Forum Archive Index - September 2001

["geoff_julie" <gk_jawalker@paradise.net.nz>]

Investors should not forget that Air NZ is not the only company that has had shareholder equity destroyed by those appointed to protect it - Management and the Directors.  Shareholders have no say in the running or decisions a company makes during the year.  The opportunity once a year to question the decision makers in an annual general meeting usually turns into a sham.  How many company meetings are simply a publicity stunt with a cup of tea and biscuits thrown in to appease potentially rebellious shareholders.  When have shareholders ever been able to influence a board or overturn a decision made?  I can't think of many instances over the last few years. 

 

Until shareholders, like our counterparts in the US and Australia, can influence and change decisions we are stuck with the status quo.  The status quo in NZ often equals poor performance year after year.  Think of THL, Carter Holt, Fletcher Forests (there are many, many other companies).  How many years have they come out and blamed; the government, the weather, cyclical markets, GST, exchange rate, the Holmes Show, Olympics,the list goes on and on for poor returns.  The excuses sound plausible after a year or two but the same excuses every year, come off it!

 

I believe that until we see the big insurance and fund managers finally show some backbone and demand results, be that by tossing out those directors who aren't performing (wouldn't be many directors left at the rate some of our companies are performing...) nothing will change.  As the old saying goes "you reap what you sow".

 

I hope I live long enough (I'm 35) to see some honour, professionalism and consistently high performances by both Directors and Managers of our companies.  If they perform, profits will increase, shareprices will increase, companies will grow.  I'm not holding my breathe.....

 

Geoff