Belting up on the Gunns cowboys

By Stephen Mayne
November 6, 2015

We gave Gunns plenty of stick at their AGM in Launceston on Thursday as you can see from this piece sent to Mayne Report subscribers early on Friday morning.

When the history of this Federal election is written, the cowboy antics of pulp mill proponent Gunns Ltd will surely rate more than a passing mention.

The pulp mill didn't really become a major election issue until businessman, Telstra director and former John Howard adviser Geoffrey Cousins launched his media and advertising blitz in August.

And what motivated Cousins? It was this remarkable anti-Gunns polemic by author Richard Flanagan in The Monthly, which first hit the streets in May. I read it for the first time on the plane to Launceston yesterday and it had a powerful effect - the Gunns relationship with Tasmanian Labor really is an institutionalised disgrace.

Flanagan's account filled me with rage, so I gave the Gunns board a complete bollocking at the AGM yesterday and waved the magazine at them, accusing them of gross incompetence which could be directly responsible for a great potential Liberal Prime Minister in Malcolm Turnbull losing his seat and the Greens gaining the balance of power in the Senate.

It was foolish tactics such as doing renovations to Premier Lennon's home and launching legal action against 20 company critics two days before unveiling the pulp mill proposal which gave the likes of Flanagan all the ammunition they needed to recruit serious mainland and media support.

Despite the media ban and attempts to prevent recording, you can listen to the full spray here.

The nuts and bolts of the meeting was covered in yesterday's 400-word report, but what transpired deserves to be picked over in some detail.

John Gay started by reading an 8 minute chairman's address which finished with a thanks to staff and the following line: "It is unfortunate that they have worked, and their families have lived, under harrassment and attack which should not occur in our society."

Indeed, John. So why did one of your besuited supporters allegedly threaten to kill one of the Green critics as he left yesterday's meeting after delivering a powerful anti-corruption speech.

Sure, the intractable forestry debate in Tasmania is the closest thing Australia has to the Middle East, but for mine Gunns is responsible for a majority of the conflict.

When Dick Pratt got his heavily subsidised pulp mill up in Tumut, he had the Australian Conservation Foundation on board as consultants.

The Gunns approach is to sue the world, monster critics and dominate Tasmania. The most staggering statistic revealed yesterday was that Gunns spends $11 million a year on its 5000 kilometres of private roads - which is more than the state government itself owns. That's incredible.

HOW THE DEBATE UNFOLDED

John Gay told the press that the AGM was stacked with Greenies, when in fact there were many more Gunns supporters in the room, they just didn't ask any decent questions, thereby leaving the floor to about 20 polite but determined anti-mill proxies and shareholders.

There were supposed to be five resolutions and Gay initially said general questions would be taken at the end. I was the only person who got up on the accounts, asking if the publicly claimed $1 million a day cost of delay since September 1 was true, given the annual report put a total cost of $50 million on the project so far. Mill executive Les Baker admitted this included the "opportunity cost" of delayed revenue.

On the remuneration report I was also a lone voice too, asking why Gay had a $676,364 loan from the company and why our newest director, Mr Millar, was flogging so many cars to Gunns. Gay has subsequently paid back the loan and there was no explanation on Mr Millar.

Chairman Gay then tried to group the three director elections as one resolution, even though they were listed as 3a, 3b and 3c. He didn't want any debate and certainly wasn't going to let the directors speak, but by this stage I'd asked for the proxies and they revealed quite a protest against both the remuneration report and the re-election of Dick Holyman.

I did my talk about the board being too entrenched and long serving and then Gay went straight to the poll without dealing with items 4 and 5, which were presumably coming at the end.

The staff then went around collecting all the ballot papers but I hung onto mine because the formal business wasn't finished. It was at this point that Gay prematurely opened up for general questions as if the formal business was over.

GENERAL BUSINESS

The one hour of general questions unfolded as follows and it was pretty quick stuff to fit in 23 different contributions over such a short space of time. If only Woolies had managed the same last Friday when we went for 3 hours and 20 minutes but only had about 15 different speakers.

1. Greenie in opening salvo.

2. Greenie on mill financials.

3. Harry Stackpool congratulated board.

4. Greenie on wood supply security.

5. Greenie on pulp mill permits.

6. "Tom" asked a dorothy dixer about whether $1 billion would indeed be added to the Tassie economy. John Gay: "Yes".

7. ABC reporter Felicity Ogilvie on the cost of Lennon's home renovations. Gay said it was "commercial in confidence".

8. Greenie on water pollution and emission audits. Gay hand-balled to a logging planner.

9. John Hayward on who owns the forests and potential challenges to road and port access. Gay gloated that "we win nearly everything that is put up".

