It was a year of red dust, red ink and red envelopes. But which business leaders have been naughty and which ones nice? CBD's Ben Butler hands out the presents to 2012's big achievers.
MAJOR MINER OF THE YEAR
Gina Rinehart. From YouTube to the Pilbara, Her Roy Hill Highness was everywhere this year. If she wasn't provoking outrage by contrasting Africans willing to work for $2 a day with feckless Aussies who spend all day down the pub, the poetical Pilbara princess was out on the town signing copies of her Little Red Dust Book, Northern Australia and then some. Pooping the party only slightly was her wrong bet on the fourth estate, in the shape of stakes in Fairfax Media and Ten Network.
MINOR MINER OF THE YEAR
Nathan Tinkler. Like the Scarlet Pimpernel, they seek him here, they seek him there. However, there are signs the ability of the swashbuckling boganaire to swoop in at the last moment and save his companies from the judicial guillotine is becoming stretched.
Creditors have already wound up his Mulsanne Resources and companies associated with his thoroughbred stable, Patinack Farm, while the taxman is circling Hunter Sports Group, the vehicle through which he owns the Newcastle Knights and the Newcastle Jets.
And of course running things from Singapore, where readers have spotted Tinkler strolling by the river and applying for membership at the cricket club, must make things more difficult. Especially when pesky financiers have seized your private jet and helicopter.
THE BIG THINKER
Clive Palmer. He said he would run for Parliament against the Treasurer, Wayne Swan, described the Greens as a CIA-funded plot, started a shipping business, announced plans to build a full-size replica of the Titanic, tried to start a rival football league to Frank Lowy's Football Federation Australia, became a national living treasure, was suspended from the LNP before being reinstated and resigning on the same day, got a passing mention in the failed sexual harassment case brought by James Ashby against the former speaker Peter Slipper, was interviewed on Lateline from Tahiti wearing a tropical garland, took delivery of a mechanical T-Rex for his dinosaur park, toyed with buying into Fairfax, fought a legal battle with Hyatt Hotels over management of his Coolum Resort, got a speeding ticket, bought Bora Bora resort in Tahiti and the Sea Temple golf course in Port Douglas, said he wanted to get drunk and wear a top hat to the Melbourne Cup after becoming governor-general, warned his Chinese business partners that Australia was not a communist country, fought with business partners CITIC over an iron ore mine in the Pilbara, and called for more lenient treatment of asylum seekers.
Phew! But wait, just a fortnight ago, Palmer was named joint secretary general of something called the World Leadership Alliance, which according to the press release from his flack trumpeting the appointment "will be the major adviser to the G20 summit" in Brisbane in 2014.
Never heard of the World Leadership Alliance? Palmer is closely involved in the global pow-wow, which features a troughload of former politicians and takes in a couple of other leadership organisations. Indeed, Palmer's company, Mineralogy, registered the trademark back in July.
SOL TRUJILLO FREQUENT FLYER PERPETUAL TROPHY
Mike Smith. The Asiaphilic ANZ boss was spotted on Google Earth with mysterious red bags and on endless video loop at Hong Kong Airport, while his ATMs kept the good people of Singapore's Orchard Towers, aka the Four Floors of Whores, supplied with ready cash. But it seems the Chevalier de l'Ordre du Merite Agricole is to call Australia home after all: this year he said he was considering becoming a citizen and pooh-poohed suggestions he would replace the suddenly departed Bob Diamond at the British bank Barclays. And, of course, he reiterated his dislike of London. "If you live in central London, you have to speak Russian and have a lot of roubles," he told a business breakfast.
THE "WE USED TO BE FRIENDS, A LONG TIME AGO" AWARD
Qantas boss Alan Joyce and the man who preceded him in the gig, Geoff Dixon. Their days lunching together seem over forever, now that they are on opposite sides of the battle for the Flying Kangaroo.
