www.businessreviewaustralia.com | December 2010
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BY michaela mcnamara
Looking Back on 2010
As another year comes to a close, we look back and highlight some of the greatest business success stories that have come out of Australia in 2010. Between ANZ Bank’s record annual profits to CSL’s invaluable H1N1 vaccine, the companies profiled have seen positive developments this year. We also discuss another 2010 hot topic—cloud computing. Businesses across the nation saw major a shift “into the cloud,” and began many processing many internal and external activities over the Internet. Cameron McNaught of Fujitsu Australia discusses why. We’ve also partnered with some marketing and finance gurus from the University of New South Wales’ Australian School of Business, who offer fresh insight into luxury brand survival strategies—just in time for the holiday shopping season. When you’re finished reading the December issue of Business Review Australia, kick your feet up with a holiday libation and enjoy the end of 2010.
Michaela McNamara Editor-in-chief
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december
10 News
Business Travel
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38 Marketing
FEATURES 10 News The latest news and analysis from the past month 14 Business Travel Spotlight on Singapore 16 Social Media Top 5 Ways Your Workplace Could Embrace Social Media 18 Business Celebrities Hugh Jackman 20 Innovation Laundy Hotels Implements New Racing Industry Innovation 22 Business Leaders Australia’s Industry Leaders: 2010 Edition 28 Money Matters Boardroom Positions Vacant 34 Technology Cloud Computing - Transforming IT 40 Marketing Luxury Brand Survival Strategies 46 Events & Tradeshows Up and coming events for your diary
ASSOCIATION profiles 48 ACWA 52 ALPGA www.businessreviewaustralia.com December 2010
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december
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St. John of God
Queensland Nickel
174
122
Bardot
Energy 56 Queensland Nickel New owner shows Queensland Nickel the way 68 Schneider Electric NZ Improving Energy Efficiency in New Zealand 74 Drilling & Grouting Services Targeting a diverse market in Western Australia 80 Fullcircle Recycling Fullcircle Recycling Flattens the Competition 88 Airdrill Airdrill’s Experts Know The Drill, Creating Sector-Specific Solutions 94 Northern Star Resources A Rapidly Emerging Australian Gold Producer & Explorer 102 Ramelius Resources Profitable Gold Exploration at Australia’s Mt. Magnet 108 Gull Group Championing Sustainability in Australia and New Zealand 116 Solco Your choice for Sustainable Energy 8
December 2010 www.businessreviewaustralia.com
healthcare 122 St. John of God Healthcare Healthcare On the Right Mission from St John of God... 146 Helping Hand Aged Care Leaders in Service Innovation 156 Sydney Adventist Hospital Body, Mind and Spirit 168 Dental Health Services Victoria Leaders in offering dental health services for people...
retail 174 Bardot Bardot Designs Take on International Audiences 186 Retail Adventures Simplifying the Community Brand 212 The Motorama Group Queensland icon & Brisbane’s best car dealer for over 50 years 220 Super A- Mart From Local to National How Super A-Mart manages... 230 Gordon & Gotch Gordon and Gotch brings superiority to the print industry 240 Cygnet Bay Pearls In the heart of the Kimberley, Cygnet Bay Pearl Farm is the place...
Construction 246 Schiavello Group Schiavello Building Strong Client Foundations on Experience... 252 Building Education Revolution Best Practice Schools Projects in... 258 Kempsey Bypass Kempsey Bypass, Upgrading the Pacific Highway 264 Tiger Brennan Drive Extension Largest infrastructure in Northern Territory... 272 Gawler Gawler Line Revitalisation Project On Track in Adelaide 282 Manukau Motorway Link Leighton Works Delivers Manukau Motorway... 288 Tagara Growth Through Values, Service and Technology
supply chain 296 Fremantle Ports The Ships Are Getting Bigger 310 Harbourside Coldstores Harbourside Coldstores reinvents itself 316 Oceanbridge Shipping A Premier Global Partner For Air & Sea Transport 322 Pearl Aviation Pearl Aviation reaches new heights 328 El Zorro Transport The Fox Gets on Track
manufacturing 334 Dytecna Asia Pacific Providing Engineering Solutions to Australia’s Defence Industry
food & drink 340 Windsor Farm Foods Windsor Farm Cooks Up Innovative Food Industry Ideas www.businessreviewaustralia.com December 2010
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FOR THE LATEST australia NEWS Visit Website
Still Not Enough Women in Australian Boardrooms New research released by the Equal Opportunity for Women in the Workplace Agency (EOWA) has revealed that there are only five female chairs and six female CEOs in the top 200 Australian companies. The EOWA 2010 Australian Census of Women in Leadership, conducted by Macquarie University, shows that women hold only 8.4 percent of board positions and 8 percent of Executive Key Management Personnel positions. Compared with New Zealand, UK, Canada, US and South Africa, Australia has the lowest percentages of women in the most senior positions.
Virgin Blue’s “Severe Interruption” Cost Up to $20 Million Following the crash of its reservations system on September 26, Virgin Blue estimates that the impact will cost between A$15$20 million. The outage, which lasted eleven days, resulted in a “severe interruption” of Virgin’s Blue business, the airline said. The Navitaire/Accenture reservation system that went out disrupted reservations and check-in and related operating systems. The system came back online on October 6, but during the eleven day outage, Virgin Blue employees performed check-ins manually, prompting flight delays and cancellations. 10
Depressed Employees Costing Economy $730 Million a Year Attention, all employers! Your depressed workers are costing the country $730 million a year. According to a repor t by the University of Melbourne and V i c H e a lth , exc e s sive pressure at work is costing Australia’s economy
December 2010 www.businessreviewaustralia.com
hundreds of millions of dollars due to job-stress related depression. The excessive job strain price tag includes lost productive time, employee replacement costs, government-subsidized mental health services and medications for depression. It equates to $ 11. 8 b i l l i o n over the average working lifetime, with the biggest loss accruing to employers.
australia
BUSINESS NEWS
Commercial-Scale Smart Grid Coming to Sydney Australia is one step closer to improving its energy efficiency. A consortium, including IBM, GE Energy Australia, AGL, Sydney Water, Hunter Water and Newcastle City Council, will develop Australia’s first smart grid network. IBM’s role is to perform systems integration for the $100 million Smart Grid, Smart City initiative. Under the agreement with EnergyAustralia, IBM will build on its existing work on EnergyAustralia’s Smart Grid Program, to deliver distributed generation, smart metering and demand management solutions. The three-year project has begun across five sites in Sydney and the Hunter region
OktoKopter Ready to Fly for Climate Change A new, mini high-tech remote controlled helicopter aptly named the “OktoKopter” will map fragile coastal moss beds in Antarctica in 2011. Developed by climate change scientists at the University of Tasmania and Australian Antarctic Division, the eight rotor helicopter, equipped with cameras and sensors will sweep the Antarctic skies. The remote controlled machine, about 20 times smaller than a real helicopter, will use remote sensing techniques to monitor the impact of changes in temperature, wind speed and UV-B radiation on moss beds at Casey station.
