QANTAS: AGM didn’t go well for Qantas. Shareholders say f**koff to remuneration report
I’m in avgeek nirvana at the moment, flying back from New York to Sydney, sitting in a nicely configured business class on a Dreamliner 787, and watching live updates of the Qantas Board Meeting being held today in Melbourne via inflight wifi.
If I were on land, I would watch the video coverage live and plan blog posts as it progressed. Unfortunately, up here in the air, the Panasonic-provided wifi is just not up to streaming the meeting to my laptop. Or maybe it’s the VPN I’m using. It doesn’t matter. I have to rely on other reports of the meeting instead of experiencing the stream directly. Or better still, being in that Melbourne Convention Centre for the meeting.
Content of this Post:
Are you as sick of Qantas’ apologies as I am? There is a point, and I think we are already well past it, where repeated apologies just sound ever more insincere.
That’s how much Qantas service has declined under Alan Joyce.
Then there are the already judged illegal acts of sacking ground handlers. On the horizon are the possibly negligent or even deliberate acts of selling already cancelled flights to unsuspecting passengers during COVID.
On the former, all we get is the CEO promising to deal with the negotiations swiftly. No one wants to talk about the hundreds of millions an adverse ACCC finding might mean for shareholders if Qantas is convicted of selling fares for cancelled flights.
All Qantas can offer in its defence at the moment is: they don’t really sell flights, just the right to catch one sometime (yes, really, that’s what their defence says). If that’s so, why does it cost so much to change a flight, sorry ‘rights’ from one flight to another flight if your plans change?
And managing an airline is really hard and complex, and our technology is shit! Any passenger could have told them that!
What was not allowed to be answered
The current chairman Richard Goyder, wasn’t permitting any question from the floor that doubted the ethics of the board. You know – their ethics in approving the CEO’s sale of his shares at record highs while they knew that the ACCC announcement later could bring the share price down, or when the company acted illegally to sack 1,700 ground handlers, but somehow board and executives are apparently blameless. Their defence runs something like: ‘We didn’t know it was illegal’. This begs the question, shouldn’t you have found out before you did it?
Who’s in and who’s out on the board
This is the slightly good news. The new CEO, Vanessa Hudson, was elected to the board overwhelmingly on 99% of votes, as were Doug Parker, Dr Heather Smith, and Belinda Hutchinson. So was Todd Sampson, advertising wunderkind, but with a big backhander, with 34% of shareholders voting against his re-appointment. Remember – he is the branding guru who apparently has sat by and watched the reputation of Qantas be destroyed.
Executives get a kick in the hip pocket
Think all that is bad? But wait, there’s more. At this AGM, 80% of shareholders just voted to reject the board’s remuneration report. Let me tell you how bad that is. According to current corporation law in Australia, if you have two consecutive AGM votes where only 25% or more of shareholders vote against a remuneration report then, all of the board is up for election. Meaning there could be a spill of the whole board.
This is bad. Really bad for the Qantas Board and for executives. To quote the Sydney Morning Herald:
‘This is the first time Qantas has received a remuneration strike and is one of the biggest strikes ever recorded in corporate history.’SMH
Shareholders, and I’m not talking just mums and dads, I’m talking big corporates and superannuation funds really hate it when people get an extra reward for when they aren’t actually adequately performing the basics of their assigned task. As they should. Personally, I’m against most bonus schemes. As has been an accusation at Qantas, they drive execs to run the company to meet their bonus release clauses rather than for the good of the company. But that’s a whole other story, one that Richard Goyder, the current chair, definitely doesn’t want to have aired in public at any AGM he is in charge of.
OK, Qantas, there is no ambiguity here. Your shareholders really do hate you. They have definitely heard the views of many of your customers. In fact, Qantas, your own research shows it. Your reputation is plummeting, and your competitors are the benefactors. But you are still tone-deaf. You still raise fares, claiming you can’t absorb more oil price increases. Your availability of reward fares using frequent flyer points is still appalling, especially in premium cabins. Your Business Class food stinks. Actually, your Economy Class food stinks too, Your food and beverage, service and quality levels are a mere shadow of their former selves.
Here is my theory for what it is worth.
Alan Joyce whether to benefit himself through bonuses or not, was the driver of ‘efficiencies’. That’s the executives’ colloquial term for cuts down to the bone in every area. Cuts to the point where notions of quality and a ‘full-service’ airline were hanging by a thread. It may have been able to sustain those cuts for a while, as customers gradually drifted away to competitors.
But then you had COVID.
No one is saying that wasn’t tough for airlines, It was very tough worldwide. Some airlines didn’t survive. But you, with all your highly bonused executives, you know, those executives that deserve to get a shit-load because of their fantastic abilities, fell into the trap of virtually every other airline. They used the pandemic as manna from heaven to ‘streamline’ labour practices, illegally sacking 1,700 ground handlers along the way. Then those executives and their board overlords promised too much and delivered far too little when lockdowns were ended and international flying returned.
Why do you overpay Executives when they fuck up?
All those overpaid exec poppets just couldn’t put Qantas back together again. They had pissed off their ex-staff so much that not enough wanted to return to work. Remember the glamour of working in the airline industry? Not so much when you are dealing with plenty of pissed-off customers. So, short-staffed, or subject to the deficiencies of staff you relied on but no longer employed, you cancelled flights or delivered passengers to destinations without their luggage.
But, but it’s complicated!
Now, you say that the airline industry is terribly complicated. We all thought that was why the execs and board got paid the big bucks. But apparently, it’s even too complicated for them. So you had to sell cancelled flights to people because it was too complex to do anything else. Oh yes, and by the way, Qantas doesn’t sell seats on particular planes flying at particular times to particular destinations. It only sells ‘rights’ to those seats.
Bullshit to all of it, Qantas.
Person up, take responsibility, and bloody do something about it. Oh yes, and Virginia/Virgil, AU$80 million ain’t enough to fix it. That won’t even cover the advertising budget, let alone some actual reform and improvements.
Apologies ain’t even the start!