The Council of Small Business Australia has fought back against claims by its former chairman that the organisation is controlled by the big tobacco companies.
Ken Phillips told SmartCompany his shock resignation from COSBOA’s board a month ago was a result of the involvement of “tobacco interests” in COSBOA.
“They control the organisation and it’s financially dependent for its solvency on money from tobacco,” he says.
“I don’t believe it’s a good look in terms of the lobbying for small business, the dominance just does not serve small business lobbying.”
Phillips says tobacco companies have given COSBOA “tens of thousands” of dollars and that the tobacco companies control the numbers on the board and on the council.
He says he resigned after failing to try to balance the numbers on COSBOA’s council and board.
“I have been attempting to bring a balance and I concluded that I was not able to achieve that balance, I did not want the tobacco interests controlling it, I wanted this to be a broad church,” he says.
“The board of Independent Contractors Australia concluded [COSBOA] was not a viable association to be associated with in terms of achieving high quality policy outcomes for small business people there is no value in being involved with a dead horse.”
However COSBOA has fought back against Phillips’ allegations and Peter Strong, CEO of COSBOA told SmartCompany Phillips is “making mischief for the sake of it”.
Strong says COSBOA has received funding from the tobacco companies in the past but has not received any “direct” funding from tobacco companies since 2010.
“Tobacco companies have been sponsors in the past and a lot of our members don’t see it as being a particular problem to be honest, the Business Council of Australia has tobacco companies as members as does the Australian Chamber of Commerce and Industry,” he says.
“We get no money directly from the tobacco industry any more but it may come through members.”
COSBOA has previously lobbied against cigarette taxes and legislative changes involving cigarettes claiming they hurt small business.
Strong says Phillips has known about the tobacco funding for a long time and that it is not the real reason behind his resignation.
“Everything he said is wrong. He has been on the board for two years and he was chairman for six months and he reckons he only found out then where funding comes from and it doesn’t come from those sources,” Strong says.
“Ken Phillips’ problem is that he does not control the board at COSBOA. It is not controlled by tobacco companies, it consists of people from a whole range of organisations, accounting groups, women’s groups, retailers and small business councils.
“The fact Ken was saying he didn’t know anything about the finances of the organisation was obviously wrong any decent director would know that.”
Phillips claims he did not know about the tobacco company funding as COSBOA’s annual accounts have still not been signed off or audited.
“I’ve been on the board for two years the accounts were a mess, it took a very considerable time to find out what was going on,” he says.
This story first appeared on SmartCompany.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