NEWS IN BRIEF Walmart Eyes Global Expansion into China, Mexico Walmart revealed its plans for global expansion, saying that it expects to add approximately 32.5 million square feet globally in the fiscal year ending January 31, 2011.
Gorgon Workers to be entertained by TV, Web, Video Games UXC will install an entertainment system for the Construction Village at the Chevron-operated Gorgon Project. UXC said that the multimillion dollar contract, awarded by contractor Kentz Pty. Ltd., will provide video-on-demand, television, video gaming system, internet, radio and an outdoor movie theatre delivered on an IP network.
Starbucks Gets Greener with Sustainable WoJo Textile New Zealand-based design company The Formary has been selected by Starbucks to supply a natural and sustainable new textile to cover seating in its locations. The fabric, called WoJo, is created using a unique, upcycling process with Starbucks coffee sacks and wool.
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NEWS IN BRIEF Marengo Inks MOU with Chinese NFC for Yandera Project Marengo Mining is a step closer to financing and constructing its 100 percent-owned Yandera Copper-Molybdenum-Gold Project in Papua New Guinea by signing a Memorandum of Understanding with Chinese construction and engineering group China Nonferrous Metal Industry’s Foreign Engineering and Construction Co.
Indigenous Australians Take over Ayers Rock Resort The Indigenous Land Corporation (ILC) has purchased tourist icon Ayers Rock Resort at Yulara for A$300 million, including all hotels and accommodation, associated infrastructure, the airport and workers village.
Google Tops Australia’s Most Popular List of Websites According to Nielsen, 12.7 million Australians log on to Google each month making it the most visited website in the nation. Microsoft came in at a close second with 11.4 unique users every month.
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Carmaker Holden Unlocks the Doors to New Cruze Facility
The doors have officially opened for car manufacturer Holden’s new multimillion dollar Cruze small car facility at its Vehicle Operations in Adelaide. The plant manufactures the roof, body sides, closures, fascias and majority of interior plastics for the four-cylinder Cruze vehicles, while bodies will be produced in the South Bodyshop before leaving to join Holden’s line of Commodore vehicles on the line in General Assembly. Within the South Bodyshop 22 new robots and 4 8 r ef ur b i s h e d robots have been installed in the fullyfunctioning layered build line.
Skype Gets a Makeover and a New Partner in Facebook Skype has gotten a major makeover with the launch of its new Skype for Windows, which integrates Facebook News Feed and a new group video calling feature. Skype says the rejuvenated look and feel
December 2010 www.businessreviewaustralia.com
makes voice and video calling, instant messaging, screen sharing, file sharing and more, intuitive and easy to navigate. The Facebook integration makes Skype even more social. For the first time Skype users can “lift” their interactions with their Facebook News Feed, including posting status updates, commenting, and liking, directly from Skype.
australia
BUSINESS NEWS
What Does Gail Kelly Have in Common with Lady Gaga? Australia’s very own Gail Kelly has joined the ranks of Oprah Winfrey and Lady Gaga on Forbes magazine’s list of the world’s ten most powerful women. The 54-year-old Kelly, who ranked eighth on the list, is head of Westpac, one of Australia’s largest banks. As the Chief Executive, she has banked $551 billion assets and $15.9 billion in revenue. In its profile on Kelly, Forbes said, “Kelly’s every statement and opinion--public or otherwise--is reported minutely, occasionally provoking national controversy. Since late 2009 Kelly has earned the ire of everyday Australians by drastically raising interest rates on loans.”
Radical! Billabong Buys 38 Stores from General Pants
Surfwear company Billabong acquired 38 Dive ‘n’ Ski and (SDS) Jetty Surf retail stores, along with two licensed Billabong stores, from the General Pants Group for an undisclosed amount. The newly acquired business is expected to contribute approximately three percent of Billabong Group revenue in the 2010-11 financial year. Billabong chief executive officer Derek O’Neill said the acquisition brought together two businesses with a strong heritage in the surf and wider boardsports sector. “SDS was one of Billabong’s earliest retail customers so we have had a strong working relationship over many decades,” said O’Neill.
Racy Calvin Klein Billboards Removed in Melbourne
In a long tradition of controversial advertising tactics, Calvin Klein has once again been asked to take down its racy billboards around Sydney and Melbourne. The Adver tising Standards Bureau asked
the global fashion brand to pull the advertisements following complaints that the suggestive images, depicting a scantily clad young woman surrounded by similarly exposed young men pulling her hair and straddling her, invoke rape and violence against women. According to the Herald Sun, the Advertising Standards Bureau received over 50 complaints about the ads.
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michaela mcnamara
Spotlight on
Singapore Known for its cleanliness, organization and order, Singapore is also one of Southeast Asia’s cultural hotspots. Inside the nearlyspotless city, you’ll find upscale restaurants, accommodations & shopping Marina Bay Sands Hotel Where to Dine: Located in the Historic District, Restaurant FiftyThree offers an innovative combination of local and French cuisine from world-renowned chef and Singapore native Michael Han. Though the dinner menu is mandatory seven-course, you can find such dishes as Potato and Duckweed over Coffee and Parmesan. Bon appétit! 53 Armenian St.
two theaters, six “celebrity chef” restaurants, and much more, the Marina Bay Sands is almost a city unto itself. The mega-hotel opened in June 2010, featuring three 55-storey hotel towers that are connected by a one-hectare sky terrace on the roof, named Sands SkyPark. 10 Bayfront Ave.
Where to Shop: Orchard Road is the go-to place for luxury shopping. From Where to Stay: The Marina Bay Sands fine jewelry shops to trendy Asian fashion Hotel is not for the faint of heart. With over boutiques, there are plenty of stores for big 2,500 rooms and suites, a world-class casino, spenders. Stylish execs should head to 14
December 2010 www.businessreviewaustralia.com
Business Travel
Singapore Botanic Gardens Justmen’s—a celebrated tailor that’s popular with the expatriate crowd. Between the shop’s fine fabrics and expert tailoring, you may just find your new favorite suit here. Tanglin Shopping Centre, Orchard Rd. When You’re Out of the Conference Room: SooBin Art International is a superb gallery to check out contemporary art from artists in the region. Located in the MICA Building, SooBin has featured world-class exhibitions by Yue Minjun, Zhang Xiaogang, Lee Man
Fong and Chen Wen His. SooBin has been appointed by Christie’s, Sotheby’s of Hong Kong and China Guardian of Beijing as their representative in Singapore. 140 Hill St. Also check out the Singapore Botanic Gardens, where you will find manicured gardens, Victorian ga zebos, stunning orchids and a mini rainforest. The 157-acre park READ MY is popular with locals who BLOGS Visit practice yoga and martial Website arts here. Corner of Cluny Rd. and Holland Rd.
