Back from the brink
The former chairman of an Australian mining company which lost its entire board in an African air crash says New Zealand companies should plan for the worst.
The six directors of listed company Sundance Resources were killed in 2010 when their plane crashed in dense jungle near the border of Cameroon and Congo, a remote mountainous area in central Africa.
‘‘This is deep dark Africa,’’ retired chairman George Jones told the Institute of Directors leadership conference on Tuesday.
The C212 Aviocar was flying from Yaounde, Cameroon, to a tiny dirt airstrip near the company’s undeveloped iron ore project at Mbalam.
All 11 people on board died in the crash. They includedSundance chairman Geoff Wedlock, managing director Don Lewis, company secretary John Carr-Gregg and directors John Jones, Craig Oliver and one of Australia’s richest men, Ken Talbot, worth an estimated A$965 million ($970m).
Jones had retired as chairman of Sundance about three months before due to illness and all but one of the Sundance executives on the flight were people he had appointed and personal friends.
‘‘The Sundance management that I had left was first class, some of the best in the business . . . Almost certainly if I hadn’t have retired I might have been on the flight myself.’’
Immediately after the disaster Jones was called in to manage the crisis, as there was no living person who knew the company better.
Sundance survived the crisis and continues to develop its Mbalam iron ore project.
But a similar incident in Australia in 1987, when a plane carrying another mining com- pany’s entire board crashed near Kalgoorlie, led to the company’s collapse.
That company had considerable debt and following the crash no one stepped in to manage the crisis, he said. Eventually five companies were liquidated, five mines closed, 1600 people lost their jobs and 7000 investors lost their entire investment.
Jones did not want to see Sundance suffer the same fate. Fortunately a sophisticated disaster management plan had been put in place by the board before the crash happened.
Knowing there was going to be a media storm once news got out, Jones formulated a media plan and fronted all interviews.
‘‘I didn’t want the people running the search programme distracted by the media.’’
A plan was also made to deliver news of the crash to the families and alert the Australian Securities and Investment Commission, the Australian stock exchange, banks, shareholders, staff and relations with various governments.
A new board had to be appointed. A voluntary trading halt was put on Sundance shares and funds were released from the company’s bank account to help fund the search, despite the bank initially declining access, he said.
In the weeks after the disaster Jones talked with five chairmen who said they had all been on a flight with their entire board in the previous three months.
Jones said while it could be more expensive and less convenient to put board members on different flights it was essential to the survival of a business should a crisis occur, he said.
‘‘Anything can happen and in risk management you’ve just got to cover all contingencies from one extreme to another.’’
If a business could not afford to put board members on different flights they should not be flying anywhere, he said.