Joyce ‘retires’ early 👍
New Qantas chief Vanessa Hudson confronts a turbulent ride from shareholders at AGM today
by Michael Sainsbury | Nov 3, 2023 | Comment & Analysis, Latest Posts
Image courtesy of Qantas and virginia.orgOnly two months into the job, the pinnacle of a three-decade career at Qantas, new chief executive Vanessa Hudson faces a mountain of troubles as she meets the company’s shareholders at the annual meeting today alongside chairman Richard Goyder. Michael Sainsbury analyses the Qantas corporate culture.
Hudson and Goyder must be expecting a big turn-out. The AGM is being held at the Melbourne Conference and Exhibition Centre. This was supposed to be the fairytale ending of one of corporate Australia’s lobster farewells for her predecessor, Alan Joyce. Instead, it will be a baptism of fire for Hudson, as angry shareholders vote to elect her to the company’s embattled board.
Goyder, never one to be bested, has set up his own, even longer farewell – getting ahead of growing calls for his resignation by announcing a long-dated departure last month. But he may already be wishing he had not, the cool $750,000 or so that he will collect along the way notwithstanding.
He may experience the ignominy of watching one of his chosen directors, Todd Sampson, fail in his bid for reelection. And he may quite possibly collect a dreaded ‘first strike’ with 25 percent of shareholders’ vote against the company’s remuneration report. A second strike at next year’s AGM would see a spill of all directors.
As part of his own skin-saving exercise, Goyder has prevailed on fellow directors Jacqueline Hey and Maxine Brenner to step down. An early signal of shareholder fury at Qantas directors was the unusual 7% vote against Brenner when she stood (successfully) for the Telstra board last month. But that’s how it rolls in corporate Australia, fail at one blue chip company only to get a rails run onto a seat at another.
Lack of succession planning
A common feature, as has been noted, of Goyder’s boards (e.g. Woodside, AFL) is the clear lack of a succession plan. Qantas is now searching for a credible replacement from outside the current board. In any case Qantas is well overdue some fresh eyes, because the strong early signs are that Hudson is simply, “Alan with a wig,” as one wag put it,Hudson, too, has surrounded herself with “friends and favours” in the expanded 13 person executive team, according to one insider. Only one, Andrew Monaghan, has any real operational experience, extraordinary for a company whose core business is uber-operational logistics.
This week, she fluffed her chance at bringing more operational experience onboard when she replaced the outgoing QantasLink chief John Gissing after an international search, with Rachel Yangoyan, a company veteran who rose up through the ranks in loyalty marketing.
Perhaps even more head-scratching is that Qantas is now that very rare ASX100 company that has a chief financial officer, Rob Marcolina, who has little apparent accounting/finance qualifications or experience. In many ways, Marcolina, who was running strategy and human resources, represents one of the key failings of the Joyce era – and one that increasingly inflicts corporate and bureaucratic Australia – the inexorable rise of consultants.
Marcolina cut his teeth working in consultancy in New York and then later 13 years at Bain & Co in Los Angeles and Sydney, joining Qantas 11 years ago after a short stint running Basketball Australia.
Consultants rule
Joyce became enamoured of consultants during the time he and former Qantas chief Geoff Dixon created Jetstar with the help of the Boston Consulting Group (BCG). Since then, former and current Qantas executives say, consultants have been a permanent feature of the airline.‘
One former Qantas executive who worked under Joyce for many years, told MWM that “they fell in love with consultants after the Jetstar thing, and it just got worse and worse and worse. Then they started importing them into the business. And what you would see is all they were good at was gathering information to tell a story to present to those higher up. But what actually happened beneath them didn’t matter. It was irrelevant.”
“And I think that’s a lot of what’s happened with Qantas is you’ve got these people at the top who have been so focused on keeping people above them happy, but no one’s really looked at what’s happening.”
The number of times that management has been able to convince themselves – and I really mean convinced themselves of being right, when quite clearly what they were doing was wrong – was astounding.
“Consultants also helped to create an environment where everyone agreed with them and with Joyce. The problem was, that quite a few years out from the end, there was no one in the company – probably not even the board – who would say no to Alan. there was no one to tell him that this or that was a dumb idea.”
Those dumb decisions – the illegal sacking of 1,700 staff, the outrageous selling of tickets on 8,000 flights that had been canceled, the widespread passenger fury at the collapse in standards at the airline due to its staff, service standards and infrastructure’s death by thousands of cuts finally caught up with Alan Joyce just before the planned end. They are now Hudson’s problems.
