Research and Development

AWI grilled on 2019 election and agri-political activity claim

Terry Sim, March 24, 2021

AWI CEO Stuart McCullough gives evidence at Senate Estimates.

AUSTRALIAN Wool Innovation has been grilled over its 2019 board election nomination process and a claim of agri-political activity, at a Senate Estimates hearing yesterday.

Rural and Regional Affairs and Transport Legislation Committee member Senator Glenn Sterle yesterday questioned AWI chief executive officer Stuart McCullough about NSW wool grower Chick Olsson’s attempt to collect signatures supporting his 2019 AWI election nomination on a joint ticket with two other nominees.

Despite Mr Olsson’s claims that at least two joint tickets of multiple nominees were allowed in previous AWI elections, Mr McCullough told the senators:

“As I understand that is not correct, it makes no good sense that you can just go and get 100 signatures and put as many names of candidates on those 100 signatures, and potentially get all those nominations up with just 100.

“Every person who wishes to nominate for the board of AWI must go out and get 100 signatures of their own,” Mr McCullough said.

“What he wanted to do is put up 100 signatures, just 100, and put three nomination candidates on the top.”

When it was suggested Mr Olsson in 2019 received written advice allowing him to seek signatures on a joint ticket, Mr McCullough said he would have to check what was written to Mr Olsson, taking that on notice.

“But certainly the advice back from our legal counsel was, no,” Mr McCullough said.

Legal advice and AWI secretary texts sought

Australian Wool Growers Association director Chick Olsson.

Mr Olsson has told Sheep Central that the multiple candidate nomination form practice was used in 2007, for the Fletcher and Olsson ticket, and in 2008, for the collection of signatures for Laurence Modiano on a ticket also including Meredith Sheil, George Falkiner and David Webster. Mr Story was not the AWI company secretary at that time.

Mr Olsson then also claimed that Mr Story texted to him on July 23 2019:

“Chick, I am writing to advise that our legal advice is that it is permissible albeit unusual for you to have several candidates named on the nomination form.

“That will mean that the signatories on the form will apply for the 3 candidates as you outlined to me.”

However, Mr Story later confirmed to Mr Olsson via text that he would not be able to collect signatures for multiple candidates on one nomination form.

“Correct. No multiple candidates on one nomination form as we discussed. Jim,” Mr Story texted.

Mr McCullough said “it sounds right” that AWI after seeking legal counsel also wrote to Mr Olsson confirming he would not be able to collect signatures for a multiple ticket.

“So what I’ve got so far is that it was never the case that you can get multiple signatures for three nominations? Mr Sterle said.

“No, and if you think about the process that’s very logical, that can’t just put as many nominating candidates on the top of a page and just get 100 signatures,” Mr McCullough said.

Mr McCullough appeared to agree with Mr Sterle’s statements that “you (AWI) don’t run tickets” and have “never run tickets”, of multiple candidates in the nomination process.

Mr Sterle asked Mr McCullough to get the letters to Mr Olsson and he would check with Mr Olsson. Mr Olsson told Sheep Central today that he would provide to the Senate Mr Story’s 2019 texts to him and believed AWI should also provide to the committee the legal advice permitting several candidates on a nomination form, referred to by Mr Story in his 2019 text to Mr Olsson.

Proof of agri-political activity could shut down AWI – Sterle

Labor senator Glenn Sterle at Senate Estimates yesterday.

Mr McCullough confirmed that it would have been Mr Story that advised Mr Olsson he could not collect signatures for a multiple nominee ticket. The AWI CEO said there was no influence from a board member in the decision to disallow Mr Olsson’s multiple ticket.

“No, the only influence on this decision was from our legal counsel.”

When asked by the committee chair Senator Susan McDonald if he would table that legal advice, Mr McCullough said “sure”.

AWI directors are aware of SFA rule against agri-political activity – McCullough

In 2019, Mr Olsson claimed that there was AWI director interference and agri-political activity involved in his nomination process. Mr Olsson, with the Australian Wool Growers Association and peak body WoolProducers Australia, sought a Senate investigation into AWI’s board nomination process.

Mr McCullough agreed with Mr Sterle that under AWI’s Statutory Funding Agreement with the Federal Government, the Minister for Agriculture could shut down AWI if it was proven by a Senate inquiry to be involved in any agri-political activity.

“I’m aware of that clause …absolutely,” Mr McCullough said.

“Technically that’s correct.”

Mr McCullough said the other board members of AWI were also aware of the SFA’s stance on agri-political activity.

The SFA states that AWI must not engage in agri-political activity, which means “activities that involve engaging in, or financing with levy funds or matching payments, any form of external or internal political influencing …”

After Mr Olsson’s joint candidate nomination form was disallowed, Mr McCullough said Mr Olsson continued to collect signatures “and he didn’t reach the required 100.” Mr Sterle said he was told by Mr Olsson that he collected 134 wool grower signatures “allowing him to stand for election again.”

“That’s not actually correct, he didn’t stand at the 2019 board election because he didn’t get enough signatures,” Mr McCullough said.