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Tomer Garzberg
Top 5 Ways Your Workplace Could
Embrace Social Media
“Really? Social Media? How could there possibly be any value whatsoever to my business?” If that sounds like you, read on. Firstly, it’s important to realize what Social Media really is. The inner critic in all of us is resistant to change. Change makes many feel uncomfortable. Couple that with the unpredictability of Social Networking, and you have a nice case for the old block via firewall mechanism. Is Social really your enemy? Just like in the real world, making a fool of yourself is likely to be social suicide – the same goes for online. How can you actually embrace Social as a tool to perhaps even drive new business? Here’s the Top 5 Ways Your Workplace Could Embrace Social Media: 16
1. Surveillance: What better way to satisfy the Facebook and Twitter related itches of your employees than to get them to perform surveillance tasks? Set aside a few minutes a day where everyone gets Googling/ Facebooking/Twittering, looking for mentions of your company, interesting industry tidbits, and prospective new business. 2. Brand Mentions: Using the collective access of your employees, you can instantly increase the reach of your message. Get them all to Tweet/Facebook a message to the world about your company, or your new blog, or some new promotion and instantly increase
December 2010 www.businessreviewaustralia.com
Social Media
http://www.strongmandigital.com.au/category/blog/
the exposure of your brand. Step and Repeat. 3. Competitor Tracking: There’s nothing like healthy competition. Get your employees to check out what the competitor is up to online and have them all report back to you. You’d be surprised what you dig up and the potential opportunities that may appear. 4. Marketing Research: Ask each of your employees to find 3 of the most engaging Facebook brands, YouTube brands and Twitter brands and have them report them back to you. It’s a great excuse to get something productive out of YouTube at least! 5. Viral Recruitment: The best part
about Social Networking is the networking aspect itself. If your employees are going to be actively updating their statuses, you might as well allow them to say something like “Like our BRAND for an exclusive discount” or something along those lines. Why? Friends listen to friends. Tomer Garzberg is the director of Strongman Digital Media. He has presented in front of groups of over READ MY 1000 CEOs, to small groups BLOGS business owners, at Corporate, Visit Government, and Non-Profit Website Organizations.
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michaela mcnamara
hugh Jackman Whether he’s playing Wolverine in blockbuster films or dancing on Broadway, Hugh Jackman is performing all the way to the bank He can sing. He can dance. He can act. Hugh Jackman is performing all the way to the bank thanks to his multitude of talents. From his Tony-winning Broadway performances to his commercial blockbusters, Jackman is a “jack”of-all-trades. Reportedly now worth $ 50 million, the Sydney-born Jackman began his career on the stage in Australia in the mid-1990s, performing in a number of productions and television shows before hitting box office gold as Wolverine in the feature film, X-Men, in 2000. His gritty performance and toned physique instantly made Jackman a household name across the globe. He quickly went on to star in major feature films, including Swordfish, Van Helsing, X-Men 18
December 2010 www.businessreviewaustralia.com
BUSINESS CELEBS
sequels, as well as Kate & Leopold, for which he was nominated a Golden Globe Best Actor award. In 2009, Jackman was paid $20 million for his role in Wolverine reprising his role as the title character. One of his most wellknown roles to date was in the movie Australia, in which he played a cattle driver alongside Nicole Kidman. His acting chops don’t stop at the big screen, though—Jackman is a bona fide stage actor. In 2004, he won the Tony Award for Outstanding Actor in The Boy from Oz for his portrayal of Australian songwriter and performer Peter Allen. He proved his performances are profit generators, too, as A Steady Rain, costarring Daniel Craig, grossed over $1 million in the fall of 2009. Jackman formed his production company, Seed Productions, in 2005, which produces modest-budget films with actors from Australia. He is also recognized for his tireless dedication to various charities . He is a longtime READ MY supporter of microcredit, which BLOGS extends small business loans Visit to aspiring entrepreneurs in Website underdeveloped countries. www.businessreviewaustralia.com December 2010
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michaela mcnamara
Laundy Hotels Implements
New Racing Industry Innovation Laundy Hotels is testing an electronic form of the paper wallsheet The well-known Laundy Hotels Group is testing a new electronic form of the traditional paper wallsheet that could be the final component of betting automation in Australia’s $5 billion racing industry. Recently installed in Laundry Hotels in the Sydney suburbs of Rozelle and Lidcombe and in Newcastle, the new Formulator technology is the latest in a range of innovative products developed for TABs by Gold Coast based technology company Flexicast. 20
December 2010 www.businessreviewaustralia.com
innovation Formulator’s new Electronic Wallsheet
Laundy Hotels’ general manager, Craig Laundy, says the paper wallsheets which list runners in a race, are a thing of the past with the future in digital display. “Paper wallsheets provide important information for punters yet from the moment they’re put up in the morning they become tattered and shabby. They’re also time consuming and increase costs, taking staff away from other important duties such as serving patrons which in turn affects profits. Digital displays are the ultimate solution providing better quality information, saving money in operations and greatly enhancing the aesthetic quality of a venue, which in turn all help increase patron numbers,” Laundy says. Flexicast managing director Andy Leake says the company’s products are developed by listening to industry leaders and creating solutions that meet their needs. “Laundy Hotels are well known for their industry innovation, so our relationship with Craig has proven to be beneficial for both parties,” Leake says. Paper wallsheets can now be replaced with as few as two screens split into six virtual screens for the kiosk style TAB, right through to up to 17 wallsheet screens for the biggest TABs. “Formulator screens show the key form information punters want to know about including past TAB runs, weight changes, and a breakdown of performance at similar runs, all displayed in a big vibrant format,” Leake says. Once configured to suit punters in a par ticular venue the system will change content READ MY BLOGS automatically, requiring no Visit staff time to manually change Website the sheets and change information. www.businessreviewaustralia.com December 2010
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Austr Industry
The following five companies, ranging across th industries, have truly impressed in 2010. From wh these companies are raising
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December 2010 www.businessreviewaustralia.com
business leaders
ralia’s y Leaders:
Edition
he financial, medical, retail, energy and construction hopping annual profits to a plethora of new contracts, g the bar within their sectors.
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Financial: ANZ Bank
The Australia and New Zealand Banking Group, commonly called ANZ, is the fourth largest bank in Australia in terms of market capitalization— but in 2010, ANZ truly proved to be a force to be reckoned with when its full year results were announced. The bank reported an underlying profit of A$5 billion up 33 percent on the previous year, while statutory profit for the full year was up 53 percent at $4.5 billion. Commenting on how the bank achieved the stellar results, ANZ Chief Executive Officer Mike Smith said, “Three years after announcing our super regional ambitions, we are increasingly distinguished by our geographic diversification which focuses on the world’s best performing economies and the increasing linkages that our personal and corporate customers have with the region.”
