Qantas, PwC, Rio Tinto, Crown, the banks: There’s something rotten at the big end of town
Bernard Keane and Glenn Dyer argue that Qantas is the latest indicator of the rot at the soul of Australian businesses.
September 8, 2023
This week, big business wanted you to be talking about industrial relations — about Tony Burke’s attempt to regulate the gig economy, criminalise wage theft, impose the socialist doctrine of equal work for equal pay across industries that rely heavily on using contractors. The ads were rolled out, the Australian Financial Review op-eds and hysterical attacks were readied, the interview slots were booked.
But all anyone is discussing is Alan Joyce and Qantas, now the symbol of corporate greed in Australia.
For a man who revelled in his reputation as an industrial relations warrior, complete with the illegal sacking of thousands of workers during the pandemic, it’s another of the many ironies of the way his victory lap has been brought to an unceremonious end.
Qantas is now the fifth major example of a company that arrogantly believed its importance, its political influence, its media manipulation skills and its ability to evade regulation made it untouchable, allowing it to treat its customers, workers and community with contempt, without consequence.
The big banks, their financial service and insurance arms and AMP — comfortably backed by their massive donations and entrenched support within the Liberal Party, media support, and the limp non-regulation of an underfunded ASIC — thought they could do no wrong. They stole from customers (including dead ones), flogged garbage products and immiserated hundreds of thousands of people. It wasn’t until their behaviour grew so egregious that a community backlash forced politicians to act, exposing their crimes at the Hayne royal commission and pushing a herd of CEOs, chairs and directors out, forcing them to abandon wealth management.
Crown and Star were protected by their political mates on both sides of politics to whom they donated generously, were unthreatened by toothless regulators and presided over money laundering, links with organised crime, and systemic exploitation of problem gamblers. It took the media and an independent, powerful regulator in AUSTRC to bring them undone. The same scenes followed — painful appearances at inquiries, a rush for the exits by executives and directors, governments forced to take action.
And again with Rio Tinto, the mining giant used to getting its way with governments and regulators and feted by the media, until it thought itself so immune from criticism that it could deliberately destroy one of the country’s most important archaeological sites with complete indifference to the opposition of traditional owners. Cue inquiries, sacked executives, and international opprobrium.
Next, the big audit and consulting firms. Rinse, repeat. Big political donors. Well-connected politically. Little or no regulation, especially in consulting, while the firms made billions from deeply conflicted roles selling garbage to governments and top-quality tax avoidance advice to those who could afford it — including leaked information from within the government. PwC lost much of its top brass in the ensuing turmoil and abandoned consulting.
Now it’s Qantas. The only different detail is that Qantas didn’t need to make donations. It has the Chairman’s Lounge, and the vestigial delusion that it’s Australia’s national carrier rather than a national disgrace. Joyce thought he was untouchable, that no amount of anti-competitive conduct, insults of his passengers, attacks on his own workforce, or grabbing of taxpayer funding would ever come back to haunt him. He was nearly right, but at the death knell, another independent regulator, unfettered by supine politicians, went for his throat.
Now we wait to see when chair Richard Goyder is forced out. And what did new CEO Vanessa Hudson know about the fake flights scandal, and when did she know it?
The recurring theme here is that of Australia’s biggest companies investing more into duchessing politicians, thwarting regulators and cultivating the media in order to allow them to operate without accountability than in innovating, increasing productivity or becoming globally competitive. The only best practice about these companies is their ability to exploit the soft corruption of our political system, cue up compliant journalists and editors, and game what passes for the regulatory system here.
These aren’t outliers, but symbols of a wider malaise. The fossil fuel industry benefits from a political protection racket that the big banks and the casinos can only dream of — including being asked how much tax they’d like to pay — and have a phalanx of journalists across the media to guard their interests. The defence manufacturing industry has an entire security establishment, aided by hysterical Sinophobic journalists, working hand-in-glove with them, aided by the self-serving cloak of national security, while delivering multibillion-dollar projects wildly over budget and massively delayed. The big media companies, which face minimal regulation and virtually no anti-competitive constraints, can order governments to crush competitors.
The language of big business — amplified and echoed by mainstream media companies and the Reserve Bank — is that Australia’s “productivity crisis” is a problem of workers and governments: workers need to be more “flexible” and accept lower wages; governments need to get out of the way — eliminate industrial relations regulation, remove environmental and planning laws, reduce taxes (at least on business, increasing them on low-income earners is fine).
The emphasis on workers (and the demonisation of unions, which have just a 12% share of the workforce), ignores the quality of employers and management and their capacity for innovation; the debate tends to focus on labour productivity, not multifactor productivity, including capital and its productive use.
And when it comes to government, the big four banks, and Star and Crown, Rio Tinto and PwC, EY, Deloitte and KPMG, and Qantas seemed to all like government exactly as it was, thanks very much: supine, supportive and ready to lend a hand whenever it could.
The fossil fuel companies, arms manufacturers, the media, and other concentrated industries like the supermarket duopoly and energy industry all continue to enjoy those benign conditions.
The only risk is if, in their hubris, they go down the path of Alan Joyce, big bank CEOs, PwC partners, and myriad casino executives and staff, and ruin it all.
This article was first published by Crikey.
