WoolProducers Australia questions AWI governance standards

11 September, 2017

Peak woolgrower representative body WoolProducers Australia (WoolProducers) is still waiting for answers from Australian Wool Innovation (AWI) regarding the revelations of the Chair covertly watching a confidential grower focus group.

The incident, reported by Sheep Central and verified by the stud breeders involved, raises serious concerns around the governance of the industry’s service body, including potential conflict of interest.

WoolProducers President Richard Halliday today said ‘WoolProducers do not believe that it is appropriate conduct for any board chairman to be watching a confidential focus group unannounced – it is unethical.’

The incident occurred in June and there has been at least one AWI Board meeting since that time. WoolProducers are asking if the AWI Board were made formally aware of the incident prior to or at the 1 September, 2017 board meeting?

‘If the AWI Board knew about this before the publication of the article on 6 September, there is an expectation that levy payers would have been informed through a formal statement.’

‘However, if this issue wasn’t raised with the Board by the Chair or CEO, this has implications around if the Board should have been informed before it became public?’ Mr Halliday said.

The only reference provided by AWI, to date was reported on 7 September, stating that it was not unusual for meetings to have observers, indicating that it was not normal practice and that this will not happen in the future.

‘It is not unusual for meetings to have observers, but it is not acceptable to have an observer covertly watching a meeting when participants have been assured of confidentiality. The Chair’s presence was not disclosed to any of the participants, and at the end of the day he chose to remain and observe the meeting behind a mirror.’

‘It’s a given that this should never happen again, but it is unbelievable that it happened in the first place – this statement does not provide any justification or explanation of the Chairs actions.’ Mr Halliday said.

This incident highlights the concerns that WoolProducers have with the current wool industry structure. WoolProducers has long been advocating the need for arms-length industry oversight of AWI, in the interests of all wool levy payers.

As an industry owned organisation, AWI state that wool levy payers have a democratic mechanism to direct the company through director elections and voting on the wool levy.

‘AWI actively promote the ability of levy payers to vote directors off the Board or vote 0% in WoolPoll if they are unhappy with the company or Board’s performance. Neither of these options can be done in a timely fashion, they are reactive and place growers in the untenable position of having to weigh up the value of investment in industry research and development against the performance of the Board.’

‘This essentially means that if levy payers want to make meaningful changes to the Board or levy, the industry must be in crisis so a spill of the Board is called for or growers are forced to vote for no levy.’

WoolProducers is of the firm belief that this is unacceptable for the wool growing industry.

‘Woolgrowers deserve a much better system and this is why WoolProducers will continue to call for structural reform within the wool industry.’ Mr Halliday said.

ENDS

WoolProducers Australia contact:

Jo Hall

Chief Executive Officer

0488 554 811