“Now, even though you might collect 130, they’ve got to be verified and shareholder names, proper names.”

Mr McCullough said there are 35,000 eligible levy payers in the company, but only 19,000 have chosen to be shareholders.

“With this process, the company secretary works very closely with all those seeking nominations for the board and as their signatures come in they are verified by Link Market Services.”

Mr Sterle said “we all know of Mr Olsson’s past successes of being overwhelming elected to the AWI board”, because of his strong stance on surgical mulesing.

“Is there something that I’ve missed here, do you think that there is people that don’t think Mr Olsson maybe suitable for the board,” he asked.

“No, if Mr Olsson reached the 100 signatures, he would have been a nomination for the board of AWI, then you’ve got to get the votes on the day, the nomination is just ‘first base’,” Mr McCullough said.

Mr McCullough said he thought Mr Olsson submitted signatures for 97 eligible shareholders, but he took on notice the provision of the actual number.

“He wasn’t too far off, but then he kept putting them in and there is a closing date on this naturally, there has to be a shut off point and he expected signatures he got after that date to be put in.”

Mr McCullough said he didn’t know whether the eligibility of any signatures submitted after the deadline would have been looked at. He didn’t think there was any delay in Mr Olsson collecting signatures.

“We just told Mr Olsson that he couldn’t add two other names to his sheet,” Mr McCullough said.

“I don’t think we even saw any signatures, he was simply questioning whether he could go out and get 100 signatures and put three people’s names on the top, which is not how it’s done.

“I’m not sure that he had to start again,” he said.

“At the point at which he requested of the company whether he could three names at the top of 100 signatures, I’m not sure that he had any signatures with us at all.

“We kept a very good record of this and the legal advice that we took all the way through, because Mr Olsson was obviously on the phone, towards the end, a lot, with the company secretary.

“There was a lot of effort put into trying to get Mr Olsson to that point, of 100 (verified) signatures, but the bottomline is he didn’t get the signatures by the required closing date.”

AWI works very hard to get growers to become shareholders – McCullough

Mr McCullough said levy payers had to nominate to AWI to become shareholders, and AWI writes every year to its levy payers and ask whether they want to be a shareholder, advising them if they nominate they can vote in AWI elections and what shareholder information they can get.

“Senator, some of them don’t want to be shareholders, some of these levy payers are very small levy payers, hobby farmers and those sorts of things.

Mr McCullough said “in the order of 15,000” AWI levy payers are not shareholders –“I’ll get you the exact number.”

“We work very hard to try and have them become shareholders.”

Mr McCullough said he was not sure how close Mr Olsson got to the required 100 signatures.

“Link Market Services handle all this for us, they are the ones that do the verification of the signatures and they will have a very detailed record of the timing and how the signatures arrived.”

Mr McCullough said there were five nominations for three positions in the 2019 election.

When asked why Mr Olsson was not given the “benefit of the doubt” and allowed to have the extra signatures above the 97 validated for his nomination, Mr McCullough said he did not get the required number of signatures by the close-off time. The CEO said it would be unfair to the other nominated candidates who got 100 verified signatures to accept Mr Olsson’s nomination. He said the company’s rules clearly stated a deadline for verified signatures.

Mr McCullough said other people had also failed to get 100 verified shareholder signatures in previous elections.

“They have got to be the right signatures – you can’t put in a levy payer that is not a shareholder.”

He presumed Mr Story informed Mr Olsson he was ineligible to stand in the election.

Mr McCullough said he was not aware of “a conversation” among board members around who was nominating in elections.

“No, I’m aware of the people that are chasing these 100 signatures and I’m aware that Jim (Story) is actively working with Link Market Services to get them verified, but that information I don’t think is provided to the board – if they asked they could probably get it.”

Mr McCullough said he was not aware of anybody being denied the ability to run for the AWI board.

“You get the 100 signatures by the required date you are a nomination for a board seat.”

Can Chick Olsson use his 2109 signatures this year?

Mr McCullough said he would have to check if Mr Olsson’s 99 signatures collected in 2019 would allow him to stand for this year’s AWI election, meaning he needed only one more signature to stand again.

“I would have to check that Senator Sterle, but that’s sounds illogical to me, they could have dropped as a shareholder for example, and to simply dust off something that, you know …

“People nominate, they put their signature down because they support that candidate and he could have lost support over that period of time,” he said.

“So I think the rules will probably say that you must seek another 100 signatures, and he could go to the same people obviously, and if they sign up by the required date and time, he will get on.”

Mr Sterle then asked Mr McCullough if he knew of any agri-political issue that he or any board members wanted “to allude use to or is everything in hand?”

“No, I have nothing to declare there,” Mr McCullough said.

Senator McDonald told Mr McCullough that the RRATL committee expected that a company’s CEO and CEO would attend estimates hearings and she expected to see him and AWI chair Colette Garnsey at the next budget estimates.

“I’ll make the board aware,” Mr McCullough said.

AWI company secretary Jim Story also did not attend Tuesday’s hearing.

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