Terry McCrann backs our 1998 campaign

Something rather unusual - indeed, genuinely unique has been happening in and to corporate Australia as it proceeds through the annual general meeting season. Stephen Mayne, the business editor of Sydney's Daily Telegraph newspaper, has been turning up at annual meetings in Melbourne and Sydney to quiz boards of directors.

Occasionally a proxy has operated on his behalf -which led to a rather amusing exchange at the meeting of the Packer family's listed Publishing & Broadcasting in Sydney last month.

The Daily Telegraph's Charles Miranda stood up to announce he was there as proxy-holder for Mayne who was at a meeting in Melbourne; and, according to Miranda, looking at racehorses.

This prompted an interjection from the company's recently retired, but hardly retiring, former chairman Kerry Packer: "He's got his priorities right, hasn't he." And after Miranda had directed a series of questions to PBL's current chairman, James Packer, Kerry let rip again.

"Let me ask you a question" -to Miranda -``As a matter of interest, do you check into Rupert Murdoch's personal holding or do they all have to go through News Corporation?"

Which elicited the response: "I'm just a police reporter," a ripple of spontaneous laughter from shareholders, and a further sally from Kerry.
Now business reporters quizzing company directors is not exactly unusual. What is very unusual is the process and context -and the subject matter -of the Mayne interrogations.

For he has been doing it as a shareholder. Albeit also writing about the exercise as a reporter. Which by the bye, has caused some interesting responses from competing newspapers -which, titillating exchanges with Kerry aside, haven't quite known how to report either the exchanges or the information uncovered.

For instance, on the same day that the Australian Financial Review reported the MirandaPacker exchange in detail, it also had a front page story detailing that the Commonwealth Bank had "revealed" problems with its big-ticket lending to Sydney's Star City casino. The information surfaced at CBA's meeting in Melbourne.

The AFR story said the bank's relationship with the casino was raised at the meeting by a "share holder". The AFR did not say that the "share holder" was in fact Mayne, whose presence in Melbourne made for the amusing tale from the PBL meeting in Sydney.

Now it is important to explain two key points about this exercise by Mayne. He has spent more than $140,000 of his own money to buy something more than token holdings in about 50 companies, mostly headquartered in Melbourne and Sydney. This is to give him standing in a formal sense at an annual general meeting as a legitimate shareholder. And standing substantively different to the buyone-share type of activism favored by anti-uranium protesters for example.

That's the second key point. He does not go to meetings to disrupt them or indeed even to embarrass directors. But to ask them legitimate questions as a legitimate shareholder, in the interests of all shareholders.

Now obviously there is a "media spin" to this. He is doing it as part of as journalistic exercise: he writes about the experience. But he does so from a legitimate shareholder perspective, and the focus of his questions is to extract information that is germane to shareholders.

The response from other small -shareholders - has been significant and positive. From: I'm glad you asked those questions -I'm always too nervous or afraid -to please come to these other meetings.

To the best of my knowledge, this sort of journalistic activism has never happened to Australian companies before; and some might see it as crossing an invisible line between journalists as observers and reporters and journalists as actors. In my view that is nonsense.

Journalists right across the spectrum have long since ceased to be mere spectators, conduits of information, or mirrors to society. The response from company chairmen has been interesting and varied. Most have seen it as a legitimate exercise, some individuals have even received it enthusiastically. The particularly enlightened would see it not simply as another step to bringing companies towards appropriately greater disclosure, but also a means to build much better contact with their own shareholders.

Taken further, that would suggest companies commissioning Mayne - obviously, in practice, someone like Mayne - to analyse them and to ask informed and unscripted and uncontrolled questions.

If nothing else, companies should now understand the line has been crossed, and they can expect ever-increasing activism from journalists-as shareholders.

This brings us to the bigger question: why hasn't this sort of informed, penetrating questioning happened at annual meetings before? By whom, you might ask? The big institutional investors, is the absent-in-action answer.

Most questions at most annual meetings are anodyne to asinine: the why don't we get biscuits with morning tea anymore variety.

The one exception is the Australian Shareholders Association. Although mostly, the ASA only swings into action where there's "an issue". What's been different about Mayne's exercise is that flows from normal analysis of the company's performance and activities.

It also utterly damns the institutions which should have been asking these sorts of questions for years if not decades. They have the skills and far more resources than an individual journalist. Plus a much tighter focus and much bigger interests in individual companies. They could have -should have -been firing in the questions on their own - and other shareholders - behalf. In many cases they have sat mute or voted with their feet.

Or worse, relied on privileged special access to boards and managements. Rock the boat at an annual meeting? Heaven forbid. Mayne has fundamentally exposed and I hope embarrassed institutional corporate Australia. Maybe the questioning should now turn to the institutions; to call them to account for past sins.

Copyright © 2022 The Mayne Report. All rights reserved

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