“I respect the regulator, and I sincerely hope that respect would come the other way as well,” he said. “And those who disrespect the regulator are fools.
“They have a job to do, they are representing the people like we are representing – our shareholders. They should be taken seriously, they should be allowed to work with you to the common cause of making things are done right,” Mr Gonski said.
“If you look back – and I’ve been around for a hundred years – most of the problems that occurred [were due to] the respect for working together [not] being there.”
He added that arrogance had no place in the modern board room. “Anybody who sits on a board who is arrogant or aloof is a fool.”
Amid raging debate about the size of executive pay packets, Mr Gonski also responded to Labor’s policy to make transparent how much higher a CEO’s salary was compared with the average wage earner.
It was easy enough to work it out via Google, he said, questioning the need for additional disclosure. He also warned that disclosure could be a precursor to hard caps – which he said would make it harder for Australian banks to compete for management talent.
“What I would be really against is if it was legislated, and there are some jurisdictions in the world relating to banking where they say it can’t be higher than a ratio – I don’t think we should do that.
“I believe people are entitled to have us accountable for remuneration, and debate remuneration, and shareholders can vote one way or the other, but it should be left to the companies on how to do it.”
Mr Gonski’s call for the Corporations Act to not be changed to incorporate broader duties comes after the ASX Corporate Governance Council last week dumped a “social licence to operate” after a furore over political correctness.
At the royal commission, NAB chairman Dr Henry called for directors’ duties to be expanded beyond shareholders to the whole “community”, saying their sole focus was the reason people no longer trusted business.
But Mr Maxsted rejected this, saying shareholders primacy was appropriate because they “are the ones who have their money most at risk”.
Commissioner Kenneth Hayne declined to recommend a legal change but, in a position consistent with Mr Gonski and Mr Maxsted, said the “longer the period of reference, the more likely it is that the interests of shareholders, customers, employees and all associated with any corporation will be seen as converging on the corporation’s continued long‑term financial advantage”.
“And long-term financial advantage will more likely follow if the entity conducts its business according to proper standards, treats its employees well and seeks to provide financial results to shareholders that, in the long run, are better than other investments of broadly similar risk,” Commissioner Hayne said.
from Trendy Newses https://ift.tt/2GY97iy
0 Comments