Former Qantas chief executive Alan Joyce has resigned amid a flurry of negative news reports.
It comes as Qantas and Joyce faced increasingly hostile criticism of how the airline is run and the seemingly generous treatment given by both sides of government.
But while Qantas has been dominating the news headlines, is it just one more business and leadership that is failing to live up to a moral code?
There was the scandal of PwC lining its pockets at taxpayers’ expense, Optus’s spectacular data breach, News Corp’s phone hacking and Coles and Woolworths underpaying their staff to the tune of millions of dollars.
This list goes on – and let’s not forget our politicians.
Never been more distrusting
Barnaby Joyce charged the government $675,000 in expenses while a ‘drought envoy’. He never produced the final report, although apparently there was a text message.
Well, maybe that’s all come home to roost.
Roy Morgan research has found that Australians ‘have never been more distrusting’ of corporate Australia since the survey group began polling on the issue in 2017.
“The poor behaviour of many of the economy’s corporate leaders reveals a moral blindness to what is ethical and in the community’s interest rather than solely in the shareholders’ interest,” the report states.
Roy Morgan chief executive Michele Levine says this alarming increase in distrust following major scandals shows the importance of ethics in business.
“From the onset of COVID, corporate leaders had to respond with agility, often sidestepping the checks and balances. This got many of them through the pandemic recession,” she says.
Moral blindness
“But once the crisis had passed, they found the new freedoms they had enjoyed under the cover of COVID hard to relinquish, and a kind of moral blindness became endemic.
“The pandemic made it easier for leaders to look the other way, to avoid facing the ethical repercussions of their behaviour.
“Fundamentally, we need to arrest this trend and embrace a decency principle while at the same time ensuring company directors put distrust on their boards’ risk registers.”
One of the main bugbears is corporate pay.
Every time the government increases the minimum wage, corporate Australia is up in arms about how it will fundamentally harm the economy, yet their own pay continues to escalate.
According to the Australian Council of Superannuation Investors (ACSI), chief executives at Australia’s biggest companies are earning 55 times more than a typical worker.
This is a fall from 98 times adult earnings in 2021.
ACSI found CEO pay at the 100 largest listed firms averaged $5.2m in the 2022 financial year.
This is a ‘restrained’ level of pay, according to ACSI.
“It is good to see more restraint on executive pay in Australian companies over the past year, but there is still an ‘everyone wins a prize’ attitude in some parts of the market,” said Ed John, an executive manager at ACSI.
Welcome trend
Griffith Business School Professor Nick Barter told the Sydney Morning Herald the pay drop was a welcome trend.
“There may be some humility coming back where people are starting to take a more systemic perspective of businesses and realise this notion of hero CEOs doing everything themselves is nonsense,” he said.
“But also there may be some broader trends, like we are experiencing a slowdown, we’re all feeling a bit poor and, consequently, it’s a bit unsavoury and unseemly to pay CEOs excessive amounts,” he says.
Australia’s highest paid CEO is Mick Farrell, who runs ResMed, a medical supply company. Mr Farrell earns $47,138,147 a year.
Do you think there is some ‘moral blindness’ in Australia’s leadership? What would you do to curb it? Why not share your opinion in the comments section below?
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