To fix them, it’s hardly a surprise that she called in BCG – fresh off a major project for Qantas Loyalty to try and boost its revenues, once more.
Those pesky customers
After “apologising” to customers when taking up the top job, it has taken Hudson barely eight weeks to turn her back on them once more. Hudson has hiked fares by 3.5% last month blaming the oil prices. The problem is, the Jet Fuel price averaged 14.5 less last week than a year earlier. Just in case customers have any delusions that things may be different this time, along came Qantas’ bizarre defence to the Australian Competition and Consumer Commission’s lawsuit in the Federal Court for the 8,000 “ghost” flights. Instead of biting the bullet and showing that change had happened and settling, easily blaming it on Joyce.Behind the defence is Qantas preening, combative General Counsel Andrew Finch, who was responsible for the disastrous High Court finding of illegal sackings, and recently admonished a Senate inquiry to wrap up because he might miss the last plane to Sydney. So many ironies and frankly, it’s bewildering that Finch still has a job.
Hudson has doubled down on her fight with the pilots’ union at Perth-based subsidiary Network Aviation with the two sides now heading for four-day mediation next week. That too may be a problem as MWM can reveal that Rob Rousset and Graham Pozzi two of the union reps for the TWU – one of three unions involved – are members of Qantas management, blowing up the secrecy of Fair Work Commission Deputy President Melanie Binet this week. Having Qantas management as union reps meant the company was party to confidential conversations between Binet and unions.
(Tail) spin over substance
And spin – the hallmark of the Joyce era continues taking precedence over substance with the high profile relaunch of flights to Paris and Shanghai. The problem is, Qantas can not fly these routes with the daily regularity it would like due to the dire lack of aircraft.
Qantas plane courtesy of NauruThe company’s aircraft shortage continues to plague its international schedules with an engine damaged in New York, causing serial cancellation on the Pacific route and further chaos caused by a lightning strike on a Boeing 787.
Qantas has also cut the through flight from Melbourne to London (via Perth) for the first time, preferring to let Sydney passengers fly to Rome and Paris through Perth, causing a tsunami of negative feedback on social media groups.
Qantas’ long haul aircraft shortage is so bad that it’s one of two ‘wet lease’ planes from Finnair began working the Singapore-Sydney route with another due to start Sydney-Bangkok in the new year.
It has also leased a Nauru Airlines plan to fly its Perth-Broome route (and potentially strike break). Pilots reported that it flew without air conditioning Thursday.
Qantas will not take delivery of any new long haul aircraft until at least 2027, so customers can continue to expect problems flying internationally until then, as planes age, are worked harder and shortages in the maintenance division – in both staff and spare parts continues.
One engineer told MWM:
Nothing has changed. We still don’t have enough parts, planes flying with multiple maintenance issues – they are still allowed in the air but not everything inside works.
Enjoy your next flight.
short flights long nights
I say again… they all need to go. Everyone needs to be replaced with people who actually know about airlines
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Surely the final nail in the coffin for Goyder? How can he continue? He’ll make a good politician with his obfuscation and at time rambling responses to questions. Shutting down a question about the timing of Joyce’s share sale was an astoundingly poor response from him. An absolute embarrassment.
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a chief financial officer, Rob Marcolina, who has little apparent accounting/finance qualifications or experience.
One former Qantas executive who worked under Joyce for many years, told MWM that “they fell in love with consultants after the Jetstar thing, and it just got worse and worse and worse. Then they started importing them into the business. And what you would see is all they were good at was gathering information to tell a story to present to those higher up. But what actually happened beneath them didn’t matter. It was irrelevant.”
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I'm not a pilot but over the years I've spent many hours (pre 9/11) riding on jump seats and I guess nothing much has changed: On short haul, there's plenty to do and the non operational chatter is almost non existent but on long haul there is plenty of time for gripes and discussion about matters of relevance to the pilots but not directly related to the task at hand.
Had a seven and a half hour flight yesterday on a QF jet. Sitting in my narrow Y class seat because I chose the extra leg room of a bulkhead rather than easy access to the "entertainment" I pondered the posts above I'd read in the lounge prior to departure and in the preceding weeks, presumably many of which were from pilots of the said airline. What discussion was in progress up front as we cruised over Ayres Rock? And more importantly, how quickly could the crew drop that and react to problem with the aircraft? Pretty promptly I guess, from experience but...