“ Three years after an regional ambitions, distinguished by ou diversification whi world’s best perform and the increasing l personal and corpor with the region.”
Medical: CSL
When the H1N1 vaccine spread across the globe in 2009, medical product manufacturer CSL quickly stepped in with a pandemic influenza vaccine. The Federal Government ordered 21 million doses of vaccine for 2009 A/H1N1, 8 million of which were manufactured by CSL. The CSL vaccine was used in one of the largest national vaccine programs in the country’s history. Global sales and “fill and finish” activities relating to CSL’s H1N1 vaccine totaled $235 million, contributing to the company’s total sales revenue of $4.5 billion. “Following the World Health Organization (WHO) announcements regarding the 2009 influenza pandemic, CSL’s global sales of H1N1 Influenza or ‘Swine Flu’ Vaccine, together with related ‘fill and finish activities,’ provided a significant contribution,” CSL Managing Director Dr. Brian McNamee said. 24
ANZ Chief Executive O
Retail: Woolworths
Woolworths is Australia’s biggest retailer and is made up of some of the most recognizable and trusted brands in the country. Its expertise stretches across food, grocery, liquor, petrol, general merchandise and consumer electronics, serving millions of customers every day across Australia and New Zealand. Woolwor ths posted a 4.1 percent increase in the first quarter of FY11, l e d by the c o m pa ny’s
December 2010 www.businessreviewaustralia.com
business leaders Energy: AGL Energy
nnouncing our super we are increasingly ur geographic ich focuses on the ming economies linkages that our rate customers have
Officer Mike Smith
AGL is Australia’s leading renewable energy company and largest private owner, operator and developer of renewable generation assets including hydro, wind, solar, geothermal, biomass and landfill gas. AGL and Meridian Energy announced this year that they have entered binding contracts to construct a 420 MW wind farm at Macarthur in Victoria’s south west at a total capital cost of $1 billion. On completion in early 2013, the Macarthur Wind Farm will be the largest wind farm in the southern hemisphere, and one of the largest wind farms in the world. It will join AGL’s market leading suite of renewable energy generation assets. AGL will fund its share of the cost and the costs associated with the construction of a substation at Tarrone from its existing balance sheet capacity. AGL will have 100 percent ownership of the substation, which will enable the future development of a gas-fired power station.
Construction: Leighton Holdings
The Leighton Group has evolved significantly from
supermarkets. Revenue rose to $13.9 billion in the three months ending October 3, 2010, up from $13.4 billion a year earlier. The company’s food and liquor sales in Australia rose 3.2 percent to $9.3 billion in the quarter. This year, Woolworths also announced the successful completion of its $704 million off-market share buy-back. Chief Executive Officer Michael Luscombe said, “We have now returned more than $1 billion to shareholders in the 2010 calendar year—a combination of this $704 million off-market buy-back plus a $325 million on-market buy-back completed in the the construction company of its origins over 50 first half of the calendar year.” years ago. Today it is a diversified service provider www.businessreviewaustralia.com December 2010
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Your vision. Our insight.
business leaders
Leighton Holdings is running away with the business in Mongolia
to a range of private and public sector clients. The Group utilizes its financial and intellectual capital to provide integrated solutions to clients’ infrastructure and project requirements. Leighton won a number of contracts in 2010, from a US$733 million Iraq Crude Oil Export Facility Project to numerous infrastructure projects throughout Asia, the Middle East and Australia. Leighton also announced a $612 million profit after tax and minorities and a pre-tax profit of $843 million for the 2010 financial year.
Before his retirement in 2010, former Chief Executive Wal King reported that he was very pleased to report such a strong profit result which was based on a solid contribution more from Australia, driven by transport articles infrastructure, contract mining, Visit telecommunications and operaWebsite tions and maintenance.
For feedback and comments please get in touch. > feedback@whitedm.com
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Boardroom Positions
V acant
What’s the Real Cost of Appointing a Foreign Director
acant:
irector?
Money matters
Businesses who use foreign independent directors may be leading to significantly poorer performance, weaker governance and higher costs Written by Knowledge@Australian School of Business
Jossel Ginsburg, one of the founders of web content management firm, Presence Online, has a resounding memor y of one independent director who was appointed to the company’s board. “He never turned up in person,” he recalls. When Presence Online went international in 2002, the investors had insisted on appointing a US director to the board. “The [international investment bank] found us a venture capitalist from their US affiliate and recommended that we appoint him as a director. We assumed that he would assist us in breaking into the US market,” says Ginsburg. “But in fact he did not help us. During the time when we really needed help, we held our board meetings every month and he would only join us via mobile phone for those specific meetings. It was an expensive and unhelpful exercise.” In the interim, the company was sold to technology corporation, IBM. Ginsburg’s experience is not unique. “Firms with directors from abroad are associated with www.businessreviewaustralia.com December 2010
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significantly poorer performance, weaker governance and higher costs,” according to Ron Masulis, a professor in banking and finance at the Australian School of Business. His research, based on an analysis of 13% of Standard & Poor’s index of America’s 1500 largest public companies with foreign independent directors, has pinpointed many adverse effects of foreign board members on corporate governance. The discussion that ensued following the cataclysmic failures of US corporations, Enron and Worldcom assumed that the key to the future prevention of comparable disasters would lie in better quality boards. Their effectiveness was to be ensured by appointing more international, 30
diverse and independent members with better skills. While no one will argue against the positive impact of appointing directors with improved skill sets, simply going across borders to hire directors does not solve problems – rather it creates new ones, Masulis points out. Enron’s management committed high-profile accounting fraud, “and one particularly noteworthy aspect of the Enron board was that its audit committee included two foreign independent directors, the chairman of the Hang Lung Group in Hong Kong and a senior executive of Group Bozano in Brazil,” he notes.
