RECENT public infighting among CBH directors was a focal point of questioning at last week’s Senate inquiry hearing into grain logistics.
Western Australian Pastoralists and Graziers Association (PGA) grains committee chair John Snooke told the Committee concerns about the CBH board’s “public factional war” were escalating in WA.
“We are now constantly seeing a factional war playing out on the board and it is spilling over into the media,” he said.
“Just recently I have had numerous members call me who are very, very upset by this public factional war that is being played out.
“They are looking at their balance sheets, which are struggling, and they see this equity in CBH that they cannot realise.
“But the value of CBH at the moment would be in some decline.
“Without going into the nitty-gritty of each issue, that tells you of the broader frustration that is really developing in WA.”
PGA wants CBH privatised
Mr Snooke said the PGA wanted to see a board that operated commercially, “like other companies in Australia”.
He said the PGA questions the way CBH is being managed and operated but “our members still identify that they have equity in the company”.
“Firstly, we would want to see CBH privatised so that it is operating by profit and loss, and not by legacy loyalty,” he said.
“That is where our members are getting very concerned. When we look back at the CBH board of the early 2000s, they were trying desperately to prepare the company for the changes that would inevitably occur in the industry.
“Our members are having problems when they do not see those changes. We are not seeing any rationalisation. We are not seeing CBH wanting to earn its business.
“It wants to retain its legacy loyalty by way of business rules.
“It is those things that are frustrating our members.”
WA Greens Senator Rachel Siewert moved to clarify the board room scenario during her questioning of various witnesses, including ascertaining whether the infighting was due to differences of opinion over the co-op or corporate structure.
Mr Snooke said he did not believe that was the issue – which CBH chief executive officer Dr Andy Crane agreed with. “I do not think that at a board level that issue is being debated at all,” Mr Snooke said, noting that the current “ructions” on the CBH board were playing into a current climate of uncertainty in WA.
“Everyone is talking about it,” he said.
Dr Crane told the federal Senators, “You live in a political world, so I think you would fully understand”. He said the board situation resulted from “the machinations of a normal co-operative member based organisation”.
“We have nine grower directors elected to our board,” he said.
“We have 12 directors, and three are non-grower directors who bring external experience as well.
“Strong robust debates, I think, are healthy. It is often perceived as a downside of the co-operative, but I actually think it is a strength because what it is saying is that members are working out what they really want the business to do for them.
"Sometimes that spills out of the boardroom, but I do not see a negative in it and it is certainly nothing to do with - and I agree with John Snooke - a co-op corporate debate.
“Our board is very unified that the cooperative model is delivering the best for our growers.
“So this is just more passionate debate about what is right in a whole range of issues.”