Family man of the year: Lachlan Murdoch, whose Ten Network gave his wife, Sarah, a gig hosting the talent show Everybody Dance Now. It lasted just 10 days.
Lachlan's pick for host of the struggling network's new Breakfast show, the Kiwi controversialist Paul Henry, did a little better. That show was canned last month after dismal ratings all year.
FRIEND OF THE YEAR
James Packer. He quit media in favour of gambling yonks ago, but jumped on the Ten Network register with mate Lachlan. Never mind that the pair of heirs did so poorly as directors of long-ago flop.com One.Tel - this time would surely be different.
Alas, the millionaire mates' media mission is yet to deliver, with the pair's stake shedding value at about the same speed as viewers turned off Everybody Dance Now. Perhaps Slim Jim's new Hollywood venture with the director Brett Ratner will be more red carpet than red ink.
EMPLOYER OF THE YEAR
Mark Bouris. The reality TV star, BusinessDay columnist and finance guru sacked employees of his struggling tech company TZ Limited in July after it missed out on an Australia Post tender in May. "You're fired," indeed. In other staff woes, his finance outfit Yellow Brick Road suspended the mortgage broker Andrew Kaidbay late last month after he admitted lying to the NSW Independent Commission Against Corruption to protect Paul Obeid. The ICAC is investigating Paul's dad, Eddie, over allegedly corrupt mining deals worth tens of millions of dollars.
LAWYER OF THE YEAR
Michael Harmer has plenty to meditate on during his summer holidays. It must have seemed a jolly lark back in April, filing paperwork on behalf of James Ashby alleging he had been sexually harassed by his boss, the speaker Peter Slipper. The lawsuit seemed a headline-grabbing echo of Harmer's efforts on behalf of Kristy Fraser-Kirk against the then chief executive of David Jones, Mark McInnes, back in 2010, which resulted in an $850,000 settlement.
The Ashby case brought many jolly japes - sexy texts, a jar of mussels, Slipper's slippery effort sneaking out the back door of the Federal Court - but it's all come rather unglued for the Gandhi-loving Harmer, with the Federal Court's Justice Steven Rares making adverse findings about his conduct as a lawyer and Slipper demanding Harmer's firm pay every cent of his costs.
MOST LOYAL SUPPORTER OF M'LEARNED FRIENDS
Solomon Lew. The rag-trading billionaire demonstrated his taste for the courtroom early, entering the year already locked in furious litigation with the former partners of two of his children over stakes in a family trust fund worth tens of millions of dollars. He followed up with a spectacular own goal while seeking to have coverage of the case suppressed: in open court, his own counsel decried the fourth estate for unfairly portraying Sol as a "greedy ogre". Cue fresh headlines.
Then there was the stoush over a pool built on Crown land beside his holiday home in Victorian coastal enclave Mount Eliza, which he was ultimately forced to demolish. Oh, and the US litigation sparked when one of his mega yachts, the Maridome, clipped the mobile phone billionaire Wendy McGraw's equally grand Calixe in a Florida shipyard, causing more than $500,000 in damage. All in all,
a generous patron to practitioners of the world's second-oldest profession.
NATIONAL BROADBAND NETWORK CHAMPION
Geoffrey Edelsten. Can superduper internet arrive quickly enough to meet the web surfing needs of the disgraced former doctor, bankrupt and jailbird? In addition to maintaining his not-at-all creepy and misogynistic "Australia's Worst Journalist" contest website (CBD: winner, 2009), the not-doctor also found the time to hang out at the salubrious sugardaddyforme.com website (where "no communications regarding the exchange of sex for money are permitted"). Happily, he struck up a friendship with the American lass Stacey da Silva through the website and loaned
her $5000.
Sadly, she failed to keep their contact confidential, and the whole thing ended up in court where both earned a kicking from the Victorian Supreme Court judge David Beach. "The one piece of evidence that could confidently be accepted from each of them is when each of them said that, in respect of certain matters, the other was being untruthful," Justice Beach said.