December 2010 www.businessreviewaustralia.com
“ If yo trem in yo succe the m
Money matters Empty Seats at the Table
Foreign directors can be less effective than their domestically based counterparts for several reasons. One is the tyranny of distance, Masulis says. A director who is geographically distant from corporate headquarters finds on-site visits and attending board meetings more difficult and time-consuming. This undermines his or her ability to closely monitor management. Masulis and fellow researchers, Cong Wang from the Chinese University of Hong Kong and Fei Xie from Washington’s George Mason University, found that – when all else is equal – foreigners are almost three times more likely than locals to miss at least one out of four board meetings. Such problems are widespread. The Wall Street Journal reported Citigroup considered replacing Winfried Bischoff as its chairman because “Sir Win, who is based in London, hasn’t been exercising adequate oversight.” In February 2009, Sir Win stepped down. The Korea Corporate Governance Service has also noted that the attendance record of foreigners at board meetings of Korean public companies continues to be poor. However, in Australia companies with foreign independent directors may be more alert to the problem due to the stronger regulatory monitoring that came with the Corporations Act 2001, suggests Geoffrey Cousins, a director of Australia’s largest telecommunications provider, Telstra. “In the US, the annual report only lists
company directors who failed to attend more than 75% of the board meetings. In Australia, we record and publish any absentees to any board or committee meeting in precise detail,” says Cousins. “So maybe that helps!” The long-distance factor also causes foreign directors to fall short in their ability to glean relevant information, Masulis indicates. Often cut off from local networks that provide valuable “soft” information, they have generally less insight on what’s happening in and around companies’ operating environments. They are less familiar with local accounting rules, laws and regulations, governance standards, and management methods, making it more difficult for the foreign director to evaluate the performance or challenge management decisions. “Our analysis shows that firms with foreign directors on their boards are significantly more likely to end up with financial misreporting and they are associated with a 10 % higher, and slightly less equity-based, CEO compensation than other corporations,” says Masulis. “This suggests that the presence of foreign independents contributes to weaker corporate governance and higher costs.” Investors are aware of these problems. Stock markets react negatively to a firm’s decision to appoint a foreign director, the research shows. In the three days surrounding the announcement of a foreign director’s appointment, the market-adjusted stock return is minus 0.56%. This is significantly lower than
ou hire the right people, the positive impact can be mendous, especially when the trends and developments our industry come from other countries and when the ess of your local company is massively determined by movements on the world market.” www.businessreviewaustralia.com December 2010
31
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Money matters those generated by appointments of domestic presence in their foreign director’s home region. independent directors. But he points out that many of the US firms in the study did not have large operations outside On-location Operations of the country. This means key questions, for However, multinational corporations cannot afford companies considering the appointment of a to go without foreign directors, argues Robert foreign director, concern whether they have Webster, who specializes in board services large sales or operations offshore and where at the Sydney office of executive recruitment they are located. firm, Korn/Ferry International. “They need to Clearly, the efficiency of a board comes down to be global in the true sense of the word and that how well it is managed. “And this inevitably depends includes the board. It comes down to finding on the individuals involved,” says Webster. Cousins, the right people who are commitwho previously chaired the board ted to the company and easy of ad agency George Patteron travel, and the issue of son and has served as a how well the chairman director of media entermanages the board,” prises Publishing says Webster who and Broadcasting evens the score, by Limited, the Seven noting: “Many local Network and Hoyts directors are fairly cinemas group, uncommitted, too.” agrees. “If you hire I n c r e a s i n g l y, the right people, the a s c o m pa ni e s look positive impact can beyond national borbe tremendous, espeders for opportunities to cially when the trends and cut costs and generate growth, developments in your industry there is a strong case for foreign come from other countries and when directors, Webster attests. A foreign direc- the success of your local company is massively tor’s knowledge of home countries and their determined by the movements on the world market,” connections to local business networks can be he says. highly beneficial when companies move into new However, Masulis’s research offers seriterritories where they face unfamiliar political ous food for thought on the motivations behind landscapes, regulatory environments, industry boardroom appointments. Is it possible that some structures and consumer preferences. Indeed, foreign independent directors are brought onto Masulis and his team found that in mergers, boards precisely due to their limited the returns of acquiring companies are signifi- monitoring capabilities, “much more cantly higher in deals where the acquirer has like the appointment of other articles a foreign director from the same region as the deficient independent direcVisit target market. tors, such as very busy or old Website Overall though, Masulis concludes that directors?” he asks. companies with foreign independent directors exhibit significantly lower returns on assets (ROA) For feedback and comments please get in touch. when they do not have a significant business > feedback@whitedm.com www.businessreviewaustralia.com December 2010
33
Cloud Computing Transforming IT
–
technology
Cloud computing is transforming the way enterprises purchase IT infrastructure. If your business is not yet on the bandwagon, the time to invest is now Written by Cameron McNaught, Executive General Manager Solutions, Fujitsu Australia
To become more responsive, organisations are seeking information technology solutions that align with business strategy and are truly flexible enough to support changing needs and conditions. At the same time, budgets remain static or barely keep pace with the growing data requirements of existing applications. To reconcile these conflicting demands, organisations need to transform the way they manage their information technology – to reduce capital expenses and operating costs while becoming nimble enough to meet the business challenges they face today and tomorrow. For many organisations, cloud computing presents an appealing opportunity to do more with less for their IT systems. Cloud computing enables organisations to consume technology infrastructure, applications, activities or content as needed. The concept of cloud computing, where computer hardware and software is delivered www.businessreivewaustralia.com December 2010
35
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Make. Market. Sell. [ www.research-store.com/foodanddrinkdigital ]
technology on demand from centralised data centres, is transforming the way enterprises purchase IT infrastructure. The simplicity that comes with accessing computing resources – such as server, storage space and applications – from a secure data centre with complete self service capabilities is appealing to organisations that are struggling to control costs or cope with rapidly changing business needs. Cloud Services represents a significant shift from the traditional client-server computing model where infrastructure is distributed and made available to users working across multiple locations. In fact, it more closely resembles the early days of computing when technology resources were deployed from a mainframe system at a central location. Users were oblivious to how services were delivered or which hardware and software platforms were used. These days, however, organisations are engaging managed service providers, which own and operate data centres, to deliver server capacity and applications over high-speed broadband links. Cloud computing takes this concept one step further by making a set of predefined services, delivered from large, centralised computing and storage systems, available to customers ‘out of the box’. Cloud computing is a ‘utility’ computing model where customers simply select how much computing power they need and when they need it. They can increase hardware capacity with business demand, more easily meet regulatory and compliance obligations, set services levels to match business requirements and avoid unnecessary capital expenditure.