10. Greenie quoting from a letter sent to shareholders accusing them of bludging off the taxpayer. Gay demanded to know "who wrote that letter?" There was much mirth at the reply: "John Citizen". It was at this point that one of the executives rolled out the 5000 kms of roads line.

11. Greenie on Launceston water quality risks from mill.

12. Company man Sam Trisson asked for confirmation that contractors pay taxes. Duh. These dorothy dixers were really bad.

13. Eugene Kneebone was the only real neutral when he asked that more be done to improve the landscaping at the mill site.

14. Dr John Ball - retired GP who asked for predictions in kilograms for pollution, sparking a response from Les Baker that the AMA have not come good with a detailed report to back up their anti-mill claims.

15. Dr Kathleen Petrovski - bagged chief scientist Jim Peacock as a nuclear power advocate, sparking Robyn Gray to claim we wouldn't need nuclear if we'd damned the Franklin-Gordon.

16. Greenie on market threats to mill viability.

17. Paul Oosting from Wilderness Society on whether ANZ would bank the project and whether the mill would completely replace woodchip exports. This was certainly implied but when asked for a specific undertaking, the company reserved its right to keep sending chips to Asia. Gay was very cocky on the ANZ support, but show-cased his unfortunately inarticulate ways by claiming it was "one issue that is the least of our minds" even though new ANZ CEO Mike Smith has made positive overtures to the Greens.

18. Greenie seeking further assurances on phasing out of woodchip exports.

19. Stephen Mayne spray at the board.

20. Bearded man lauded the courage of Lennon and Gay before declaring he was a "proud Gunns employee".

21. Gunns supporter demanded to know how many of the Greenies had seen a working pulp mill.

22. Phil Bollinger unleashed his strong speech against corruption.

23. Erica Ford, who once ran for the North Broken Hill board, on whether Gunns had done a cost-benefit analysis of the mill.

THE FINAL FIASCO

John Gay did give the Greens a reasonable go but he attempted to end questions three times, each time relenting to "just one more". Amid cries of "more questions" from the Greens, he then closed the meeting but his lack of a microphone meant the meeting descended into chaos. Gunns is a good case study for having the whole meeting miked and turning them on and off as required to control proceedings.

I had to literally scream that resolution five hadn't been dealt with and we were all starting to leave when Gay demanded order above the din to re-open the meeting. Gay has denied in the press that he consulted with a lawyer, but clearly his company secretary and fellow directors set him straight about the stuff-up.

Gay was hoping the re-opened meeting would only last another 30 seconds but I demanded the right to ask a question related to resolution 5: Why did Gunns do a recent placement of 15 million shares to institutions at $3.36 without offering us small shareholders a chance to buy in at the same price in a share purchase plan.

As someone whose livelihood depends on SPPs given the costs of running a 450-strong portfolio, putting pressure on companies that don't offer them is an important part of my advocacy.

Gay mumbled some lame excuse and then just closed the meeting.

HOW THE MEDIA COVERED IT

It really was a media smash and grab against Gunns in Launceston. The plane only landed at 9.30am but by 9.55am I was inside the Gunns compound and providing a 5 minute scene-setter to Tasmania's ABC statewide morning radio program, after sending them an email the night before.

The meeting finished at 11.50am which was perfect timing to provide another 5 minute summary to ABC statewide shortly before fill-in presenter Louise Saunders finished her shift.

Then it was a couple of minutes with AAP's Trevor Chappell which led to coverage such as this story on the Herald Sun website. The Wilderness Society's Sean Cadman then held a press conference for a 10-strong assembled press pack who were locked out of the meeting.

After he was done, I did the same and John Gay's incompetence featured prominently in the press briefing which you can listen to here.

Once this was done it was a quick walk over the bridge to The Sebel hotel, where I bought 30 minutes online, enjoyed an orange juice, pumped out a quick 400 words and then hopped a taxi for the 1.30pm flight home, after just four hours on the ground in the Apple Isle.

The line about Gunns aborting the meeting got a big run, even though I reckon it was inadvertent and John Gay simply stuffed things up. No wonder he was upset and had a go at me on Lateline Business last night, telling reporters: "What does the Gunns board think of Stephen Mayne? It would probably shock you too."

PM's coverage was easily the best of the media as reporter Felicity Ogilvie got herself into the meeting with a proxy and even asked a rather daring question about how much Premier John Lennon paid for the renovations Gunns did on his home.

Ogilvie picked up on Robin Gray's line that "if we had damned the Franklin Gordon we wouldn't need nuclear power" - which sparked calls of "leach ridden ditch" by the Greenies, who remembered Gray's famous line during that dispute.

Fast forward 24 years and history is about to repeat itself as a Tasmanian environmental issue play an important role in a Federal election campaign.