Can the three Rs save AWI?

Surrounded by sheep as we are, and seeing first-hand how hard farmers work, it’s no wonder I’ve acquired an interest in all things related to the dear little even-toed ungulates. Not just in slathering myself in as many layers of their wool as I can get away with during our long cold Winters, but in how that wool is produced and marketed.

Wool producers have had much to contend with over the past few years: drought, falling prices and the PR fiasco of mulesing.

sheepNow that we’ve had rain, and the mulesing issue has been addressed – at least for the time being – pastures and flocks look set for better things.

But with wool prices at their highest since May 2008, it’s more than a little surprising that differences of opinion within the industry’s peak marketing and research organisation are threatening to jeopardise sales. And it seems the board of directors of Australian Wool Innovation (AWI) can’t agree on much at all.

That’s not so bad, you’d think, a difference of opinion expressed within the confines of the boardroom. But it seems the disputes were taken out for an airing by several board members in front of potential wool customers at the major Italian textile trade fair at Biella earlier this year.

What were the board members thinking? Whatever it was, after hearing AWI’s representatives snipe at each other, the Italians expressed the belief ‘that the delegation didn’t express official AWI thinking.’

So if members of the board of AWI don’t express the official thinking of that organisation, who does?

In a letter to AWI’s chairman, Wal Merriman, the Italian wool processors said, ‘We were very embarrassed and disappointed at seeing people involved in clear conflicts of interest.’

And there definitely are conflicts of interest: two members of AWI’s delegation have interests in Tri-Solfen, a veterinary analgesic for pain relief in surgically mulesed sheep. Another member of the delegation is a wool processor.

AWI is a marketing and research organisation. As of March 13 this year, AWI had no marketing director. Now this modus operandi has come back to bite them.

sheep 2In early March, AWI’s CEO, Brenda McGahan, resigned citing ongoing differences of opinion among board members about marketing strategies .

Then on March 17 company secretary, Susan Myers, quit. In that role, Ms Myers was responsible for corporation law requirements and governance of the board.

While Ms Myers’ reasons for resigning have not been made public, it’s a fair bet to say that the board’s meddling in the day-to-day operations of Australian Wool Innovations, the disputes arising from it, and the conflicts of interest among some board members, could have been strong motivating factors.

In a letter to the Weekly Times on March 24, Professor Gael McDonald, Dean, Faculty of Business and Law at the School of Management and Marketing at Deakin University wrote: ‘Directors must be the critic and conscience of the organisation. Once they start to get directly involved in the operations, they have lost that independence… Research has shown that what is required is for all to stand back, for the roles and responsibilities of the board to be reassessed and the rules of operation established.’

Tony Burke, the Minister for Agriculture, is now threatening to wade into the fray. Just remember the three Rs, Tony: rules, roles and responsibilities.

img04

This entry was posted on Wednesday, March 31st, 2010 at 1:45 pm and is filed under Farming. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

One Response to “Can the three Rs save AWI?”

  1. John Says:

    Baaaah humbug.
    Another reason for Australian producers to take a much bigger stake in what happens past the farm gate. The customer is always right!

Leave a Reply