The half-baked effort by Qantas chairman Richard Goyder and the rest of the discredited airline’s board to allay public and shareholder anger by shaving a sliver off departed CEO Alan Joyce’s bonus demonstrates a group of directors in deep, deep denial.
Joyce’s pay has been docked just $500,000 from his short-term bonus to reflect customer fury, but the rest of it — $2.2 million — along with another $8.36 million long-term bonus, could still be handed to Joyce on top of the $23 million he’s walking out the door with.
To recap what Joyce achieved:
- trashed Qantas’ reputation through abysmal and unreliable service;
- illegally outsourced workers, exposing the company to massive compensation — and litigating ferociously to try to avoid facing up to its actions;
- allegedly sold tickets illegally to flights it knew would never fly;
- underpaid its workers by $7 million;
- hoarded airport slots far in excess of what it needed, with the goal of locking out competitors;
- profiteered and gouged Australian travellers, exploiting a de facto government-endorsed monopolist position in Australian aviation;
- sold off nearly all his Qantas shares while knowing the Australian Competition and Consumer Commission (ACCC) investigation into fake flights was under way.
In all this, Joyce was enthusiastically supported by the Qantas board.
Qantas is one of the highest-profile, and most important, companies in the country, but its board is a clutch of second-raters who sat back and did nothing while Joyce turned what was once an iconic and loved company into one of Australia’s most hated. (Most hilariously of all, the board includes alleged marketing guru Todd Sampson, who has been a member while probably the biggest destruction of brand value in Australian corporate history has taken place.)
That Goyder and co decided to engage in what was essentially theatre in inflicting a trivial reduction in Joyce’s pay and holding the rest of his bonus in abeyance until a more convenient time, shows that they don’t get it. Why would they? They didn’t get it when Qantas was running a service that became a national joke, nor when the airline kept losing the legal actions brought by the victims of its outsourcing campaign; they didn’t get it when Qantas became the most complained-about company in the country; and they didn’t get it when the ACCC came knocking with serious allegations.
They didn’t get it, don’t get it, because they don’t need to. They’re essentially a monopoly operating an essential service. No matter how hated Qantas is, no matter how ineptly the company is run, no matter how appalling the service is, no matter how much the one-time national carrier is turned into Aeroflot, travellers still have to use it.
Compare and contrast the big banks: they’re oligopolists, but they’re much more heavily regulated as systemically important parts of the economy, and they face at least some competition from each other and from smaller and regional banks (which is why ANZ is trying to snuff out a competitor in Suncorp’s banking arm).
When the banking royal commission and AUSTRAC exposed their contempt for their own customers, their gouging and profiteering, and their flagrant breaches of money-laundering laws, the Westpac CEO and chair both quit, NAB’s CEO and chair both quit, ANZ sacked more than 200 staff, and the CBA CEO resigned.
Others fared even worse: AMP, one of the oldest and most respected names in the Australian economy (and not just finance), saw billions in losses and dud managers in the first two decades of this century. Then it was exposed by the banking royal commission, not to mention management scandals, so out went the fourth CEO and fourth lot of board members this century, forcing the company to split itself and sell off assets to survive.
Qantas’ misconduct is at least as bad — it may not have charged fees to dead people like AMP, but it flogged tickets to flights it knew would never leave the ground, gouged customers and sacked workers illegally. Literally no-one has paid any price for that, given Joyce merely brought his retirement forward by a few weeks.
But Qantas faces no threat of competition — not while the Albanese government is looking after its interests and a benign regulatory environment in which there is no independent complaints-handling body, no price monitoring and no check on its profiteering.
Why would Goyder and the nonentities who populate the Qantas board change their ways? The CEO might have changed at Qantas, but the board and the airline won’t, because they don’t have to.
