The Distillery: Gonski's ANZ ascent

Scribes say David Gonski is well suited to chair ANZ, with one noting his journey to the top has been a long time coming.

Future Fund chairman David Gonski appears a sure bet to move to ANZ Bank as chairman, leaving a blank spot at the head of the government fund. Former treasurer Peter Costello has been none too subtle in his desire for the position, but while Gonski’s move helps him, one jotter finds ANZ Bank boss Mike Smith should be well pleased with developments too.

For Gonski, it’s been a long journey to the head of the ANZ Bank boardroom table, according to The Australian’s John Durie.

“Gonski was set to assume the role in 2007 after five years on the board, but quit to take the chair of ASX when it became clear that the bank's incumbent, Charlie Goode, was reluctant to step aside.”

Durie, who views Gonski’s Asian experiences as a bonus for the bank, believes Costello will be a big winner even if “the fund staff would prefer almost anyone but Costello to take the position”.

Fairfax’s Elizabeth Knight says Costello turned on the music for the latest game of musical chairs and in so doing may have inadvertently lifted the spirits of ANZ Bank chief executive Mike Smith. It comes down to the Asian experience of Gonski, which could prove priceless as ANZ Bank’s Asian expansion is increasingly questioned.

“Reshuffle talk, while driven by Costello, also suits ANZ's Asia-obsessed chief executive Mike Smith – who needs as much support at the board level as he can muster in his quest to increase Asian revenues to 30 per cent of the total by 2017. Whether he is given time or the opportunity to complete this ambition depends on the results. The returns from the Asian region … have been questioned since third-quarter margins have come under increased pressure.”

Smith isn’t the only Australian-based chief executive facing pressure over overseas activities, with Treasury Wine Estates chairman Paul Rayner confronting unrelenting calls to scale back the group’s US operations. The wine group has now been hit with a class action over continuous disclosure obligations and, according to Fairfax’s Adele Ferguson, this should be the catalyst for a long overdue divestment of its troubled US business.

“When Treasury Wine Estates was part of the Foster's Group empire the wine business was seen as a poison pill. Once it decided to hive off its wine business into a separate entity, Treasury Wine, it was tantamount to putting up a ‘for sale’ sign for its beer business. As a separately listed entity, Treasury Wine Estates needs to take a leaf out of the Foster's book and sell the US business, a move that will likely put up a ‘for sale’ sign for its Australian business.”

In politics, the Abbott government appeared to be dusting off the welcome mat for China’s Huawei for the national broadband network, but comments from Attorney-General George Brandis make that incredibly unlikely. The Australian Financial Review’s international editor Tony Walker contends that news of a continued ban on Huawei are a body blow to the company and a sign of where Australia still stands on national security matters.

“The Coalition’s decision to maintain the Huawei ban left over from the Labor government represents a clear indication that in matters of national security Australia’s relationship with the United States will remain paramount. The new government was hardly likely to depart from a decision based on the advice of US security agencies.”

Elsewhere, The Australian’s Glenda Korporaal analyses the Australian moves of private equity player Blackstone as it spruiks plans to invest plenty more cash in Australia, particularly in property.

The Herald Sun’s Terry McCrann outlines how typical shareholders are having their money "stolen” by corporate Australia. The discrimination that is hurting small shareholders isn’t quite as strong as pre-GFC – but it still hurts.

Finally, the AFR’s Chanticleer columnist Tony Boyd welcomes a new market surveillance tool that should ensure fewer insider trading events go unnoticed, and Fairfax’s Michael Pascoe asks the question: is the Australian economy prepared to handle a population increase of 2.3 million in the next five years?