WOKE WEDNESDAY: Qantas glass cliff siren, Elon headline roundup, and Aubrey Capital's ESG clickbait op-ed is idiotic? (question mark)

Live from Tariq Fancy’s Anti-ESG diary, it’s the ESG Industry’s ONLY weekly woke data podcast, featuring AnalystHole Matt Moscardi! In today’s sweaty september ESG sack called September 6, 2023: An Epic Australian Glass Cliff Alert, All the Musk Headlines you were trying to avoid, the ESG Idiot of the Day, and the great Paul Hodgson from ESGauge

Our show today is being sponsored by ESGauge, your ESG data solutions provider: Paul will jump on later to talk about “women on boards and women in management”

DAMION1

1. Glass Cliff Alert: Vanessa Hudson, the incoming Qantas CEO, faces big challenges in the years ahead. Maybe best to tell this story with a hodgepodge of horrible headlines:

1. Qantas CEO Alan Joyce to Step Down Two Months Early

1. Joyce’s unexpected departure after 15 years at the helm is an extraordinary concession, just weeks before a planned formal farewell at the airline’s annual general meeting.

2. Qantas’ CEO was flying high on notching record profits after COVID. Then a bogus ticket scandal sent him into early retirement

1. Any high that Qantas was still riding after announcing a record $2.47bn profit seven days earlier came crashing down on Thursday morning, when the Australian Competition and Consumer Commission (ACCC) dropped its bombshell.

2. The watchdog had been investigating Qantas’s cancellations and had decided to take the airline to court. It alleged the airline had engaged in false, misleading or deceptive conduct in advertising and selling tickets for more than 8,000 flights between May and July 2022 that had already cancelled in its system. Put simply, the allegation was it sold seats on planes that were never going to fly.

3. Consumer watchdog aiming for record $600m penalty against Qantas

1. Qantas has been accused of breaking consumer law by allegedly advertising tickets for thousands of cancelled flights and failing to tell customers about ticket cancellations.

3. Qantas' reputation is in the bin. What can new CEO Vanessa Hudson do to retrieve it?

4. Qantas issues a grovelling apology to Australians after nightmare week

1. “We openly acknowledge that our service standards fell well short and we sincerely apologise.”

2. Qantas' bad week was topped off on Friday when it was revealed chief executive Alan Joyce was granted $10.8m in shares for bonuses deferred during the pandemic - all the while Qantas maintained it had no obligation to pay back the $2.7bn in government payments it received during Covid-19.

5. Alan Joyce leaves Qantas: Outrage over $24million CEO's golden handshake as he retires to enjoy a penthouse with views of the Sydney Opera House

1. Some house shaming:

1. On top of that Mr Joyce in June sold his palatial home in the exclusive Sydney suburb of Mosman for a price rumoured to be well above $20million, having shelled out $19million for it early last year with husband Shane Lloyd. 

2. The couple will not be cast out on the street however, as they have 'downsized' to a $9.25million penthouse bought earlier this year and next to one they already own at the Cove Apartments in Sydney's harbourside The Rocks district.

3. To fill up any idle hours of Mr Joyce's retirement at age 57 the pair can also retreat to their weekender at Sydney's glamorous Palm Beach, which cost $5.25million in 2015. 

6. ‘Everybody has a Qantas horror story’: run of negative headlines brings Flying Kangaroo down to earth

1. Qantas has been the subject of scandal under Joyce's leadership and was found to have violated the Fair Work Act in 2020 by Australia's Federal Court. 

2. The court ruled that the airline had illegally fired 1,683 employees in the process of outsourcing 2,000 ground handling jobs.

1. Qantas loses appeal on 'illegally' outsourcing jobs, with compensation and penalties awaiting

2. Qantas axed 2,000 ground-handling jobs partly because of union ties, court rules

7. Qantas board under fire over horror run

1. Shareholders, their proxy advisers and governance experts are questioning the actions of the Qantas board led by veteran chairman Richard Goyder after the surprise early exit of former Qantas boss Alan Joyce on Tuesday.

