As the ‘man-in-the-mirror’ scandal grips the Australian wool industry, the country’s peak lobby group says they believe the head of Australian Wool Innovation (AWI) may have breached the Corporations Act.
It’s been revealed AWI chair Wal Merriman watched a focus group, which growers did not want him to attend, from behind a one-way mirror without their consent.
Wool Producers Australia CEO Jo Hall said it was unacceptable behaviour.
“This recent incident raises a number of significant questions regarding the conduct, ethics and governance of the wool industry research and development corporation,” she said.
“We certainly don’t believe that it’s appropriate conduct for any chairman of a board to be watching a confidential focus group unannounced.
Questions about culture at Australian Wool Innovation
Ms Hall said Wool Producers Australia had been vocal in the past regarding the current wool industry structure.
She said this recent incident involving Wal Merriman should prompt a review.
“We’ve been long advocating the need for an arm’s-length industry oversight of AWI in the interest of all wool growers,” she said.
“As the wool industry’s services body responsible for the expenditure of a compulsory levy, there is a requirement that AWI’s governance and conduct is nothing short of transparent and accountable, which we don’t believe is currently happening.
“There’s been a number of issues around AWI’s performance and one recent one this year has been the staff redundancies that were just exposed in the senate estimates in February.
“They were far above the legal requirements for a redundancy and at the end of the day this is wool growers’ money we’re talking about.”
Farmer wants more transparency from AWI
South Australian stud breeder, Andrew Michael from Leahcim Merinos in Snowtown, said he was still lost for words over the chairman’s actions.
He said, in his eyes, the lack of transparency had made the whole process lose credibility.
“With the chairman there, who runs his own merino stud and has been very much against the movement into technologies, to sit behind that mirrored screen, I would make a comparison of McDonalds sitting in their board meeting and you’ve got hungry jacks sitting on the other side without notification,” he said.
Mr Michael said the chair of AWI should be independent and representing levy payers without a commercial conflict of interest.
“There’s just a number of issues for too long now that have happened; personally I think the chairman of a corporate board like that needs to be an independent person,” he said.
“I think there’s been so many decisions of funding cuts in areas that shouldn’t have been cut.
“We’ve got so much to offer in the wool industry throughout the world and yet we’ve got a component in there that’s actually trying to pull back and not use the technologies that every other rural industry uses.”
Mr Michael said he agreed a change of management and restructure of the AWI was needed.
“Everyone who pays levy money needs to be quite vocal about this, to make sure something like this never happens again,” he said.
“Maybe a change of management within that corporate governance of AWI, so we that we have a chairman who is independent and has no conflict of interest.
“And then we go through that board, [ensure] that those people are diverse in their understanding of how boards work.
“Otherwise if we don’t have that and people don’t have the confidence to go and do those focus groups, it will be a slowing up of net gain and profit for the levy payers.”
However, Ms Hall said having an industry-owned body such as AWI reviewed would not make for an easy process for change.
“AWI is an industry-owned organisation and therefore growers really need to get active if they’re not happy with the performance of AWI and make their views known,” she said.
“There are constitution requirements of AWI and that’s the agreement between growers and AWI but there’s also the statutory funding agreement between AWI and the Commonwealth.
“That obviously therefore means that there would need to be government intervention to bring about change.”
ABC Rural has contacted Australian Wool Innovation for comment.