However, IT departments may be reluctant to embrace cloud computing because of their doubts about: Security – through concerns of safety to put data outside the corporate firewall and how do I control it once it’s out there? Border Controls - with concerns on how to ensure the company’s data stays in the right place and within the legal jurisdiction necessary. Lock-in – raising questions about the ability to move a company’s data and applications in the need to switch providers at any time. Licence Options – questioning whether a business can use its current licences or what licences will work in a Cloud? With analysts predicting that many
www.businessreivewaustralia.com December 2010
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technology
“ The Fujitsu approach delivers a single point of contact for the provision and management of a public, trusted or private Cloud Service”
organisations will jump on the cloud bandwagon, Gartner has estimated that worldwide cloud services revenue will exceed US$150 billion by 2013. Gartner also predicts that by 2011, early technology adopters will forgo capital expenditure and purchase 40 per cent of their IT infrastructure as a service. To explain the benefit potential of cloud computing, it is useful to outline a definition. Within Fujitsu, we describe cloud as being the consumption of: Infrastructure – that is, on-demand infrastructure estate delivering compute, storage and infrastructure applications. This includes pay per use, providing the option to be billed for what is provisioned and consumed, thereby allowing for predictable and controlled costs that match the resources of the business. Application – which is predominantly the provision of an application through a pay per use or subscription based model. This includes Self Service, which enables a business to retain control and with the ability to govern IT services in real time with no involvement from the provider. Activity – the ability to subscribe to a business process or function as an activity. For example, Fujitsu is currently working with a customer to provide this service for large volume mailing services. Essentially delivering a platform which is able to respond to the dynamic shifts in business demand ensuring supply is equally coordinated up or down. Content – essentially, the provision of content services which can be subscribed to from an application or a platform. The best known consumer example of this is probably iTunes and the ability for that application to access a pool of content be it Music, Movies or Audio Books. Fujitsu views its cloud services as an evolution, not a revolution. The Fujitsu approach delivers a single point of contact for the
provision and management of a public, trusted or private Cloud Service. Fujitsu Australia is currently leading the way in this marketplace with local facilities and expertise. With the backing of the Fujitsu global platform it will generate enormous confidence and growth for cloud services in the region. Fujitsu has invested more than $1 billion USD into Cloud computing on a global scale, with significant investment into the design and implementation of a local Cloud environment to meet the data sovereignty requirements of the domestic marketplace, particularly those of the Financial Services and Government sectors. Furthermore, Fujitsu’s cloud services operate from numerous wholly-owned, environmentally-friendly Australian data centres, so customers gain additional security to move to the cloud from knowing where their applications and data are stored, reducing concerns around data governance and giving them additional options re disaster recovery. Fujitsu is committed to Cloud Services in the local region, more and our current Cloud enviarticles ronment has already proven Visit success in production for our Website local customers.
To find out more about Fujitsu’s Cloud Services, visit
> w ww.fujitsu.com/au/services/ infrastructure-services/cloud/index.html
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luxury
marketing 2.0
Brand
Survival Strategies:
A Sense of Security at a Premium Price Despite the global financial crisis, high-end brands such as Louis Vuitton and Gucci have fared rather well thanks to meticulous craftsmanship and clever marketing Written by Knowledge@Australian School of Business
When the going gets tough, the monied still go shopping. While luxury brands experienced mixed fortunes in the financial crisis, not all premium labels have had to tighten their handcrafted belts. Meticulous craftsmanship remained a strong selling point for big spenders worldwide who kept splashing out on quality products that promised to hold or increase their value over time. Depending on who you talk to, the luxury goods sector shrank by between 3% and 8% in 2009. Global consultancy Bain & Company puts the sector’s downturn at 8%. Global brand research agency Millward Brown’s annual list of the world’s most powerful brands says there was a 3% slump in 2009. Millward Brown researcher Pierre Dupreelle says the 11% fall in brand value at Parisian fashion house Chanel was a sign of the times. Consumers turned to more practical products, items they needed rather than wanted, he says. Watchmaker Rolex, along with many highend jewellery makers, saw its overall brand value drop too – in Rolex’s case by 14%. But brands that focused on heritage and history – rather than high fashion – fared better. At Louis Vuitton (LV),
sales remained robust throughout the economic turmoil. “We’re not panicking about the global financial crisis,” says Philip Corne, chief executive, who oversees a network of 14 stores throughout Australia and New Zealand. The LVMH (Louis Vuitton Moet Hennessy) Group, which markets 60 prestigious brands across categories from wine to jewellery, recorded an overall brand value increase of 2% in 2009, to US$19.78 billion, calculates Millward Brown.
Feel the Quality
The reasons why financially pressured – but traditionally high-spending – clients have stayed loyal to the LV brand are underpinned by the company’s philosophy, Corne believes. For example, the brand never discounts or has a sale – it is always sold at full price. That translates to a good investment for customers, he suggests, as the brand holds its value. “If we never go on sale, then we never undervalue the product,” he says. “This consistency is well-recognised by the consumer. “I think what has happened through this period of economic turmoil is that the customer, who has
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seen the word ‘luxury’ bandied around fairly freely by lots of brands or service providers in recent years, has stood back and asked, ‘Well, what does this word really mean? And who is delivering, in a faithful way, the promise that sits behind positioning as a luxury brand?’” For the group of companies within LVMH, and for Louis Vuitton in particular, the customer has responded in a very positive way during a period in which most observers would expect that type of discretionary spend could be damaged, Corne says. “We’re finding there are many customers being very cautious in the way they shop for some of the basics of life,” he says. “But with the money saved they have rewarded themselves – at the same time being careful with the way they spend it. They will only now buy a luxury item if the brand can show credibility with the product and support of the product.” Corne claims LV also benefits from consistency in its marketing and production strategies. The majority of its products are still made in France, for instance, while its shoe production facilities are 42
in Italy and its watches are made in Switzerland. “Everything we do has implications for the Louis Vuitton brand so we have to be extremely careful,” Corne says. “Our way of managing the brand is to not give it to anyone else to manage. We only sell through our own stores, we only manufacture in our own factories. We do all of our e-service ourselves and we use the same degree of creative, of care in the management of that service as we do with everything else. Nothing is outsourced. It’s all handled by our own people. We try to keep that contact with the customer as pure as we can.”
Shopping Japan for China?
An emphasis on value retention also brought a 2% rise in brand value at Gucci. The Italian fashion and leather goods label partners with auction house Christie’s to offer appraisals on its vintage luggage and handbags. French rival Hermès – where brand value rose 8% – focused on heritage in its sponsorships. And it was nimble in responding to the crisis, says Millward Brown’s Dupreelle.
December 2010 www.businessreviewaustralia.com
marketing 2.0 Hermès executive chairman Patrick Thomas claims stringent quality standards drove revenue growth to 1,914.3 million euros in 2009, up from 1,764.6 million euros in 2008. But the company, which is in the majority family owned – 71% of shareholders are family members – moved fast as markets changed. Its growth strategy included opening and renovating 32 stores worldwide and forging into new territories in Brazil, Panama, the Philippines and Turkey. Other initiatives included a men’s store in New York and the first Hermès Maison store in China. The brand, which has been operating in northern Asia since the early 1990s, generated 43% of its sales in the Asia-Pacific region in 2009. That’s despite falling sales in Japan, which now looks certain to lose its status as the world’s number one luxury brand market. China provided the panacea for slumping highend brand sales in the West during the financial crisis. Accounting for 27.5% of the global market, it overtook the US in 2009 to become the world’s second largest luxury goods market, according to the Beijing-based trade and consumer-focused World Luxury Association (WLA). Chinese sales
squeezed over the past two years. Winkler says the number of cars sold by Porsche overall during the financial crisis fell by 12%, but considers this a strong result compared to the 20% sales hit taken by luxury automobile makers in general. Rolls-Royce, Lamborghini, Aston Martin and Bentley have announced factory slowdowns. Sales figures released by the Australian Federal Chamber of Automotive Industries show all topflight brands underperforming. So why is Porsche comparatively speeding ahead when even Winkler concedes that a luxury sports car is the ultimate deferrable purchase? “We have worked harder than usual with our traditionally high-repeat customer base,” he explains. The typical Porsche buyer, Winkler describes as “a 47-year-old who has run their own business for 20 years, has the house paid off and money set aside for the children’s education and now wants to do something for themselves.”