Does the QF SMS include the very current risk of these discussions having a negative impact on operational capability and flight safety and has CAsA considered this in their role as the safety oversight regulator?
I was once asked how effective I considered a national safety oversight regulator (not CAsA in that case but I'm starting to think it now applies to CAsA). I responded at the time, "About as effective as a perished rubber band around a 2" fire hose just before the water is turned on."
Gne
Had a seven and a half hour flight yesterday on a QF jet. Sitting in my narrow Y class seat because I chose the extra leg room of a bulkhead rather than easy access to the "entertainment" I pondered the posts above I'd read in the lounge prior to departure and in the preceding weeks, presumably many of which were from pilots of the said airline. What discussion was in progress up front as we cruised over Ayres Rock? And more importantly, how quickly could the crew drop that and react to problem with the aircraft? Pretty promptly I guess, from experience but...
Does the QF SMS include the very current risk of these discussions having a negative impact on operational capability and flight safety and has CAsA considered this in their role as the safety oversight regulator?
I was once asked how effective I considered a national safety oversight regulator (not CAsA in that case but I'm starting to think it now applies to CAsA). I responded at the time, "About as effective as a perished rubber band around a 2" fire hose just before the water is turned on."
Gne
Does the QF SMS include the very current risk of these discussions having a negative impact on operational capability and flight safety and has CAsA considered this in their role as the safety oversight regulator?
The primary reasons given for the delays in removing cancelled flights from sale included to give staff time to establish alternative travel options for customers; to avoid further blowouts in call centre wait times and in some cases human error. was to remove from the customer the option of quickly choosing to take their business elsewhere.
Or, remember, we've already got your money, and we'll be the ones who decide how, when or even if we'll give it back.
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Hopefully the ACCC comes down on the management team like a ton of bricks. What they did was take people’s money for fake services, and then back them into a corner where they couldn’t take their business elsewhere.
Goyder’s toys out of the pram response to the share sale question proves he has a lot to hide.
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Goyder quickly shuts down a question about the share sales. Goyder orders the microphone turned off on another shareholder's question. "We are paying for your lack of ethics," Canberra shareholder Chris Maxworthy said, before his microphone was muted at the request of Goyder. What a gutless grub. The board has "admitted" they got things wrong. What, they couldn't see everything they were doing was extremely morally wrong BEFORE they did it.??? Some board. Even Slippin' Jimmy McGill/Saul Goodman couldn't defend these goats. And where's Elaine? Another gutless grub.
The only good news is that all this happened before Elaine had left - he didn't get to leave with a (delusional) shining legacy. He left a mess and that is what he'll be remembered for.
Why are people still flying with QF? Makes me sure that this will all blow over.
The only good news is that all this happened before Elaine had left - he didn't get to leave with a (delusional) shining legacy. He left a mess and that is what he'll be remembered for.
Why are people still flying with QF? Makes me sure that this will all blow over.
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I think the management are on a quest to see if they can get the share price to hit zero. Has that ever been achieved before anywhere in the world, would be a feather in their caps, a world first? 
It's a shame the question wasn't asked of goyder/Hudson if the joint was actually still solvent?
What terminals are left that they own? What realestate do they own?
What GSE do they own? What price did Alan onsell the 78 options at? Why 2027 for the next long haul aircraft delivery?
How to fund the huge capex for Qantas moving forward?
Take away the cash of front paying customers and what's left?
Why a bonus for any employee?
The beauty I guess is they'd re nationalise if it came to that.
What terminals are left that they own? What realestate do they own?
What GSE do they own? What price did Alan onsell the 78 options at? Why 2027 for the next long haul aircraft delivery?
How to fund the huge capex for Qantas moving forward?
Take away the cash of front paying customers and what's left?
Why a bonus for any employee?
The beauty I guess is they'd re nationalise if it came to that.
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Why 2027 for the next long haul aircraft delivery?
I nearly puked when I saw “Joyce Drive” on a lit roadworks sign at Mascot the other day…….My immediate thought was “there’s no way……..!” etc
Turns out that it was named after a local Alderman from the 1950s. But the stench is real…that name and airports/aviation don’t go together.
got me thinking - some “A. Joyce” stencils and black spray paint onto the sides of all Australian LAV service trucks would be a nice touch.
