INL Feb 15 2019 Digital Edition

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10 FEBRUARY15, 2019 Businesslink No guarantee Hayne’s Report will discipline Australian banks Andrew Linden and Warren Staples Every 10 to 15 years, it is the same. Ever since the financial deregulation in the 1980s, we have had a finance industry scandal followed by an inquiry, a quick fix, and adeclaration that it shouldn’t happen again. Scandal after Scandal In the early 1990s, there were Royal Commissions into the A$ 1.7 billion Tri-continental/ State Bank Victoria collapse, the A$ 3.1 billion State Bank of South Australia collapse and the WA Inc collapse which explored the interrelated activities at Rothwells bank, the A$ 1.8 billion collapse of Bond Corporation and the A$ 1.2 billion siphoned from Bell Resources. A decade later, in 2003, Justice Owen reported on the A$ 5.3 billion collapse of Australia’s largest insurer HIH. And now, bang on schedule, we have Kenneth Hayne delivering the final report of aRoyal Commission into systemic misconduct in banking, superannuation and financial services industry to a government that voted 26 times against holding it. Striking factors There are two particularly striking things about the 10-15 year cycle. One is the rhythm of public inquiries followed by reports, then (sometimes) trials, then books, then almost everyone forgetting (except for those personally scarred) only for problems to resurface later. The other is that the times between have been punctuated by Kenneth Hayne (Picture Courtesy: Sydney Morning Herald) government-commissioned banking and financial system reviews: the 1991 Campbell Inquiry, the 1996 Wallis Inquiry, the 2010 Cooper superannuation review and the 2012 Murray Review. Each either missed or downplayed the links between poor governance, industry structure, systemic misconduct and prudential risk. Has Kenneth got the frequency right this time? Commissioner Kenneth Hayne’s 1000-page final report has not gone far enough to end this cycle. While his referral of 24 misdeeds for possible criminal and civil prosecution will help in righting past wrongs and perhaps focus the minds of directors and executives, the impact will be generational rather than permanent. Problems with the Law The flurry of prosecutions and actions will again reveal problems with the law - gaps in coverage, inadequate penalties and cases the law won’t allow to stand up. Taken together the recommendations are a patchwork of measures that if implemented will over time be eaten away – and at some point will be dismantled – because the rationale for their adoption will be forgotten. Even before they are implemented, they will have to run the gauntlet of a massive subterranean lobbying effort from industry to water them down, something Hayne indicated he expected. The deepest flaw lies unaddressed… Even though Hayne emphasises the link between systemic misconduct, governance, structure and prudential (system-wide) risk, something that Treasury, the Reserve Bank of Australia (RBA) and Australia’s three business regulator amigos, APRA, ASIC and the ACCC, have long rejected, he makes no concrete suggestions to tackle it. Profit and misconduct As we have written previously, research tells us, big systemically important shareholder-focused universal for-profit banks that cross-sell products are more profitable than smaller banks in the good times but Essilor appoints new Sales & Marketing Manager Supplied (Edited) Content Essilor, stated to be the world’s largest supplier of prescription lenses, has announced the appointment of Kumuda Setty as its National Sales & Marketing Manager. She assumed charge last week. Impressive credentials Her responsibility includes sales and marketing of the company’s product lines, Professional Services Training and the Prescription Safety Glasses Division, along with continuing Kumuda Setty (Picture Supplied) to grow the New Zealand market. Ms Setty brings to her new assignment more than 25 years of experience in commercial roles, including eight years as New Zealand Marketing Manager at Essilor. It is understood that Essilor created the new role to support the growth of its customers in New Zealand. Ms Setty said, “Essilor’s local customer base can expect to see immediate, positive changes as the company implements a more coordinated approach to match the expectations of eyecare professionals it supplies and also provide support for their mutual growth.” Her husband Chandra Setty is the Head of Operations at Essilor New Zealand. are more prone to misconduct and to failure in the worse times. The Big Four Australia’s big four fit the bill - they’re big, they have been vertically integrated one-stop shops, they are very, very profitable and they are very focused on shareholder returns. While the banks, apart from Westpac, have divested themselves of wealth management and insurance arms for now there is nothing stopping them reacquiring them in the future. This means we are once again 10 or 15 years away from systemic misconduct resurfacing as big banks seek to become more profitable. …and putting the onus on directors won’t much help While heads might roll in yet another round of internal investigations to fix bank culture, it is