A very brief update this week as we keep waiting for the s.202B full disclosure statement from the board to all members.
1. We are still waiting
Just a few things to keep in mind as we wait
a. The board were forced to do what they should always have done.
The CPA Board have been forced by the members to make this full disclosure of the directors remuneration for the 2016 year because of their refusal to do so willingly and openly.
This is exactly why s.202B is in the Corporations Act.
It is there to ensure the directors cannot just adopt a one finger salute to members but rather have to be open and transparent with them.
The board of directors are there to oversee CPA Australia on behalf of the members. They have a fiduciary duty to the members and to the organisation.
Their refusal would indicate that they have something to hide.
Why would a membership organisation not openly provide full disclosure?
Think about that a bit when you hear the sales talk of Graeme Wade and Alex Malley and Jeff Hughes saying they comply with the minimum requirements of the law.
As to the stance of Tyrone Carlin as President/Chairman I just find his leadership woeful in dealing with this.
His comments at the AGM on lack of full disclosure came across as just weasel words to avoid the issue.
b. Why the delay?
The 2016 financial accounts were fully audited by Deloitte which included Note 18 which provides the remuneration paid to the board.
For this we have already paid the auditor almost $300,000 ($295,965 on page 90 of annual report).
Why the delay in confirming that amount now, and what extra work is involved if this was already fully audited fully.
All I can surmise is that the CPA leadership (board and senior management) are reluctant to provide this full disclosure because it will confirm a number of things that they know are very troubling.
It will reveal the total remuneration of the three senior executives (A Malley, A Awty, J Hughes) which we understand to be over 4 million of which the CEO A Malley’s share is closer to $3 million than $2 million.
It will reveal the remuneration paid to the President, 2 Deputy Presidents and the individual directors.
Can I encourage all members to read the sections in the two recent emails/memos to the members on remuneration (2nd March, and 16th March 2017) to give you some perspective on how they see these exorbitant remuneration levels.
No sense of remorse or possible hint that they are excessive to be seen in their statements.
But these were made before we forced their hand.
I personally believe they had become so disdainful of the membership given out past apathy and disinterest that they felt they could set remuneration levels that really are scandalous without any opposition.
Especially for the CEO Alex Malley. The board need to have their 'heads read' over the levels they have approved.
Yet they continue to remain silent and delay releasing what they need to by law.
I regard each of the directors individually as very weak and complicit because of this.
I am sure Solomon Lew at Just Group (Martin Hourigan), and Ian Narev at the CBA (Jennifer Lang), and Michael Spence/Belinda Hutchinson at Sydney University (Tyrone Carlin), and the L M Ericsson leadership (David Spong), and fellow partners of PwC Singapore (Deborah Ong), and the Aust Chamber of Commerce (HK and Macau) as well as Macquarie University (Richard Petty) would all be interested in these proceedings. And we shall be informing them once this s202B statement is revealed.
c. It will only be sent to the voting members
How pathetic can the CPA leadership be.
Adam Awty and the board were very clear on this when they responded to the request. I have copied the correspondence at the end of the email.
They brag about a membership of 160,000 (we now know to be only 155,000) of who we estimate (because they have not told us since 2010) about 40% to 45% are associates (cannot vote).
So that leaves about 87,000 full members.
They love to take credit for the 155,000 members but do not see them as worthy of full disclosure of inconvenient truths.
I find this all quite bizarre that here we are as members of our own organisation having to guess things which should be openly disclosed but aren't because the CPA leadership refuse to.
d. Regarding the 100 signatories to the s2020B request
If any members who signed the s.202B request have been phoned by Graeme wade or Jeff Hughes since can you please let me know as this information was confidential to the Company Secretary and if the current leadership are going to use that to do a sales job on them I think we need to know.
I call that part of the way they intimidate and bully members.
2. Directors serving well beyond the terms they told us about
Can I refer members to our website where in the cases of Richard Petty and Graeme Wade this has been clearly shown.
You can do the calculations yourself.
Richard Petty started as director on 1/4/2006 and Graeme Wade on 23/5/2006
We have been told in memos, and even in the explanatory memorandum to the constitutional change which extended their terms that ‘up to 11 years’ was the maximum.
Well Petty and Wade are both currently in their 12th years, and it would seem Wade may well be going froward into a 13th year next year.
3. Two things members can and should do
Keep in mind that the vast majority of members know nothing about all these issues and what is going on at CPA Australia.
That is why they have disabled and removed all possible communication links for members from the website like Find A CPA.
It’s absolutely bizarre and how the likes of David Spong, and Sharon Portelli, and Jennifer Lang, and Martin Hourigan, and Deborah Ong, and Jim Dickson given all their positions and experience could ever approve these actions defies me.
