Transparency. Is it a good thing in business? Apparently so, if you read articles like this one and this one and this one. With that in mind, you’d think that the largest rule-maker of accounting, CPA Australia, would be demanding transparency in financial reporting. And leading by example in its own reporting practices. Yes?
Ever since an understated accountant from Armidale put a rocket under the bum of fellow members of CPA Australia (myself included!) and reminded us to read our own financial reports and company constitutions and decide for ourselves whether $5.5million is a little excessive for 12 board members and 3 executives of a membership body, we’ve been trying to get to the bottom of exactly who gets what.
You’d think it would be simple to disclose this information. After all, accountants are fairly nifty at reading numbers and operating financial systems and even building spreadsheets if that’s what we need to do. But for months the Board has been telling us that the aggregated reporting is just fine, that they are meeting their obligations for minimum disclosure, and their remuneration is not excessive.
The accountant from Armidale (supported by a growing army of members) could not be convinced, and lodged a request with the Company Secretary of CPA Australia demanding under s.202B of the Corporations Act that actual Director remuneration be disclosed. For a month, his request remained unanswered.
In the meantime, the Board did everything it could to cover its tracks, even emailing members to throw doubt on the legitimacy of the rebel actions, and encouraging intimidation of members who dared to speak out. And the media got more and more interested.
That is until tonight, at 10.02pm, when the Board decided it was time to give members what we’ve been asking for: transparency.
Finally, they also showed some common sense in not only revealing the Director remuneration – as is required under the law – but also what the top three executives of the company receive (which we’ve been told repeatedly is not required to be disclosed, under the law).
What we now know is that in 2016, members forked out remuneration to the tune of:
- $1.786m to the CEO, Alex Malley
- $949k to COO Adam Awty
- $902k to COO Jeff Hughes
- $254k to our President, Tyrone Carlin (who also has a full time gig as the Deputy Vice Chancellor of The University of Sydney)
- $358k to our immediate past President, Graeme Wade
- A total of $5.5m in total to the Board and top three execs in just one year (a full breakdown can be found here)
Think this is reasonable for a membership body with around 500 employees? Well, now that we know, it will be up to members to decide. The fact that the member communication was accompanied by the President’s resignation probably gives you a clue.
It’s over to members now to choose their response: sit in silence, or join forces and collate proxies to get the constitution changed (and to do that, you need to join the Armidale accountant’s mailing list here).
For the record, this member thinks it a case of #pigsatthetrough.
And kudos to Joe Aston at the AFR and Brett Stevenson, the Armidale accountant, for driving this. Based on my conversations with our outgoing President and Chair, and communications to Member Services that have fallen on deaf ears, there’s no doubt in my mind that CPA Australia would never have disclosed this information, given a choice.
Yours in dismay,