Franks To Stand For Air New Zealand Board
ACT MP Stephen Franks has confirmed that he will stand for the Board of directors of Air New Zealand to ensure there is a contested election at the Annual Meeting on October 30.
"I'll be honest. I don't expect to be elected. The major shareholders BIL and Singapore Airlines will make sure that doesn't happen. The smaller shareholders are at their mercy.
"But regardless of that, shareholders should have the opportunity to show their opinion of the stewardship that has led to the humiliation of the national flag carrier. There has to be a challenge to, and some change in, a board that has presided over such a catastrophic destruction of shareholder value.
"My nomination went in last week because Air New Zealand has a two month deadline for nominations. I am standing to ensure that shareholders can show they do not meekly acquiesce to non-performance.
"I hoped more eminent New Zealand business people would stand. I wanted to hear a commitment to growing the airline as a vibrant competitor within the Star Alliance. This should be under substantial New Zealand ownership and under the effective control of New Zealanders, as the constitution and the government's Kiwi Share are supposed to require.
"What went wrong? Shareholders and taxpayers need a much better explanation than 'unexpectedly high fuel costs' before entrusting more investment to this board. Or were the decisions being made by the dominant shareholders?
"Must those in control of the company admit to a disastrous mistake? Must we dump Ansett for whatever it might fetch? We need to know the answers before New Zealand throws good money after bad serving the Australian strategy of Asian owners.
"I consider the two directors likely to be seeking re-election to be well qualified. As relatively recent appointees it may be unfair to hold them fully to blame. But collective responsibility should not shroud the Board from enquiry. To exercise their votes, shareholders should know which (if any) directors stood up to possibly self-interested pressure from dominant shareholder groups. They should know who (if any) queried the reasoning that led to the Ansett disaster.
"For months I have been demanding explanation for the Government's dithering over Brierley Investments' reported requests for financial help. Then Air New Zealand began publicly promoting the relaxation of foreign control restrictions in its constitution.
"Critics may claim that this action is inspired by politics. I would have preferred to see a candidate who did not risk that distraction. But if the issues are better canvassed because of the controversy it will be worth it in the end.
"I did not announce my candidacy last week because I thought it might prove unnecessary. I thought the Government's package might include a board reconstruction, for example that would make my candidacy in any election irrelevant. Now the decision has been delayed further shareholders should now about it.
"The decision was made after I had been in touch with the Shareholders Association, and others associated with the company. I was researching ways to meet the company's capital needs under the existing flag carrier protection rules in the constitution.
"The Association has proposals to go before the Annual Meeting. I hope they too get the consideration they deserve, and are not pre-empted by the wrong decision from a government inexperienced in business," Stephen Franks.