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Former AWI chairman Merriman ready to re-stand in 2019

by Terry Sim, 23 November 2018
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FORMER Australian Wool Innovation chairman Wal Merriman stands ready to stand again for the board in direct contravention of a recommendation of the company’s recent independent EY performance and governance review.

AWI chairman Wal Merriman at Senate Estimates recently.

At the 2018 AWI annual general meeting in Sydney today, new AWI chair Colette Garnsey declared Mr Merriman was prepared to stand again, pending the outcome of an extraordinary general meeting in mid-March next year.

The EY review made 82 recommendations to improve the performance and governance of the wool research, development and marketing company, including a recommendation for a 10-year cap on director terms and two-year roll-off period.

Mr Merriman, who joined the AWI board in 2004 and became chairman in 2008, resigned from the top job earlier this month, but has elected to stay on the board.

About 100 people attended the meeting in one of the most highly-attended AWI AGMs in years. Wool growers several times applauded and gave Mr Merriman a standing ovation when Ms Garnsey and others lauded the former chairman’s contribution to the industry.

However, during question time, Australian Wool Growers Association of Australia president Robert McBride said although he was happy with the performance of AWI staff and thanked Mr Merriman for his significant time and effort with AWI, he believed Mr Merriman should leave the board.

Citing the recent 1.5pc WoolPoll vote result, and damage done to AWI’s relationship with the Senate, the government and media after Mr Merriman’s ‘man-in-the-mirror’ incident and his swearing at an ABC journalist, Mr McBride asked was it now time for Mr Merriman to resign to give the board and its new leaders, Ms Garnsey and new deputy chair Meredith Shiel, a “fresh start”.

Ms Garnsey said Mr Merriman was elected by shareholders to the board, AWI was applauded for its democratic processes in the EY review and this must be respected.

“Mr Merriman was voted onto the board by the shareholders of AWI in a most overwhelming sense and Mr Merriman will stand again for election in the 2019 director elections.

“And it will be up to the shareholders to decide whether they would like Mr Merriman to continue on as a director and continue on his most productive contributions and most selfless contributions to the company,” she said.

The EY recommendation for a 10-year director term cap has been listed to go to a shareholder vote at an extraordinary general meeting in mid-March next year and Ms Garnsey later said the prospect of Mr Merriman standing again would depend on the result of that resolution.

“Following this matter going to an EGM, if Wal chooses to stand again and the shareholders vote for him, yes.

“It’s a shareholder owned company, it’s democratic, it has been applauded for its democratic processes versus (those of) our other RDCs and anyone can stand,” she said.

“And indeed if he stands again, that is his choice and it will be the growers’ choice as to whether they appoint him to the board.

“Pending the outcome of the shareholders’ decisions at the EGM, that decision will be made by Wal – he will either have a pathway to that or not, as an outcome of that EGM,” Ms Garnsey said.

“He does have an intention to stand again, but of course he will have to observe, we will all have to observe the outcomes on this and other matters from the EGM.”

Mr McBride later said the 1.5pc WoolPoll result which went against Mr Merriman and AWI’s recommendation for a 2pc levy, summed up “the anguish of our industry.”

“He must go now,” he said.

Ms Garnsey initially refused to comment on whether AWI was risking executive action by Mr Littleproud and the government if all of the EY review recommendations were not implemented, including the 10-year cap. Mr Littleproud has maintained he wanted all the review’s recommendations implemented and that he had legislative and SFA options to ensure this happened.

“The minister is on record as saying he respects that it is a shareholder-owned company and he respects our Constitution and the shareholders’ ability to vote,” Ms Garnsey said.

Why was the EY review needed, asks NSW grower

During the AGM, NSW grower Tim Dowling asked why was the EY review needed. He said he “laughed out loud” when he heard Minister for Agriculture David Littleproud say the review was needed.

“This dysfunctional government telling you guys how to run a business – I mean, this is a joke, and will there be an extra cost of governance because of this at a time when you’ve had your budget cut, by, it looks like the West Australians?”

Ms Garnsey said the ROP was part of AWI’s Statutory Funding Agreement with the Federal Government. She said the review had a “heightened level” of review of performance, “simply around some matters that came up last year.”

Ms Garnsey failed to mention that Mr Merriman has recently been at the centre of several industry controversies concerning his behaviour and AWI governance over the past 18 months. These included Mr Merriman’s actions in covertly observing fellow breeders in a focus group behind a one-way mirror and swearing at an ABC reporter last year, and appearance at several Senate Estimates hearings. Mr Merriman also recently claimed AWI would become technically insolvent if growers voted for a 1.5pc levy in the 2018 WoolPoll and his chief executive officer Stuart McCullough partially blamed wool grower bodies for recent wool price falls.