wise to remember that as Adele Ferguson observed ANZ’s internal investigation of the Opes Prime collapse left the bigger governance lessons “unlearned.” ‘Charmed Lives’ continue Directors and Senior Executives of failed companies continue to live charmed lives. The Directors of Babcock and Brown were cheered as they left the building, while friends and family of the disgraced One.Tel Director Jodee Rich have resurfaced at Hayne and other public inquiries. Some of the One.Tel directors have had long corporate careers. The former chair at of the collapsed Allco Finance Group Bob Mansfield went on to review the ABC. As Adam Schwab bluntly put it, “corporate Australia is nothing if Functional Integration Essilor Australia New Zealand Chief Executive Pierre Longerna said that the Company’s new structure will allow greater cross-functional integration. “This is a very exciting time to be working in this industry and we are really pleased with our new sales team structure with Kumuda, Vineet, Guy, Bruce and Gordon who have a good understanding of the New Zealand market. They have experience in meeting the needs of our many independent optometrists and they will work closely with our New Zealand Operations team headed by Chandra Setty to ensure smooth and uninterrupted not forgiving.” It will chase horses rather than close doors Hayne is persisting with a chasing bolting horses approach to misconduct that relies on detection and enforcement. Effective governance We have argued this approach is just not as an effective as other alternatives such as two-tier boards and employee directors which have a better track record of keeping stable doors closed and horses tethered. Without them, we could very easily have another crisis and another royal commission in 15 to 15 years’ time. The Irish example Ireland has taken a been prepared to change corporate structures. After the meltdown of its financial system triggered by the end of a “classic vanilla property boom” its Parliament legislated to appoint public interest directors to the boards of its failed banks. These changes were designed to ensure banks directors put the public interest first, ahead of shareholders’ interests and even customers interests. It’s beyond time we did it here. Andrew Linden and Warren Staples are respectively Sessional Lecturer, PhD (Management) Candidate, School of Management; and Senior Lecturer in Management at RMIT University based in Melbourne, Australia. The above article, which appeared in ‘The Conversation’ (Australia) on February 5, 2019, has been reproduced here under Creative Commons Licence. service,” he said. Mr Longerna said that the new role was created to fill the gap left by a member of the senior management team. More new appointments coming “Business Manager Chris Aldous has left after an eight-year career with us to pursue a role outside of the optical industry. We thank him for his leadership and support,” he said. Essilor is expected to announce more appointments in the near future as the Company expands its marketing and sales function as well as beginning the search for a new General Manager for the New Zealand operation. IT’S YOUR CHANCE TO HAVE YOUR SAY ON OUR PROPOSED ANNUAL BUDGET 2019/2020. You’ll also be able to contribute to a discussion around how we manage water in our region. As Auckland continues to grow and change, we need to look after the waters that sustain us. Help us shape the issues we need to focus on. 19-PRO-1452 Visit akhaveyoursay.nz to find out more and tell us what you think.
FEBRUARY 15, 2019 India-Taiwan bilateral trade surges Christie Chen India’s top envoy to Taiwan touted the relationship between the two countries on Thursday at an event in Taipei to celebrate India’s 70th Republic Day. India-Taipei Association Director General Sridharan Madhusudhanan said that direct investment from Taiwan to India has increased tenfold in the last year. Major Taiwanese companies such as Foxconn, Delta Electronics Co, Wistron Corp and Century Development Corporation (CDC) are reaping benefits from their investments in India, he said. CDC, a Taiwan-based joint venture that develops industrial parks, is building a Taiwan Technology and Innovation Park in Bengaluru, he added. Updated Investment Agreement “India and Taiwan also updated a bilateral investment agreement in December 2018, and jointly established an investment facilitation office in New Delhi exclusively for Taiwanese businesses, called ‘Taiwan Plus.’ On people-to-people contacts, we see an increased flow of tourists on both sides. More Indian students are opting for Taiwan universities than before,” he said, speaking at the event organised by the India-Taipei Association. Deputy Foreign Minister Hsu OPENING JUNE 2019* Picture of Sridharan Madhusudhanan from Facebook Szu-chien said that trade and tourism between Taiwan and India increased last year. “Bilateral trade in the first 11 months of 2018 increased by 12.5% from the previous year, while the number of tourists visiting Taiwan from India during that period grew by about 11% from the same period in 2017,” he said. Successful New Southbound Policy Mr Hsu said that the ‘New Southbound Policy’ launched by President Tsai Ing-wen’s administration sees India as one of Taiwan’s most important partners. Taiwan’s government is helping to develop the Taiwan Technology and Innovation Park in Bengaluru, he said, adding that the Park is expected to be the first industrial cluster for Taiwanese businesses in India and could facilitate further investment in the country. Report Courtesy: Taiwan-Asia Exchange Foundation, Taipei, Taiwan Tenancy laws can be tough and variant Khushbu Sundarji Before you occupy any commercial premises, you should enter into a Deed of Lease (“Lease”) with the Landlord. As a Tenant, you will have the right to occupy the premises owned by the Landlord as long as you abide by the terms of the Lease. Here are some items that you should look at before you sign the Lease: Rent and Outgoings The main obligation of a Tenant is to pay the rent and outgoings to the Landlord. You should check to see if the rent is appropriate for the premises. If you are unsure, you can talk to a property valuer or an accountant before you sign the Lease. The Landlord will also advise the outgoings that it charges for the premises. The outgoings can include items such as the costs of maintaining the premises, rates, water and other utilities. You should ask the Landlord for an estimate and a schedule of the outgoings. Permitted Use of Premises The Lease will state the permitted use of the premises and the use will be agreed between the parties prior to the Lease being executed. If you wish to amend the use, you must seek the consent of the Landlord in writing. In the event you change the permitted use without seeking the consent of the Landlord, this will be considered a breach of the Lease by the Landlord. Property and your assets The Lease should specify any Businesslink FOOD OUTLETS WANTED This award-winning development is looking for food outlets to open in Sugartree Lane, a convenient pedestrian lane linking Union and Nelson Streets in Auckland’s central city. Surrounded by outdoor garden areas with courtyard or city views, Sugartree Lane has a range of spaces to perfectly fit the size of your restaurant or takeaway business. By the end of 2019 over 10,000 people will live or work close to Sugartree Lane so come in and discuss the possibilities your new food business today. DON’T MISS OUT, CONTACT US TODAY TO VIEW. Julie Warbrick chattels or items that are owned by the Landlord and tenant respectively. If you are installing items in the premises, make sure that the Lease reflects that you own those assets. If you are unsure if any item is owned by the Landlord, it is best to ask the Landlord as soon as possible as you will be responsible for all maintenance relating to your assets. Tenant’s obligations You have various obligations under the Lease. These include payment of all rent, outgoings and any other payments due to the Landlord, maintaining and repairing the premises if necessary including care of grounds if you are leasing the whole property. Landlord’s obligations The Landlord also has obligations under the Lease. These include drafting and issuing the Lease and any Deed of Rent Review and renewal, specifying the terms of their insurance for the premises, maintaining the premises and repair any structural defects if necessary and ensuring that the Premises has a Building Warrant of Fitness. Termination and vacation The events that can lead to the Landlord terminating your Lease include non-payment of rent or outgoings, breaching any other term of the Lease or attempting to assign the Lease without Landlord’s consent. Termination of the Lease by the Landlord does not stop your obligation to pay any amounts owed to the Landlord. Prior to vacating the premises, you must pay all outstanding rent and outgoings, and any other payment due to the Landlord. You will also need to remove all of your property from the Premises and restore the premises 022 639 3028 | julie@sugartree.co.nz SUGARTREELANE.CO.NZ 11 Image Courtesy: www.safetysign.com to the condition it was as at the commencement of the lease. This includes fixing any damage caused during the term of the Lease or damage caused when you removed property from the premises. This will not apply to any damage that has occurred during the lease term that is ‘fair wear and tear’, that is, use that occurred from normal use of the premises over the term of your Lease. Understanding the Deed A Deed of Lease is a legally binding contract which sets out the terms of the relationship between you and the Landlord, so it is essential that you understand what your rights and obligations are under the Lease before you sign it. If you have any queries or are unsure about any terms of the Lease, you should aqualified legal professional. Khushbu Sundarji is an Associate at Stewart Germann Law Office. Phone: (09) 3089925 Email: khushbu@germann.co.nz; Website: www.germann.co.nz Legal Disclaimer: The above article should be considered only a general guideline and not as specific advice. Indian Newslink and its Management, Stewart Germann Law Office and Khushbu Sundarji absolve themselves of all obligations in this connection. Please consult your lawyer and/or accountant before taking up any business mentioned in the above article. * PROJECTED COMPLETION DATE
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