2. Senior company figures indicated on Tuesday that the board was not expecting Joyce to retire early and was also unaware of the severity of the Australian Competition and Consumer Commission’s case against the airline group until it was disclosed to the market last Thursday.

3. Qantas chairman Richard Goyder emphasised that it wasn’t the Qantas board’s decision for Joyce to leave early; it was Joyce’s own decision, even though “it goes against every one of his instincts”.

4. Goyder is not up for re-election at November’s annual general meeting as his term was extended for a three-year period in 2022. He does have the option to put himself up for re-election, but is not expected to do so.

1. He is Chair of the Nominations Committee.

2. Mr Goyder is Chairman of Woodside Energy Group Ltd, the Australian Football League Commission, the West Australian Symphony Orchestra, and of the Channel 7 Telethon Trust.

5. Dr. Heather Smith (PhD in Economics) appointed to the board two weeks ago

1. Dr Smith has close to 20 years’ experience working in the Australian Public Service at senior levels culminating in being Secretary of the Department of Industry, Innovation and Science from 2017 to 2020. She has also previously served as Secretary of the Department of Communications and the Arts.

2. Dr Smith has also held senior positions in the departments of Prime Minister and Cabinet, Foreign Affairs and Trade, and the Treasury, as well as the Office of National Intelligence. Dr Smith began her career at the Reserve Bank of Australia.

6. Michael L’Estrange is stepping down in November

1. As of AGM: majority female board, including the CEO: 5/3

8. Qantas boss Alan Joyce invites Anthony Albanese’s 23-year-old son to elite Chairman’s Lounge

1. The Prime Minister’s son, a 23-year-old university student, has been deemed worthy of a spot in “most exclusive club in the country”

1. AFR Rear Window columnist Joe Aston described the gift as “the stuff tinpot African republics are made of”.

1. “But did any of them really think a university student sweeping into the Chairman’s Lounge like a lord wouldn’t stand out like dog’s balls?” Australian FInancial Review

9. And then inevitably: Qantas’ woke capitalism is failing

1. Mostly at issue: Qantas has formally declared its support for an Indigenous Voice to parliament

1. Qantas was one of many big companies that called for constitutional recognition of First Nations people in 2014

2. Referendum is in October 2023: asking voters whether they support altering the constitution to set up an Indigenous committee to advise the federal parliament.

3. “The central conundrum of Woke Capitalism is its unprofitability. Consumers often hate it. Heavily politicised, it can alienate half a company’s potential customer base – which is a bad move. Not to mention there is zero evidence that Woke diversity training programs improve productivity (there is evidence that suggests the opposite is the case). Woke employees are likely to spend lots of their time on social media or having histrionic tantrums over ‘microaggressions’ created by their colleagues. They do this rather than actually working.”

1. Qantas delivers record $2.47bn profit on back of soaring demand and high ticket prices

2. Elon Musk headlines

1. Musk Blames Anti-Defamation League For X’s Poor Ad Sales, Threatens Lawsuit

1. The head of the Anti-Defamation League says Elon Musk's behavior is 'dangerous and deeply irresponsible' after he threatened to sue the non-profit

2. Musk’s Epic, Antic Labor Day Weekend Against The Jews

2. Elon Musk borrowed $1 billion from SpaceX around the same time he bought Twitter

1. Elon Musk Categorically Denies SEC & DOJ Investigation Claims That He Misappropriated Tesla Funds To Build a Glass House

3. A Tesla bumper sticker that says 'I bought this before we knew Elon was crazy' keeps popping up on social media. It's prompting a debate about whether you can separate a product from its CEO.

