After being forced out as Qantas chair by a combination of Joe Aston, seething politicians, proxy advisers and institutional shareholders, Richard Goyder always faced an uphill challenge in requesting another three-year term as chair of Woodside Energy.
But the former long-serving Wesfarmers CEO, chairman of the AFL Commission and all-round nice guy is running the gauntlet at what is shaping up to be a highly contested Woodside hybrid AGM at Perth’s Crown Casino complex on April 24.
Knocking over an ASX20 chair at an AGM is never easy — in fact it has never happened — but US-based proxy adviser CGI Glass Lewis is giving it a go, recommending shareholders vote against Goyder’s reelection and triggering a wave of press coverage in its wake.
Woodside, The Australian Financial Review and The Australian have been rallying the troops for 64-year-old Goyder, pointing out arguments for reelection such as that normally aggressive institutional shareholder Allan Gray will be voting in favour.
ISS, the most powerful global proxy adviser, had a bet each way: its mainstream service backed Goyder, while its specialist sustainability subscription service recommended a vote against because Woodside is not seriously trying to achieve net zero by 2050.
The only locally owned proxy adviser, the industry funds–focused Ownership Matters, is backing Goyder, which suggests that he will succeed in reelection, though there will likely be a double-digit protest vote that could get into the 20s.
After its transformative multibillion-dollar deal in 2022 to buy BHP’s oil and gas business, largely in exchange for 914.77 million Woodside shares issued to BHP shareholders, there are now about 621,000 Woodside retail shareholders.
I’m one of the tallest and smallest with just nine shares, which I used to vote against Goyder’s reelection by proxy earlier this week.
Here are nine reasons why the other 620,999 retail holders should do the same:
# 1
In my view, the many elements of the Qantas debacle were big enough to warrant Goyder’s full exit from the ASX50 chair club, given he chaired the company for more than five years, including the COVID period when former CEO Alan Joyce was doing his worst work.
# 2
The man is a ditherer. He took too long to fire Alan Joyce at Qantas, too long to find Gillon McLachlan’s replacement as AFL CEO, and is moving at a snail’s pace at Woodside when it comes to coming up with a credible plan to get Woodside to net zero. This will inevitably rely heavily on abatement through purchasing carbon credits.
# 3
Goyder’s Woodside AGM transparency record is poor. After copping an online grilling at the 2020 AGM, he banned online questions in 2021 when many east-coast shareholders couldn’t get to Perth. Similarly, he took too long to offer shareholders a climate action plan vote, and when it finally happened in 2022, the company copped a huge 49% protest vote for doing too little. Goyder cynically withheld disclosure of the proxy position until the very end of that AGM and failed to follow up with another climate vote at last year’s meeting. At least shareholders are getting a second climate vote this year.
# 4
Going back to his executive days, there was a notoriously dilutive Wesfarmers capital raising in 2009 after he overpaid to acquire Coles leading into the global financial crisis. The raising involved a $900 million selective institutional placement at $14.25 and a three-for-seven non-renounceable entitlement offer at $13.50.
The company only planned for a 15% take-up of the $3 billion retail component, which fell $1.4 billion short with no compensation for non-participants, and applications by retail shareholders for additional shortfall shares were needlessly cut back by $100 million. With Wesfarmers shares closing at $67.58 on Wednesday, retail shareholders were collectively diluted out of more than $10 billion in value by this badly structured capital raising, taking into account the Coles Group demerger in late 2018.
Staying with his executive career, the Bunnings move into the UK was also a disaster that cost Wesfarmers shareholders almost $2 billion.
# 5
For years, the Australian Shareholders’ Association has been calling on ASX-listed companies to ban political donations, and the likes of BHP, Aristocrat, QBE, Rio Tinto, CBA and Woolworths all comply with this approach. But not Woodside under chair Richard Goyder. It contributed $97,550 in 2022-23 and has paid each of the major parties more than $500,000 during his time on the board.
Staying with excessive politicisation, it was also poor form to appoint former WA Labor treasurer Ben Wyatt to the Woodside board with indecent haste, less than six months after he retired from Parliament in early 2021. Wyatt was responsible for arguably under-taxing the WA hydrocarbons industry during his stint as treasurer, and this sort of revolving doors engagement between senior government officials and large government-reliant corporates just creates greater community cynicism.
Giving Anthony Albanese’s son Nathan a Chairman’s Lounge membership at Qantas was also poor form. (Crikey notes that there is no suggestion payments mentioned here were illegal or nefarious in any way.)
# 6
On the transparency and executive pay front, it was Goyder’s decision as AFL president to cancel the annual report salary disclosure of then CEO Gillon McLachlan. Why would you do that? He also overpaid when recruiting new Woodside CEO Meg O’Neill from Exxon Mobil, as she is getting nearly $7 million a year and already owns 432,621 ordinary shares worth $13 million.
# 7
From an environmental, social, and governance perspective, Goyder appears to have done sod all to disengage the AFL from the toxic gambling industry, twice supporting a contract renewal for Sportsbet and its predecessor companies as the “official gambling partner” of the AFL.
# 8
Goyder’s appointment to the Woodside board in 2017 was criticised for being too cosy at the time because he got the job from his then Wesfarmers chairman Michael Chaney, who spent an excessive 11 years as Woodside chair after retiring as — you guessed it — the long-serving CEO of Wesfarmers.
It was Chaney who pushed for Goyder to succeed him in that role too. And speaking of the Perth boys club, Goyder’s over-the-top praise of billionaire Kerry Stokes in the 2021 AFL annual report showed a lack of judgment. He wrote the following:
Kerry Stokes AC announced his retirement as executive chair of Seven Group Holdings in November 2021 after a peerless business career in this country and the Seven Network continues to provide world class coverage via free-to-air coverage of our AFLW and AFL competitions.
Why the eulogising when Stokes hadn’t retired as chair of Seven West Media, which is the entity the AFL contracts through? And with Seven’s reputation now in the trash can, and its shares wallowing at 19 cents, it’s just plain wrong to say his mate Stokes has no peer in Australian business.
# 9
Finally, there are Woodside’s poor share price performance and Goyder’s lack of skin in the game.
When he retired as Wesfarmers CEO in late 2017, Goyder’s exit notice disclosed a holding of 351,664 shares, which would be worth $23.76 million if still held today. In addition, he owned three tranches of incentives shares totalling 247,928, which if fully vested and retained today would be worth $16.75 million.
That’s almost $40 million worth of stock all up. Yet, during his six years as Woodside chair, Goyder has only managed to buy 26,163 shares, which were last night worth $784,105 with the stock wallowing at $29.97. It was at $31.38 on the day he was announced as chair-elect back in February 2017. The modest shareholding is dwarfed by the $4 million-plus in cash he’s been paid by Woodside shareholders, including $841,108 last year, which was well up on the $606,000 Chaney was paid in 2017, his final year as Woodside chair.
When you put it all together, there are just too many blots on the copybook. However, Goyder will survive because there is no obvious successor on the board and institutional shareholders don’t want to be blamed for leaving a major company leaderless. Plus, they certainly don’t want someone like former Howard government resources minister Ian Macfarlane appointed. His presence on the board is just another example of excessive politicisation at Woodside, a bit like the decision to make Tony Abbott’s sister Christine Forster the head of communications, signing off on all Woodside’s ASX announcements.
Should Goyder go? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
