AWI chairman Wal Merriman to stay while shareholders support him

Terry Sim, October 18, 2017

AUSTRALIAN Wool Innovation chairman Wal Merriman has indicated he won’t be resigning despite calls to stand down, after he swore at an ABC reporter for questioning him about the AWI leader’s covert observation of Merino breeders behind a one-way mirror.

On June 15 this year, Mr Merriman asked to join an AWI-commissioned focus group of MERINOSELECT breeders invited to Sydney to discuss sheep genetic tools and AWI investments.

Despite not being invited by the Axiom Research researchers nor AWI staff managing the project, Mr Merriman, who is a co-principal of the Merryville Merino Stud, was allowed to observe the breeders behind a one-way mirror without their permission, even though they had been promised anonymity and confidentiality. Sheep Central broke the original ‘The Merino man behind the mirror: AWI’s Wal Merriman’ on September 6.

When an ABC reporter last week sought to question Mr Merriman on the ‘man in the mirror’ incident, Mr Merriman called the ABC journalist a “useless prick” and told him to “f— off, report that”.

Mr Merriman’s behaviour has prompted Australian Wool Growers Association president and AWI shareholder Robert McBride to call for Mr Merriman to stand down from the AWI board. Mr McBride told Sheep Central, Mr Merriman’s behaviour was “deplorable” and “disrespectful.”

“It is not something that is conducive to our wool industry in the past, present or future.

“I just think he should stand down.”

Mr McBride said he had asked Mr Merriman to write personal letters of apology to the MERINOSELECT breeders. He said the ABC incident did not present the Australian wool industry well at a national nor international level.

“I really do feel that it is doing damage to the wool industry as a whole and I believe that Wal should stand down and make way for the likes of re-standing director Paul Cocking and new nominee Don Macdonald.”

“We need people of that calibre to run on the board and the independence of the current board must come into a degree of question.”

AWI chairman’s language “unfortunate”

A statement from AWI corporate communications manager Marius Cuming said the language used by the AWI chairman towards the ABC last Thursday night was unfortunate.

“The ABC reporter was invited to a private function with over 130 growers present, designed to celebrate the success of the International Woolmark Prize but his approach was disingenuous.

“After being told in person by both the chairman and the CEO that neither wild be making a statement, the reporter ambushed them both towards the end of night, did not declare he was recording at the time and deliberately sought to intimidate to seek a reaction,” the statement said.

“The issue of media intimidation of AWI and misleading coverage of the wool industry at a time of great optimism was raised at the Industry Consultative Committee which met earlier in the day.”

Merriman to stay with shareholder support

Mr Merriman today told Sheep Central he would stay on the board while he had shareholders’ support.

“I will be staying there (on the board) while ever the shareholders want me.

“AWI shareholders and growers enjoy the freedom of a vote of choice for their elected representatives and my fate will be decided by the shareholders.”

However, under the current system of director rotation, as the AWI leader is not up for re-election in the 2017 AWI board election, AWI shareholders wanting to vote on Mr Merriman’s future might have to wait until he is next up for re-election, which might not be until 2021. AWI board member Colette Garnsey was elected to the AWI board in 2011 and is standing for re-election this year against fellow director James Morgan (2013) and Paul Cocking (2013), and new nominees Will Wilson and Don Macdonald.

Under AWI’s constitution, at every annual general meeting held in a rotation year, one-third of the directors (other than a managing director under Rule 14.2), or if the number of directors is not a multiple of three, then the number nearest to but not less than one-third, must retire from office.

The directors to retire are the directors or director longest in office since last being elected. As between directors who were elected on the same day the directors to retire are (in default of agreement between them) to be determined by ballot, the AWI constitution says.

AWI chairman is appointed by the board

WoolProducers Australia chief executive officer Jo Hall said the position of the AWI chair, is actually a board appointment, not a shareholder decision.

“As an industry owned company, AWI emphasises the fact that director elections enable growers to determine who sits on the AWI board and make decision on levy expenditure on their behalf.

“It is also often stated that if levy payers don’t like how their money is spent they can vote directors off,” she said.