So let me make two suggestions
a. Send the links to the ABC report on CPA Australia, and the Parody on Alex Malley to as many members (and non-members) as possible., and the link to the website
They summarise well the issues, and provides an easy overview of the issues.
http://www.abc.net.au/news/programs/the ... nd/8528818
b. Communicate with as many people as possible with all the above items mentioned or your own summary.
One’s I suggest are
- those mentioned as speakers at CPA events such as the Leaders Forum, or Congresses etc.,
any people mentioned in the The Black magazine
with leaders in the corporate world (CFO’s, CEO’s, directors etc)
your local member of parliament as well as regulatory bodies such as ASIC
all the accounting departments and business schools at the universities as well as the Vice Chancellors and Chancellors
the media on all platforms
the employers of the directors
They seem to have adopted the political approach of "lets just keep our heads down and let this blow over mentality”.
No guesses from where they have learned that approach.
We need to get the word out.
These are no small matters but it will require more members to become actively involved in communicating this to the members.
This remuneration scandal especially needs to be called what it is and these directors need to be called to account for it.
4. We need to grow the email list of members
Again we need to be realistic here. If tis gets into a proxy fight then we need as many members email addresses as possible.
Brett Stevenson CPA BComm MDiv
Begin forwarded message:
From: Adam Awty <Adam.Awty@cpaaustralia.com.au>
Subject: RE: Request for Fun Disclosure of Director Remuneration of CPA Australia as per s.202B of Corporations Act
Date: 4 May 2017 at 1:00:14 pm AEST
To: 'Brett Stevenson' <firstname.lastname@example.org>
Dear Mr Stevenson
Thank you for your email.
Apologies for the delay I have been away from the office this week due to illness.
We are currently in the process of preparing a Statement of remuneration of each Director in accordance with Section 202B of the Corporations Act for the last financial year.
Once collated the Statement will be provided to our auditors so that they can audit it. Once they have completed their audit, the company will send a copy of the audited Statement to each person entitled to receive a notice of the Annual General Meeting.
From: Brett Stevenson [mailto:email@example.com]
Sent: Friday, 28 April 2017 9:39 PM
To: Adam Awty
Subject: Request for Fun Disclosure of Director Remuneration of CPA Australia as per s.202B of Corporations Act
Dear Mr Awty,
Please find attached a request for a statement disclosing the remuneration paid to each of the directors of CPA Australia and its subsidiaries as per s.202B of the Corporations Act 2001.
The request is signed by over 100 CPA members.
I have attached it as a zip file, and presume you will treat the names of the members and this request with utmost confidentiality.
I shall also send a copy of this request without the zip file to the board, Tyrone Carlin as President, the CEO and COO of CPA Australia, to other CPA members and other interested persons.
I personally think it is a pity that as a CPA member I need to make this request of my own organisation because of the lack of full disclosure by the board in the first place in our annual report.
We should have no fear of being open and transparent about our financial reporting as a membership organisation, and it is disappointing that the board have continued to adopt a regime of minimum but compliant disclosure, especially on this issue of remuneration.
I would encourage you to also provide full disclosure on the remaining Key Management Personnel because failure to do so just repeats the failure above.
You would appreciate that listed public companies are required to do this and why we fail to at least match them sets a poor example to not only the members but also to the watching world to whom we profess the highest of standards. It is somewhat perplexing to me that as a board you profess and feign high standards (and even go so far as to advertise as in the recent In The Black for directors with senior level experience in listed companies, large accounting firms, international business and regulatory bodies who would be used to such full disclosure requirements) yet exhibit the opposite. We are professing high street standards but are really behaving like the owners of the local corner store (if you catch the drift).
I would go so far as to suggest that the 100 plus members who have signed this request are exhibiting and encouraging the high level of professional standards we as an organisation need to exemplify.
Full disclosure, openness, transparency are the words that come to my mind, and as annoyed as you might be for me to say them, I think until you start to exhibit them more in your communications with the members on these very common 'hot issues' such as remuneration to key management personnel you will continue to display the leadership that brings derision to our profession, our organisation and we the members.
And I am not alone in thinking that. These 100 signatures were gained within 4 days from members who feel as concerned as I.
I shall not begin to express my anger and disappointment at your removing the email addresses of members from the Members Register you sent through, and which we members paid $2351 to access.
You know as well as I, and all the members, that the main communication method with members is via their email addresses which is on the Members Register.
But you refuse to disclose that to us.
We will hold you legally accountable for that Adam as Company Secretary and I am writing to ASIC to investigate whether you have breached the provisions of the Corporations Act, which my legal advice says you have.
Of course there is still time for you to redress this breach by sending through the email addresses of members but I shall leave that in your court.
Given that the annual report and financial accounts have been prepared and audited for the 2016 year I don’t believe this should take a long time to prepare.
As you will no doubt be aware this needs to be audited and sent to every member of CPA Australia.
I look forward to your prompt response.
Brett Stevenson CPA BComm MDiv