Top-level Tribes
Common factors keep customers coming back to luxury brands or help them to attract new buyers.
“ We have worked harder than usual with our traditionally high-repeat customer base” of US$9.4 billion for 2009 are expected to grow further to US$14.6 billion in the next five years, the WLA claims. And the China Brand Strategy Association is tipping the number of Chinese premium brand customers will hit 250 million this year. German car manufacturer Porsche surpassed its home market sales figures by 500 to 1000 cars by selling 13,000 cars in China last year, reports Michael Winkler, managing director of Porsche Cars Australia. “We sold less than 1000 cars in China six years ago,” he says. The increase in vehicles sold in Asia offsets falling sales figures in the West where margins have been severely
It’s all about a sense of belonging, according to a recent study on the shaping of transnational brands by Julien Cayla, a lecturer in marketing at the Australian School of Business. “Brands allow people to feel connected to a sphere larger than their immediate environment, partaking in ... a global village,” he says. “Brands mediate new kinds of social relations, enabling connections between people who may never have seen each other, yet come to share a sense of moral responsibility toward the brand and the community to which they perceive themselves as belonging.” When the global economy is shaky, the purchase
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43
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marketing 2.0 of a luxury branded item may give the buyer a sense of security. “Part of the value of purchasing, for example, a Chanel clutch, is that the product comes with a guaranteed relationship with the brand,” says Rebecca Huntley, director of research for the social trends indicator, the Ipsos Mackay Report. “Should anything go wrong with the product for example, it will always be replaced or repaired.” Additionally, there is perceived prestige in simply being a luxury buyer, as long as the brand continues to maintain its integrity and its story, Huntley says. “In tough economic times luxury brands must continue to make sure their product sets standards. Certainly the desire for luxury is still there. But even for brands doing well it is an increasingly crowded market and that means people are more discerning about what they are spending their money on.” Crucial factors for luxury brands, Huntley notes, include ensuring the right celebrity is attached to the brand, maintaining exclusivity by never having a sale, being highly selective about where new stores are opened and providing a premium service.
not surprising. Sean Ashby, founder and owner of upscale underwear and swimwear brand aussieB um , s aw his busines s increase net profit by 40% in 2009 and all of that growth was online, he says. While his brand is not in the luxury stratosphere of Hermès, Louis Vuitton and Porsche, Ashby says customers have similar buying habits with all upscale brands, especially during financially difficult times. “Even when times are tough, people still want to buy luxury goods but, strangely enough, sometimes they don’t want to be seen buying them,” he says. So a blue Tiffany & Co bag swung off the elbow of a well-heeled shopper, for example, perhaps sends the wrong message during a financial crisis, he suggests. “It’s considered flaunting, which may be a little insensitive when others are going through difficult times. Shopping online allows those in search of luxury a more private experience.” But as recovery continues, luxury brand sales are set to grow online regardless. “The reality is that online shopping is only going to grow for any product category,” Corne says. “Louis Vuitton has recognised that online shopping is Luxury Online a very real channel of distribution more Almost counter-intuitively, sales-boosting potential and is simply another service that articles Visit for upscale brands is being forecast through internet we need to be able to offer to all Website marketing opportunities – although the ubiquity of our consumers.” of the web brings with it the risk of inspiring imitations and downgrading quality. According to Bain & Company, online sales of luxury goods surged 20% in 2009. Claudia D’Arpizio, an analyst at Bain, expects online luxury sales to double to about 5% of the industry total in the next five years. This article was produced and published by To some brand owners this online increase is Knowledge@Australian School of Business. www.businessreviewaustralia.com December 2010
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december http://www.watermgmtmining.com.au/Event.aspx?id=367922
http://www.iqpc.com/Event.aspx?id=361488
http://www.informa.com.au/conferences/transport/infrastructure/northern-territory-transport-infrastructure-summit
dec
01
Water Management in Mining 2010
Holiday Inn Centre, Perth Water Management in Mining is committed to addressing the fundamental role of sound water management in achieving environmental best practice. The conference will bring together mining companies, mine sites and mining construction contractors, and has been researched and developed for environmental managers, mine planning managers, hydrogeologists and mine planning engineers. > Visit Website
www.operationalexcellence.com.au
dec
01
Hilton on the Park, Melbourne, VIC This event has been specifically designed to educate all stakeholders involved in contractual aspects of construction projects and to share knowledge, experience, challenges and solutions. As there are such high chances of disputes arising within construction projects it is essential that you understand how to reduce this risk by adopting specific strategies for both avoiding and effectively managing disputes. > Visit Website dec
08
dec
07
4th Annual Dust Management Strategies 2010
Stamford Plaza, Brisbane The event will investigate the growing community concerns in the industry and best practice case studies into the health and safety of mine workers. It is the only one its kind designed specifically to address two of the key issues troubling mines and affecting productivity.
Mine Reconciliation 2010
Crowne Plaza Hotel, Surferâ&#x20AC;&#x2122;s Paradise Mining IQâ&#x20AC;&#x2122;s Mine Reconciliation 2010 conference will present expert insights and industry case studies into improved reconciliation and resource estimation strategies. > Visit Website http://www.ausgeothermal.com/ http://www.minereconciliation.com.au/Event.aspx?id=368746
> Visit Website 46
Construction Dispute Avoidance and Resolution
December 2010 www.businessreviewaustralia.com
AUSTRALIA
dec
http://www.bioenergyaustralia.org/
dec
08
Bioenergy Australia 2010 Conference
08
Novotel Sydney Manly Pacific, Manly NSW Last year this conference was the biggest ever with just under 350 delegates. This yearâ&#x20AC;&#x2122;s program will include a trade exhibition show, technical posters and a tour to bioenergy facilities in the region and will cover policies and programs, projects and project development case studies and emerging opportunities.