“Whilst this is factually correct, the issue is with the provisions held in the AWI Constitution, whereby elections are held every two years and according to AWI’s constitution.

“This means that an AWI director can legitimately sit on the board for six years before they have to face an election,” Ms Hall said.

“WPA doesn’t deem this agile enough for wool growers to have sufficient say in the direction of their company.”


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  1. Simon Wells, October 23, 2017

    The AWI model is broken, riven by a raft of issues including:

    1. Poor corporate governance.
    2. A lack of required skills at board level.
    3. Unresolved conflicts of interest.
    4. Lack of transparency in decision-making.
    5. Sinecures.
    6. Nepotism (who you know,not what known)
    7. Bullying.

    The core issue is the model. Farmers are given their shares, they don’t buy their AWI shares. Acquiring shares by default means many place a lesser value (read interest) in these shares. Thousands of AWI shareholders take no interest in their shares, and never vote at an annual general meeting. This complacency allows the motivated minority to seize control and promulgate an agenda that may not be in the best interests of the majority of shareholders.

    Countless millions of dollars are spent where the board sees fit. Given the performance of AWI, Senate Estimates may be the start of finding a path out of this quagmire of wasted opportunities.

  2. Tony Connellan, October 20, 2017

    Shouldn’t you declare your conflict of interest, Michelle?
    While you’re entitled to your opinion, Wal Merriman is a long-standing LBS client of yours, is he not?

  3. Martin Oppenheimer, October 19, 2017

    The AWI board better act quickly to improve governance, relationship with media and other stakeholders, and conflicts of interest, or the whole house will come down. The board nomination committee is compromised and open proxies favour the narrow agenda of the chairman.
    Tick, Tick, Tick.

  4. Duncan Banks, October 19, 2017

    I am a shareholder and I do not support him. Re Mulesing: the customer is always right, even when the customer is wrong and they are looking for ethically produced wool.

  5. Michelle Humphries, October 19, 2017

    Despite the noise on Twitter, most hard-working, down-to-earth wool growers support AWI chair, Wal Merriman. This is because they respect and are grateful for his commitment to the wool industry, his vast knowledge of the whole supply chain, his understanding of the players involved and their motives, and his inherent desire to spend wool growers’ levies in the most cost-effective manner. These wool growers don’t have a media voice, but they have shareholder votes, so Mr Merriman will very likely stay.

  6. Noel Henderson, October 18, 2017

    There is a big difference between unfortunate and inappropriate. AWI is meant to stand as the pre-eminent organization for the leading quality wool producing country in the world. The public profile of AWI is slipping and reflecting on all wool growers.
    As wool growers, we expect better than this.

  7. Jim Gordon, October 18, 2017

    It is time to move to small grower groups; 10 to 130, for example. Those grower groups can control their research. Marketing is being handled by the manufacturers. The grower groups can zero in on their particular market.

  8. Dale Price, October 18, 2017

    I believe it is time AWI’s performance reflected the last word in the organisation’s name -‘Innovation’. The board and arguably more accurately, the chairman’s lack of support for genetic improvement, has to be questioned. In other respects, I welcome a report that shows a direct alignment with marketing expenditure. I strongly suspect that any lift in wool returns is a reflection of supply rather than demand, driven by our expensive marketing campaigns.

  9. Andrew Farran, October 18, 2017

    The art of getting on is knowing when to come and when to go. It’s obviously up to you Wally the way things are.
    No one is indispensable.

  10. Martin Oppenheimer, October 18, 2017

    I am a shareholder and I do not support him.

  11. Jim Gordon, October 18, 2017

    Thank you for your comments Ms Hall. I agree with WPA. Someone please, put in place an alternative to give wool growers a choice of organisations to pay their levies to. This situation will never be fixed until that happens. Then we can once again have control of our destiny. Surely, there is someone, or a group of people, that can make this happen.

  12. susan finnigan, October 18, 2017

    Excellent cartoon. It’s not nice to call anyone a ‘useless prick’ – so I will say nothing, but 2021 is a long time to wait.

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