CEO's trail of disaster

As the beleaguered Melbourne Football Club yesterday severed its ties with Mr Polis' company Energy Watch, it emerged that Mr Polis had been accused of presiding over a culture of workplace drug use, sexual harassment, racism and underpayment of staff.

The allegations came to a head after the exposure of a raft of racist and sexist Facebook posts by Mr Polis. Hours later, it was revealed Mr Polis had resigned as a director and as chief executive of Energy Watch.

"I suffer from attention deficit disorder and struggle with my impulsive behaviour," he told The Saturday Age. "I had a breakdown a few years ago, and the stress has been eating away at me. Therefore I was in the process of stepping down to focus on my health."

The Saturday Age has also learned that an investigation of Energy Watch conducted by the Victorian Employers' Chamber of Commerce and Industry in February uncovered "red flags" in the company founded by Mr Polis and Luke Zombor. According to an internal VECCI email, allegations against Energy Watch management included:

Unresolved claims of workplace drug use and sexual harassment.

The suspension of a staff member, who was also an Australian Services Union delegate, without any supporting documentation.

Mr Polis falsely telling the staff member he was being investigated by federal police.

Under-payment of wages and non-payment of superannuation.

The claims come as clients, sporting clubs and media partners of Energy Watch which runs an energy brokering service abandoned their relationships with the company in response to the offensive Facebook posts. Mr Polis has attacked Aborigines, Asians, women and Prime Minister Julia Gillard on his Facebook page. He is also accused of ridiculing EnergyWatch customers who signed up to his business on Christmas Day as "Muslims and Jews" and claiming Asian girls "add no value to society apart from insurance premiums 'cause they can't drive."

The three sports clubs sponsored by Energy Watch Melbourne Football Club, Melbourne Victory and Melbourne Rebels all terminated their deals with the company.

Loss of the $2 million Energy Watch sponsorship could be a major financial blow for the cash-strapped Demons, which made a razor-thin operating profit of $136,000 last season. The sponsorship represented about a quarter of the $8.1 million it reaped from sponsorship and fund-raising last year.

Key clients TRUEnergy and Momentum Energy also terminated their contracts, throwing the future of Energy Watch into doubt.

VECCI chief executive Mark Stone confirmed that an email from one of his advisers to Mr Zombor was genuine.

The email, which has been distributed to Energy Watch's corporate clients, advised Mr Zombor to look at "any way of cleaning up/filing away any evidence laying around in relation to any drug/sexual harassment/other types if past claims or issues."

The VECCI adviser added: "Please ensure these are resolved and fully closed . . . it does appear employees have had or do have their hands on certain information in relation to the above examples which may be detrimental to Energy Watch and its sponsoring."

The peak business body was also providing advice to Energy Watch management on how to handle a potential unfair dismissal case. The adviser criticised Mr Polis after he allegedly "made threats on behalf of VECCI" to a suspended employee identified as "Brad".

"The [Australian Services Union was] of the impression that the federal police would be present during VECCI's investigation meeting and had contacted the federal police themselves and obtained legal advice," stated the letter to Mr Zombor.

"At no stage has VECCI ever mentioned the involvement of the federal police so I'm not sure why this information has been told to Brad."

VECCI boss Mark Stone said his organisation terminated its dealings with Energy Watch a week after the email was sent.

"We were contracted by Energy Watch to consult on their management structure," Mr Stone told The Saturday Age. "In the course of that job, after interviews with staff, a whole lot of other issues came to light.

"They included the misrepresentation that we had contacted the federal police."

Energy Watch was in the process of restructuring after Mr Polis stepped down as a director in early February due to stress.

"I have been under a lot pressure, with building and running a company the size of Energy Watch. I started it when I was 26 and have no formal training in running a business I have created," he told The Saturday Age.

Previous business ventures run by Mr Polis have left behind a string of creditors owed hundreds of thousands of dollars. His company Polis Australia collapsed in 2009, owing creditors including the Australian Taxation Office, corporate raider Nicholas Bolton and Fairfax Media, which owns The Age, more than $283,000.

The pair registered Energy Watch February 2009, but Mr Polis quit as a director on February 13, 2012. His move came after Mr Zombor in December registered a company with a similar name, Energy Watch Business.

Energy Watch made money acting as a broker between electricity and gas companies, and retail customers. It would receive a commission each time a customer signed a new supply agreement.

Mr Zombor remains the sole director and shareholder of that company and also Freedom SEO, which sponsors Melbourne Victory.

Meanwhile media outlets yesterday struck Energy Watch off their advertiser lists. The general manager of 3AW, Shane Healy, said the station had "no option but to remove the Energy Watch commercials from the 3AW airwaves".

The Age yesterday confirmed Mr Polis had qualified for a travel package as part of an advertising incentive program.

"This is an entirely legitimate practice. Energy Watch's advertising relationship with The Age received no special treatment. All advertising relationships are governed by the same terms and conditions," chief executive and publisher of The Age, David Hoath, said.

"The Age has withdrawn any booked advertising by EnergyWatch."