6th Australasian Congress on Applied Mechanics
Perth Convention Exhibition Centre (PCEC) Perth WA ACAM 6 aims to provide an international forum for researchers, industry practitioners, engineers and postgraduate scholars to promote, exchange and disseminate knowledge and experiences of the most recent results and advances in a wide range of topics in Applied Mechanics. > Visit Website
http://www.acam6.org/index.html
> Visit Website
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acwa
Aquaculture Council of Western Australia Inc The Aquaculture Council of WA (ACWA) represents more than 80% of the Western Australian aquaculture industry, made up by individuals, corporations and institutions. It was established in 1998 in response to the need for the then new industry to mount a united front to influence the legislation and public policy that would determine the path for responsible aquaculture businesses to start, grow and prosper. All over the world, fresh seafood is in high demand, as a healthy giving, fashionable food and the traditional supply from the wild capture sector can’t, and will never again be able to, match demand. Nationally and internationally aquaculture is filling the fillet void, most notably by Atlantic salmon and Barramundi, and products like oysters, abalone, yabbies, marron and mussels are regulars on restaurant menus. Today more than ever, ACWA is helping to
Dan Machin Executive Officer
guide the exponential growth of the industry. In WA 2008/09 the industry grew by 38% to $12million GVP, and it is expected that by 2015 it will be the State’s largest seafood supplying sector by volume. Nationally aquaculture in 2008/09 produced 62,500 tonnes of seafood valued at $868 million. This accounted for about 35% of the nation’s seafood production by value and 30% by volume. In WA the aquaculture industry highlights include pearling in the far north around Broome, barramundi farming in the Buccaneer Archipelago, and as you travel south you will find aquaculture touches on almost every region, ranging from a number of ornamental and fin-fish operation in the Pilbara and Gascoyne, Black Pearl farms in the Shark Bay and the Abrolhos Islands, the world’s largest algae farm for the production of beta carotene near Geraldton and a vast network of yabby,
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marron and inland saline finfish operations stretch from the Midwest to Esperance. There’s mussel farming in Cockburn Sound, Denmark and Albany and significant investments in abalone farming in the Great Southern. This year ACWA applauded the State Government’s decision to make the Department of Fisheries the one-stop regulator for the aquaculture industry. This was a major milestone that will see the cuts to red tape save the industry considerable expense. The next major challenge for ACWA is to deliver a positive result from the current on-going negotiations with the State Government on its law and policy reform agenda to ensure a simple and timely government approvals process and 50
the creation of improved leasehold rights, which will render greater financial security to producers and their investors.
Aquaculture Council - Strategic Goals
ACWA’s core business is government policy advocacy- particularly those things that companies or small producers cannot easily change individually. This enables its members to focus on the business of growing fish. Within this core business the Aquaculture Council of Western Australia has five strategic goals: •To promote the Western Australian aquaculture industry to the community and government at State and national levels.
December 2010 www.businessreviewaustralia.com
acwa
Black Pearl Farm, Abrolhos Island, Midwest Region, Western Australia 4
•To uphold the principles and practice of ecologically sustainable development in all WA aquaculture sectors. •To provide an effective communications network for all members and stakeholders. •To influence government and its departments to ensure an economic and legislative environment that encourages the development of responsible aquaculture enterprise. •To provide quality cost-effective support and services to members. Benefits of membership •Provides critical industry information to members •Represents industry on various aquaculture related National, State and Local Government
working groups and committees •Lobbies members of parliament and government departments •Organises industry relevant events, functions and training. •Promotes the aquaculture industry to the community.
Read more association profiles > Visit Website For feedback and comments please get in touch. > feedback@whitedm.com
www.businessreviewaustralia.com December 2010
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ALPGA
Australian Liquefied Petroleum Gas Association
Written by Alison Lee, Communications Manager LPG Australia is the leading industry association and national peak body representing the $3.5 billion Liquefied Petroleum Gas Industry within Australia. The Association has been at the forefront of Australia’s energy debate since 1958. As the national peak body, the Association’s aim in support of Australia’s national interest is to achieve energy security and economic prosperity in a lower carbon economy. This can be achieved through a clear focus on advocating the value and benefits of LPG as an essential alternative fuel for Australia’s current and future energy needs. Advocacy to government, state authorities and the consumer, is supported by progressive policy development based on sound research, analysis and expert commentary, the on-going development of national standards and innovative products and technology, and the development of the Industry’s specialist workforce of over 10,000 personnel. As the national peak body LPG Australia is
committed to being the advocate and collective voice for the LPG industry by supporting and promoting the interests of our members and the community, and delivering valued and progressive membership services. By engaging our strong and active membership base, the Association works constantly to raise community and government awareness of LPG as an alternative energy solution. The Association proactively consult government, regulators, industry and our members to tap into the potential LPG offers to further reduce Australia’s growing reliance on imported crude oil and fuels. LPG is a versatile, clean and convenient energy option. Currently, only 58 per cent of the LPG produced annually within Australia is being consumed. This presents an enormous growth opportunity for LPG to deliver Australia’s energy security and lower our nation’s carbon emissions. Our challenge as an Association and an
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industry is to ensure that LPG forms part of Aus- national peak body representing the LPG Industry. traliaâ&#x20AC;&#x2122;s future energy needs.
Our Purpose and Values
LPG Australia is committed to representing the LPG industry by adhering to the principles of integrity, consistency and innovation while maintaining and improving industry safety standards and the performance of the Industryâ&#x20AC;&#x2122;s 10,000 strong specialist work force. The Association has achieved government, industry and community recognition by delivering on these values. The overarching mission of the Association is to be at the forefront of Australiaâ&#x20AC;&#x2122;s energy debate, driving policy with a strong and effective voice. All our strategies combine to deliver innovative, proactive and flexible services and programs to assist with the development and growth of the LPG industry in Australia. The vision for the Association is to be recognised by government, industry and the community as the 54
Our Customers
Millions of people around Australia currently use LPG every day across hundreds of applications. Our customers rely on the multi-purpose functionality of LPG within commercial businesses, industry, transportation, farming, power generation, cooking, heating, and for recreational purposes. LPG is an integral component of the energy mix within Australia as it can be used anywhere at any time. LPG is an especially vital source of energy for regional areas as it can be economically transported and used without large investments in technology and infrastructure.
Our Industry
The LPG industry is extremely diversified and competitive. With its availability and diverse applications, the LPG industry is equipped to immediately contribute to a sustainable energy
December 2010 www.businessreviewaustralia.com
ALPGA
Statistics Type: Energy Location: Australia
Executive Director: Michael K. Carmody
Founded: 1958 solution anywhere and anytime. As an alternative fuel source, LPG is playing an important role in shaping Australiaâ&#x20AC;&#x2122;s future energy and environmental policies. The LPG industry contributes over $3.5 billion a year to the Australian economy by developing supply, infrastructure and the availability of LPG within both rural and urban communities. With the support of government, industry and consumers, LPG can play a pivotal role in establishing a more sustainable energy solution.
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Executive Director: Michael K. Carmody Key people: Manager Policy and Program Development - Stephen Reynolds Government Relations Warring Neilsen Communications Manager Alison Lee Membership and Administration Manager - Silvana Zubac Currency: AUD www.lpgaustralia.com.au
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www.businessreviewaustralia.com December 2010
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