“So we have to accept that we are where we are, government can choose to do that, they did that, they appointed Ernst and Young.

“Ernst and Young had fulsome access, complete access to the company and we were really heartened to see that there was actually so many compliments actually buried in there, particularly in relation to the governance of the company, the fiscal management, the prudent reserve management.”

Earlier in the meeting, Ms Garnsey said the EY review found “no fault with the existing governance” of AWI and later said EY found no breaches of governance according to the SFA or the Constitution.

“What EY did is find opportunities for us to lift our standard of governance and that’s really what the bulk of those recommendations are to do with, so that’s an opportunity for us.”

However, Mr McBride said the 82 review recommendations showed there was fundamental problems with the transparency and governance of AWI.

“So if Collette Garnsey does not realise that then maybe she should pass the baton to Meredith Sheil, who has the respect of many people within our industry.

“It was love fest for Wal.”

Mr Merriman turned down repeated attempts for comment on his intention to re-stand in 2019.

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Reader's Comments


Comment
  • David Everist November 23, 2018

    This story would have to be called clutching at straws. It is the writer who cites Mr Merriman’s so called problems as background information. That paddock has been tilled so many times it is blowing away. Also cited is the opinion of a Mr McBride who represents the Australian Wool Growers Association. Who? The thoughts of Luigi the taxi driver would have been more apt.

  • Andrew Farran November 23, 2018

    It seems that Wally left it to the new president to speak for him as to his future intentions, rather than speak for himself. Either way, the issue of the ten-year limit takes on added importance if Wally is insistent in standing again. Of course, it is a matter for shareholders if he does renominate, but the process would be less divisive and better for everyone, including Wally, if he were to let go and leave space for fresh talent.

  • DON LAWSON November 23, 2018

    Well said Tim Dowling. Farmers who pay a compulsory levy are better at running rural affairs than those in both government and or in the minister’s departments. Look at their disasters — the Murray Darling policies no-cost benefit study looking at the social outcomes until now, the failure to regulate live exports by the minister’s staff. But worst of all their failures; not to have a royal commission into the Johne’s Disease policy which destroyed so many many farm families. The AWI chair was the only farm leader to talk sense, yet Canberra had a royal commission into the failed pink batts disaster. Terry Sim needs to get off Wal Merriman’s back and have a good look at Bega Cheese, where the chairman has been there for 15 years. If the levy payers are unhappy, then let them stand democratically against Wally Merriman. It’s none of Canberra’s business. They have damaged the wool industry.

  • Virginia Hawker (Collins) November 23, 2018

    After watching the entire AWI 2018 annual general meeting webcast today, I wondered what Terry Sim would report in Sheep Central. I anticipated it would be similar to his previous anti-AWI, anti-Wal Merriman comments. Sadly, I was correct.
    True to form, instead of changing his repetitive, ignorant and damaging viewpoint and presenting a balanced observation of the meeting, again he has written a predictably negative piece instead of lauding the success of the enormous range of marketing and R&D projects AWI has initiated.
    There is an old saying that you can only be stabbed in the back if you are ahead of the pack. The distance between the contributions of Wal Merriman and his detractors is immeasurable, and they should consider they are only harming the interests of wool growers and the worldwide wool industry by continuing their public vendetta. Many customers are no doubt marvelling at such behaviour, and viewing it with concern. It will be a tragedy if ignorance kills the geese that lays golden eggs.

  • Ken Schultz November 25, 2018

    Since Wal Merriman joined the board of AWI wool consumption has plummeted. Coincidence? Wool production figures from http://www.wool.com.au and http://www.wool.com; 2004/2005 475mkg produced, 2018/2019 (forecast) 305mkg. Yes of course the price has gone up, we are producing nearly 36 percent less product and probably over 50pc less Merino wool than when he began on the board. Any fool could have achieved a similar result without spending millions in worthless promotions.

  • Jim McKenzie November 27, 2018

    Wal Merriman needs to stand aside and let new talent take on these roles. Yes, he has done a credible job as chair and as a board member before that, but 14 years is a long time and good governance would suggest that he has done his time. Let the industry remember him for what he has done, not for staying past what would be too-long. The wool industry is in a good space. All we need as growers is the season to go with us.

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