And on the topic of competition with QF - I reckon that VA has joined the race to the bottom with its new (ex-QF) leadership showing all the signs of destroying what used to be a great domestic travel option for regular travellers in their shortsighted greed. I have been away for a year and a half and having just come back see it with fresh eyes.
Turns out that it was named after a local Alderman from the 1950s. But the stench is real…that name and airports/aviation don’t go together.
got me thinking - some “A. Joyce” stencils and black spray paint onto the sides of all Australian LAV service trucks would be a nice touch.
And on the topic of competition with QF - I reckon that VA has joined the race to the bottom with its new (ex-QF) leadership showing all the signs of destroying what used to be a great domestic travel option for regular travellers in their shortsighted greed. I have been away for a year and a half and having just come back see it with fresh eyes.
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Arent A350s for project sunrise and A321s meant to arrive sometime in 2025?
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Goyder said at the AGM:
Goyder’s got his head stuck firmly up his arse if after all the bad news of recent weeks he can’t (or refuses to) see that Joyce’s destructive and toxic (mis)management has been the main driver that's trashed the Qantas brand.
Goyder also appears to have let his arrogance, ego, power, and authority overrule his obligation under Section 250 of the Corporations Law 2002 by shutting down shareholder Chris Maxworthy’s question about the decision to allow Joyce to sell most of his shares shortly before the ACCC announced it was taking the national carrier to court for allegedly selling tickets for cancelled flights.
By doing so, Goyder didn’t allowMr Maxworthy a reasonable opportunity to ask his questions, and to make comments, especially as they related to the ethics of Qantas management.
The conduct of the Board at the AGM was predictable. The same old insincere and, so far, meaningless bull**** apologies, no commitment to treat staff OR customers better, and no tangible plans about how the damage to the brand will or can be repaired.
Seems to me that with the Qantas ‘defence’ to the ACCC proceedings, the ongoing refusal to fix the Network Aviation issue, and the way that the Board handled the AGM yesterday, the leopard clearly can’t/won’t change its spots, and we’re in for more of the same poor behaviour.
So, maybe you’re right Megan, and the plan of the Qantas Board and (mis)management is to have the share price at $0.00. Who really knows?
But at the very least, it would be a real achievement for the morons.
I also want to acknowledge the contribution made by Alan Joyce. Alan was the founding CEO of Jetstar for five years before becoming CEO of the Group for 15 years. He guided this company through some of its biggest challenges, which meant making some tough decisions.
Goyder also appears to have let his arrogance, ego, power, and authority overrule his obligation under Section 250 of the Corporations Law 2002 by shutting down shareholder Chris Maxworthy’s question about the decision to allow Joyce to sell most of his shares shortly before the ACCC announced it was taking the national carrier to court for allegedly selling tickets for cancelled flights.
By doing so, Goyder didn’t allowMr Maxworthy a reasonable opportunity to ask his questions, and to make comments, especially as they related to the ethics of Qantas management.
The conduct of the Board at the AGM was predictable. The same old insincere and, so far, meaningless bull**** apologies, no commitment to treat staff OR customers better, and no tangible plans about how the damage to the brand will or can be repaired.
Seems to me that with the Qantas ‘defence’ to the ACCC proceedings, the ongoing refusal to fix the Network Aviation issue, and the way that the Board handled the AGM yesterday, the leopard clearly can’t/won’t change its spots, and we’re in for more of the same poor behaviour.
So, maybe you’re right Megan, and the plan of the Qantas Board and (mis)management is to have the share price at $0.00. Who really knows?
But at the very least, it would be a real achievement for the morons.
As I thought one share holder reminded Goyder the board and executives work for those shareholders not the other way around. The arrogance of Goyder left me shocked.
Goyder also appears to have let his arrogance, ego, power, and authority overrule his obligation under Section 250 of the Corporations Law 2002
Commonwealth Consolidated Acts
[Index] [Table] [Search] [Search this Act] [Notes] [Noteup] [Previous] [Next] [Download] [Help]CORPORATIONS ACT 2001 - SECT 250S
Questions and comments by members on company management at AGM (1) The chair of an AGM must allow a reasonable opportunity for the members as a whole at the meeting to ask questions about or make comments on the management of the company.(2) An offence based on subsection (1) is an offence of strict liability.
Note: For strict liability , see section 6.1 of the Criminal Code .
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