The blame game.18 Feb 2023 06:47
Many new CEOs like to take the opportunity to blame a company's woes on previous management and Caldwell is no exception - although he's done it in a way and with such vehemence as I've rarely ever seen. So who is to blame and is Caldwell justified?
As to justification, I would say yes. The lack of a strategy which the market believed and a never ending catalogue of missed deadlines, combined with an unjustifiable degree of hubris, appears to support the argument.
So, who is to blame? NM was obviously in charge for a long time and it became apparent the company had moved into a phase that was beyond his competency. Simultaneously, his seeming arrogance clearly alienated many people and I can't recall a single occasion when he apologised for missed deadlines. He appeared to have no interest whatsoever in appeasing shareholders and he ultimately paid the price.
DC was simply useless and in retrospect it seems his appointment was probably borne out of desperation to fill a vacant post with someone who may have been able to mend fences with BHP. He failed.
But, in my book, it's the chairman who bears overall responsibility. He has overseen a company which was clearly dysfunctional on many levels (the $4m fraud was surely an indicator of a lack of control). His task is to have an effective board which delivers targets on time and to have a strategy which is realistic and enhances shareholder value. He failed on numerous levels and his only solution was to keep on appointing wholly unnecessary non-execs to the extent that our board had more members than many FTSE 100 companies - most of whom have now gone.
At the time of his appointment I raised questions about his experience and his first public outing as chairman - the 2019 AGM, was a total disaster and confirmed my concern.
All I can say he's lucky he's not facing an imminent AGM, because I don't think he'd survive and perhaps he should be considering his position.
I think the only reasons for keeping him are the need to stability and the fact that he's been sufficiently chastened by events that he's now nothing more than a figurehead who will do whatever Caldwell tells him.
Yesterday's announcement was a watershed moment and I suspect the organization rationalization will be significant and profound. It was an uncomfortable day for us all, but it was long overdue and now Caldwell is firmly in the spotlight and has nailed his colours to the mast as well as trashing two of his colleagues, he damn well better deliver...and soon.
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