simp­son and Mr McKind­lay.

Mr McKind­lay and Mr Sides were due to be re­placed by first-time di­rec­tors Waan­der van Beek and Phil Snow­den from the end of the an­nual gen­eral meet­ing, how­ever they have also agreed to re­sign from their elected po­si­tions.

Mr Simp­son was yes­ter­day locked in meet­ings with se­nior staff to de­ter­mine the process go­ing for­ward.

Spe­cific de­ci­sions on the in­terim gov­er­nance struc­ture and tim­ing on a new di­rec­tor elec­tion had not been de­cided at the time of go­ing to print.

How­ever, in what Mr Simp­son said was an express aim to in­stil more con­fi­dence in de­ci­sion mak­ing, the com­pany has al­ready ear­marked in­creas­ing the num­ber of inde- pen­dent di­rec­tors on the board from one to three.

It is pro­posed that an eighth Board po­si­tion be filled by re­clas­si­fy­ing the com­pany’s chief ex­ec­u­tive of­fi­cer to a manag­ing di­rec­tor. This would give CEO Michael Rene­han a seat on the Board.

Mr Simp­son wants the re­form process to also look at a ‘‘rig­or­ous as­sess­ment’’ of can­di­dates for the pend­ing Board elec­tions.

The pro­posed changes have all stemmed from an in­de­pen­dent re­view of the Board’s per­for­mance, which found it to be dys­func­tional.

In a let­ter to the edi­tor (page 12), Mr Simp­son said the Board had dis­cussed a num­ber of sce­nar­ios on how to quell share­holder con­cern over the re­sults of the in­de­pen­dent re­port.

This re­port has not been made pub­lic, de­spite nu­mer­ous calls from share­hold­ers.

In the end, Mr Simp­son said full res­ig­na­tion was con­sid­ered to be the best, and a ‘‘con­struc­tive path­way to achieve Board re­form’’.

‘‘We have now reached a time when the process of real Board re­form needs to be ac­cel­er­ated,’’ Mr Simp­son said.

‘‘At the end of it, share­hold­ers will have can­di­dates who have been vet­ted by an in­de­pen­dent com­pany to en­sure they have the ap­ti­tude, in­tel­lect, ba­sic skills and at­tributes wor­thy of sit­ting on the Board of a com­pany that op­er­ates crit­i­cal in­fra­struc­ture vi­tal to the liveli­hood of peo­ple and busi­nesses across the MIL foot­print.

‘‘No longer will any mem­ber of the Board be sub­ject to the in­flu­ences of any group whose ob­jec­tives dis­tract from the com­pany’s core business: wa­ter de­liv­ery, the Board’s le­gal re­spon­si­bil­ity un­der the Wa­ter Man­age­ment Act and the op­er­at­ing li­cence the com­pany op­er­ates un­der.

‘‘The com­pany will con­tinue to un­der­take ad­vo­cacy on is­sues that im­pact our obli­ga­tions un­der our op­er­at­ing li­cence.

‘‘Let us put di­vi­sion be­hind us, let us put our en­ergy into re­form and progress, into unity and col­lab­o­ra­tion, into build­ing a strong, pros­per­ous re­gion.’’

An in­terim gov­er­nance struc­ture will be put in place from the end of the an­nual gen­eral meet­ing.

The com­pany is seek­ing in­de­pen­dent ad­vice on how this will pro­ceed.

‘‘That ad­vice will also de­ter­mine when an elec­tion of di­rec­tors should be held and in what for­mat,’’ Mr Simp­son said on Fri­day.

‘‘Can­di­dates will be sub­ject to rig­or­ous as­sess­ment by an in­de­pen­dent, top-tier se­lec­tion com­pany and the new Board is likely to in­clude four share­holder di­rec­tors and three in­de­pen­dents.

‘‘The CEO’s po­si­tion will be­come a manag­ing di­rec­tor ap­point­ment, sub­ject to a change in the com­pany’s con­sti­tu­tion.

‘‘No one knows more about the business than its most se­nior man­ager and as such it is im­por­tant for that po­si­tion to have an equal voice at the Board ta­ble.

‘‘The Board’s mod­erni­sa­tion also calls for a re­newed re­la­tion­ship with land­holder as­so­ci­a­tions and an in­creased role for those as­so­ci­a­tions to play in ef­fec­tive, in­dus­trial strength ad­vo­cacy.

‘‘We are work­ing on a Me­moran­dum of Un­der­stand­ing and hope to have it con­cluded by the end of the year.’’

Mur­ray Ir­ri­ga­tion ex­ec­u­tive man­ager cor­po­rate af­fairs Peter Smith said share­holder con­sul­ta­tion will also be vi­tal in mov­ing for­ward with the changes.

‘‘The im­por­tant thing is that we need to have the cor­rect level of con­struc­tive con­sul­ta­tion. This is new ter­ri­tory for Mur­ray Ir­ri­ga­tion,’’ Mr Smith said.

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