FIRB chairman Brian Wilson must resign for the good of his country

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As I noted yesterday, from The Australian:

Foreign Investment Review Board chairman Brian Wilson has accepted a role as adviser to the $180 billion private equity giant, the Carlyle Group, potentially putting the former investment banker in conflict when it comes to giving the green light or blocking key foreign investment moves.

The US-listed, Washington-based private equity group, which has completed more than $2bn worth of deals in Australia and more than $20bn worth in Asia, yesterday said Mr Wilson would become a senior adviser to its Asian buyout team.

However, Mr Wilson, who plans to remain in his current role at FIRB, has promised to stand aside from any decision involving Carlyle, the private equity fund that has a string of investments in Australia and through Asia.

…The Sydney-based Mr Wilson will be working with Carlyle’s Asian buyout team looking for new investment opportunities in Australia and the region.

…Scott Morrison said FIRB had “strong procedures in place to manage conflict”.

For Mr Wilson to have no conflict he will have to stand aside on every single FIRB decision, given all of them will potentially give Carlyle the inside run on what competitors are doing. And what, is he never going to talk to his staff?

He may not intend it, but this is a bald-faced corruption of Australia’s primary foreign investment entity, a body that will come under intense scrutiny in the years ahead as anti-globalisation pressures spread.

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Brian Wilson must resign or drop the job with Carlyle. It cannot be both.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.