Frequently Asked Questions about this Article…
Which mining leaders were highlighted in the article and what should investors know about them?
The article singles out Gina Rinehart (Major Miner), Nathan Tinkler (Minor Miner) and Clive Palmer (Big Thinker). Rinehart was prominent for high‑profile moves including stakes in Fairfax Media and Ten Network; Tinkler faced creditors winding up Mulsanne Resources and seizures related to Patinack Farm with the taxman circling Hunter Sports Group; Palmer pursued a wide range of ventures (from mining disputes with CITIC to trying to buy media assets) under his Mineralogy banner. Everyday investors should note that high publicity can mask operational and balance‑sheet risk in mining companies.
How did media investments and TV ventures perform for owners like Lachlan Murdoch, James Packer and Gina Rinehart?
The article describes mixed to poor outcomes: Ten Network (linked to Lachlan Murdoch) struggled — Everybody Dance Now lasted just 10 days and other new programs were canned after low ratings — while James Packer and Lachlan saw stakes lose value. Gina Rinehart’s bets on Fairfax and Ten are described as a “wrong bet.” For investors, weak ratings and management missteps in media businesses can quickly erode shareholder value.
What legal and governance risks mentioned in the article should shareholders watch for?
Several items underline legal and governance risk: Michael Harmer faced adverse findings in the Ashby/Slipper case and was ordered to pay costs; Solomon Lew was embroiled in family trust litigation and court publicity; Mark Bouris’s Yellow Brick Road suspended a broker after an ICAC‑related admission tied to Paul Obeid, and Eddie Obeid was under ICAC investigation for alleged corrupt mining deals. These examples show how legal exposure and investigations can affect company reputations and financial outcomes — something investors should monitor closely.
What does the article say about leadership battles and management turnover that could affect investors?
The piece highlights leadership clashes and upheaval: Qantas’s Alan Joyce and predecessor Geoff Dixon are depicted as on opposite sides of the airline’s battle for direction; Clive Palmer experienced party suspension, reinstatement and resignation in quick succession; Mark Bouris fired staff at TZ Limited after a failed tender. Such management disputes and turnover can create strategic uncertainty and operational disruption that matter to investors.
Are there examples of failed business ventures or projects investors should be aware of?
Yes. The article cites short‑lived TV projects (Everybody Dance Now lasted 10 days; Paul Henry’s breakfast show was canned) and troubled companies (TZ Limited missed an Australia Post tender leading to sackings). It also references historical media flops like One.Tel to underline how repeated poor ventures can erode investor confidence and share value.
What happened to Nathan Tinkler’s companies and why does that matter for investors?
Creditors wound up Mulsanne Resources and took action against companies linked to Tinkler’s Patinack Farm; financiers seized assets including his private jet and helicopter and the taxman was investigating Hunter Sports Group. For investors, creditor action and asset seizures signal elevated default and liquidation risk, making it important to assess a company’s solvency and creditor exposure.
How do high‑profile, diversified entrepreneurs like Clive Palmer affect investor sentiment?
Clive Palmer’s wide range of headline‑grabbing activities — from plans for a Titanic replica and a shipping business to legal disputes with Hyatt and attempts to buy media assets — create unpredictability. The article suggests that such scattergun, high‑publicity moves can make the business direction hard to forecast, increasing perceived risk for everyday investors in companies tied to charismatic but mercurial owners.
What examples of reputational risk are in the article and how can they impact shareholders?
The article gives several reputational examples: Solomon Lew’s attempts to suppress media coverage backfired and led to more headlines; Geoffrey Edelsten’s online and court disputes attracted publicity; high‑profile executives (eg. James Packer, Lachlan Murdoch) saw media investments underperform. Reputation damage can translate into customer loss, regulatory scrutiny or depressed share prices, so investors should factor reputational risk into their analysis.