Naked CEO’s woes worsen with fake director, review

So predictable:

Rebel member Brett Stevenson said CPA’s response was a “complete whitewash” and repeated a call for Mr Malley and the remaining board members to step down, while UTS accounting professor Stephen Taylor said the board looked to be effectively overseeing a review into itself.

“How can the chairman come out and say we maintain confidence in our CEO to press on doing a great job when seven directors of a 12-member board have resigned in the past two weeks?” Mr Stevenson said.

Professor Taylor, a fellow of the CPA, said the board overseeing a review into itself “seemed a bit odd”.

“The idea that anybody involved in the existing governance would oversee a review into the governance is circular,” Professor Taylor said.

Another member, Andrew North, said today’s announcement was “absolute window dressing” and that Mr Malley should have been suspended.

“Mr Malley needs to step aside for a truly independent review to be conducted,” Mr North said.

If it was good for the banks then why not Alex Malley?

ASIC is on the move:

The directors of CPA Australia are being investigated by the corporate regulator for possibly breaching their director’s duties after allegedly misspending members’ money.

The Australian Securities and Investments Commission revealed during a Senate hearing on Friday that it first began investigating CPA back in late May, before seven of the 12-member board resigned during the last fortnight amid an escalating crisis.

However, revelations that directors are being investigated for possible breaches of the Corporations Act escalates the seriousness of the ASIC investigation with the high-profile directors now facing possible fines and bans..

“The information we are gathering relates to the duties of directors and officers of CPA Australia Limited in relation to the expenditure of money by that organisation but also around some other corporate governance issues such as relating to the annual general meeting of that particular body,” ASIC Commissioner John Price told the Senate hearing.

But the game of mates is too:

What’s left of CPA Australia’s credibility was unapologetically rammed through the shredder on Friday. Based on the form of this cabal (namely chief executive Alex Malley, his enforcers and protectors Richard Petty and Graeme Wade and their nearly octogenarian president Jim Dickson), now unfettered of independent minds, we always expected a whitewash, but this fell below even our dungeon-level expectations.

…After the Children Overboard Affair, Sir Angus Houston is no stranger to uncomfy inquiries. Maybe he even likes them. But the former ADF chief appeared on Malley’s original talk show The Bottom Line and then endorsed his book The Naked CEO in these terms: “Alex Malley is a leader that I deeply respect”. Houston’s co-panellist on this “fiercely independent” inquiry, former Commonwealth auditor-general Ian McPhee (whose former salary package CPA directors’ salaries remain linked to) sits on a sub-board of the International Federation of Accountants, as does Malley, while McPhee’s “technical adviser” is Malley’s employee at CPA, Eva Tsahuridu.

Petty is an IFAC director. McPhee also endorsed Malley’s book, mentioning that Malley once “drove a bright-orange Datsun” but not that he’d turned a once-proud organisation into the clapped-out equivalent of a 180B.

…As if the “fierce independence” of Houston and McPhee wasn’t absurd enough, the Commonwealth regulator ASIC is chaired by the hopelessly conflicted Greg Medcraft, who both endorsed Malley’s book (indeed implored young people to procure it) and stood alongside Malley to launch CPA Australia Advice, the subsidiary that now threatens CPA Australia’s registration as a professional standards body and has borrowed $12 million from CPA Australia while generating $44,000 in revenue and paying CPA Australia’s key management personnel $1 million in salaries last year.

And CPA rebels have their answer:

CPA Australia faces legal paralysis as rebel members prepare a court challenge against the board’s appointment of an “emergency director” on Friday. They claim the move is unconstitutional and warn that anything CPA decides is illegal and can be undone by the courts.

The group of long-time CPA members are meeting with Holding Redlich lawyers on Monday morning and calling on the corporate regulator to urgently intervene in the crisis.

New CPA Australia chairman Jim Dickson announced on Friday that chief executive Alex Malley would keep his job and that emergency director Tim Youngberry had been appointed to keep the organisation running.

The unilateral appointment of Mr Youngberry, a former CPA ACT divisional president, came after seven of the 12-member CPA board suddenly resigned, leaving the board short of a quorum.

Expect the media assault to double down.