Crown Resorts shareholders should oust three board directors at the company’s forthcoming annual general meeting next week in light of revelations that have emerged from a licensing suitability inquiry in New South Wales.
Three Crown Resorts directors, including James Packer loyalist Guy Jalland (pictured) face reelection at the company’s AGM next Thursday. (Image: The Australian)That’s according to the Australian Council of Superannuation Investors (ACSI), an organization that advises the nation’s largest pension funds.
ACSI believes the fact that a public inquiry is necessary at all is evidence of poor governance and that a shakeup is necessary.
The advisory firm is calling on shareholders to vote against the reelection of Jane Halton, John Horvath, and Guy Jalland to send a clear message to the boardroom.
Change NeededThe ongoing inquiry is examining whether the company has turned a blind eye to criminal elements in the junket industry with which it partnered as part of its international VIP program. It is also investigating whether Crown allowed itself to become a conduit for money laundering in its eagerness to attract VIP players from China.
At stake is its license to operate a $2 billion casino on Sydney waterfront, which has been years in the making and is expected to open, finally, at the end of this year.
Investors will be looking for director accountability for their oversight of governance failures identified during the NSW casino inquiry, ACSI chief executive Louise Davidson said. These include the board-approved private briefing of shareholders, oversight of anti-money laundering process, and the ‘ill-advised’ public response to concerns over Crown’s practices.
“Beyond the three directors seeking re-election, what we have heard in the inquiry reflects poorly on the board as a whole,” Davidson said. “A number of long-serving directors should be considering their position in light of what has emerged.”
How Will Packer Vote?Davidson was especially critical of the secret board-approved process that existed to provide daily financial reporting to Packer’s investment vehicle, CPH, despite the billionaire having left the board – a revelation uncovered by the inquiry. Since Packer was no longer a board member at the time, it has been suggested this is tantamount to dealing with insider information.
Much of the fate of the three board members up for reelection depends on how Packer is chosen to cast his vote or whether he chooses to vote at all. Packer is a 36 percent shareholder in the company.
Under normal circumstances, Halland could expect the billionaire’s backing. But while testifying to the inquiry last week, a penitent Packer acknowledged there had been failings of governance at Crown and that the board might have to change for the company to retain its Sydney license.
Halland is a Packer nominee and the head of CPH.
