Three on list for Qantas Chair

Reports in The Herald Sun and Business Daily says that Qantas directors are believed to have shortlisted three candidates to lead the airline, with at the head of the list of possible replacements for outgoing chairman Margaret Jackson is high-profile businessman and existing board member James Strong.

However, as a former chief executive of the airline, the 63-year-old Mr Strong is precluded from the post under the board’s charter, but the way could be cleared if the board recommends shareholders approve his appointment.

The identities of the other two candidates are not known, but they need to be Australians, but one notable Australian with suitable experience is Sir Rod Eddington – a former boss of British Airways and veteran of Ansett Airways and Cathay Pacific, however, he has declared himself a non-starter.

High ranking Qantas officials told BusinessDaily that a person with Mr Strong’s obvious airline talents was needed, because of the complexities attached to running an airline.

Ms Jackson’s replacement will be required to recruit a replacement for the carrier’s chief executive, with Geoff Dixon retiring in two years when he turns 70.

Mr Strong’s chances were boosted when Melbourne fund manager Andrew Sisson recently expressed support for his appointment, a view which BusinessDaily was told impressed some board members.

Mr Sisson was a key player in resisting a buyout for the carrier by Airline Partners Australia. 

Pressed on whether Mr Strong was regarded as too close to Mr Dixon – friends for more than 30 years – a senior Qantas source said the decision was about the future, not the present.

Whoever was appointed chairman would lead the carrier through the post-Dixon years, nevertheless it is also believed the lobbying for Mr Strong has been at the centre of recent board tension which could split what until recently was a united board.

The issue centres on Clause 24 of the board charter which prevents the appointment of a former chief executive as chairman, and which several existing directors adopted in 2003 as a model of good governance.

Six of the directors who put the charter in place – Ms Jackson, Mr Dixon, chief financial officer Peter Gregg, former BHP chief executive Paul Anderson, former government bureaucrat Mike Codd and Commonwealth Bank chairman John Schubert – remain directors.

Industry officials say that it would be seen as a embarrassing turnaround if the rule was dumped.  They add that it is difficult to understand why the clause was incorporated into the charter. It was originally intended as a guide to good governance.

As a leading businessman close to Qantas told BusinessDaily this week: “The question people should be asking is why Clause 24 was inserted in the charter in the first place?”

“The second question they should be very aware of is that there is no one who knows more about aviation and can do the chairman’s job better than James Strong.”

Another question the same businessman raised was whether the clause was specifically inserted to block Mr Strong’s appointment should he seek the appointment.

Mr Strong – who was replaced as chief executive in 2000 by Mr Dixon – only returned to the Qantas board a year ago.

At the time Mr Dixon said he welcomed the appointment and supported the move.

Report by The Mole