4. Elon Musk says progressive LA school has turned daughter into 'communist' who thinks 'anyone rich is evil

1. Elon Musk says his daughter who ditched his last name 'doesn't want to spend time with me'

5. Elon Musk's erosion of safety standards at X is helping Putin spread Russian propaganda, study finds

6. Elon Musk has unprecedented influence that spans multiple industries — and our fate is in his hands

1. Elon Musk's X wants to collect users' biometric data and education history, an upcoming privacy policy update shows

2. Federal officials claim Elon Musk is treated like an ‘unelected official’ due to growing influence in Ukraine war policy, report says

7. Elon Musk doubted ex-Twitter CEO Parag Agrawal because he was too nice

8. Elon Musk's X is hit with 2,200 arbitration claims from former Twitter employees

9. Tesla investors awarded $12,000 each for Elon Musk's 'funding secured' tweet falsely indicating he would take the company private

10. Elon Musk's tweet is cited in a new DOJ lawsuit accusing SpaceX of routine discrimination against refugees

11. Elon Musk's Tesla almost ran a red light during a FSD demo: A video appeared to show Musk taking the wheel after the software misread a traffic signal. 

MATT1

ESG Idiot of the Day?

• Has ESG Gone Off the Rails? - Wealth Management

• Written by Sharon Bentley-Hamlyn, Aubrey Capital Management

• Opera singer in the 1980s

• Credit Commercial de France M&A analyst

• Walter Scott Partners analyst doing EU stock selection

• Won some women stuff 

• Quotes:

• The Airquotes ESG Play: I am becoming increasingly queasy about the direction of so-called ESG.

• The “We Do Women Good, But They’re So Hard to Find” Play: Our firm strongly supports getting more women to consider investment management as a career, and we have a good gender balance in our company. But there are several well-run businesses in our investment universe that are downgraded in the sustainability ratings because women do not yet comprise one-third of their boards. In principle, it would be great to have this level of female participation, assuming women can be found who are qualified and competent for board roles. But in our experience of speaking with senior management in a wide range of industries, this is not so easy to achieve. There simply are not enough qualified women coming forward for such roles, or indeed, entering certain industries and progressing to this level. 

• The Ideology Discrimination Play: You get into situations, as in the UK, where basic services, like banking, can be denied to individuals, small businesses and organizations whose views may not concur with a company’s political or sociological stance.

• Airquotes ESG

• Aubrey built their ESG practice in 2006 and used the UN Global Compact.  That is all.  That is all the information they give you.  They do their own in house research, which means they have no context for anything outside of their portfolio.

• They claim, “internal know-how to create ESG scores for the companies in our portfolios”

• ESG experience includes Klyzza Lidman (ESG investing certificate), junior analyst 

• Camilla Huang (ESG CFA course), junior analyst

• ONLY THE WOMEN HAVE ESG EXPERIENCE IN THEIR BIOS, and all are junior

• Tariq Fancy was right?????

• We Do Women Good

• 22 men out of 31 employees on website

• 100% male portfolio managers

• 88% male investment managers

• 80% male investment teams

• 63% male ops team 

• 71% male sales team

• 78% male board - they can’t even get 30% themselves!

• Sharon on a podcast on women in investment management: Aggressive culture keeps women out, maternity leave means men advanced ahead of them, job satisfaction/work life balance matter more to women (who get paid less), gender washing through mixed team without giving women responsibility, allocation bias where clients give less to women.  No difference between women and men on research, but confidence is an issue, networking is an issue because women don’t do “drinking culture” (probably the groping is a problem)

• The Ideology Discrimination

• Nigel Farage???  Really?  

• See, the point here is pretty simple - if you give everyone a pen on the internet, you can flood it with idiot hot takes, zero data, and clickbaity titles to feed a narrative about ESG data that has nothing to do with data.  Tariq can just say everyone in ESG data is “underqualified”, Vivek can say ESG is destroying capitalism, and I can get in a back in forth on LinkedIn with a guy who says ESG is now responsible for “predatory delay” in dealing with climate change.  Data used by these people?  Zero.  Zero data.