Government will announce name of external appointment before New Year.
KiwiRail will have a new chair in place by January 1, and it will be an external appointment, acting chair Sue McCormack has told NBR.
The move comes as chief executive Greg Miller resigned this morning, saying recent and sustained allegations in the media about his leadership style, while rejected by him, had become a distraction. In the past two years, six out of Miller’s 10-strong senior executive team have resigned.
It was also alleged to NBR that the board was weak and dysfunctional and had struggled to stand up to its chief executive.
McCormack said the government (as the shareholder of the state-owned enterprise) “had been doing the rounds” and had chosen someone as new chair whose name would be announced in due course. McCormack had taken on the caretaker role after the death of former chair Brian Corban six months ago.
McCormack said Miller had approached her over the weekend about resigning and she had called an urgent board meeting on Tuesday night to discuss the matter.
“It was Greg’s decision to leave. The decision to resign was solely his. He told me it reflected what he was feeling about media coverage, what was best for his family and for the interests of KiwiRail.”
She said there had been no pressure on the board from government regarding Miller’s position, and no discussions between Miller and the board about the difficult position the company was in with its union, which is planning strike action next month after pay negotiations broke down.
Miller’s deputy, Todd Moyle – a long-standing KiwiRail employee who has been heading the negotiations and who enjoys a good relationship with the union – is now acting chief executive. Rail and Maritime Transport Union general secretary Wayne Butson, who has described Miller as “anti-union”, could not be reached for comment.
Moyle is due to leave at Christmas to take up a new position with Ngai Tahu Holdings, whose chief executive is former KiwiRail director Mike Pohio. However, McCormack said she would be discussing with Moyle his ability to extend his time at KiwiRail.
The Miller review
McCormack said the board expected to receive a report next week on the independent exit interviews with KiwiRail employees who had resigned. The interview process was instigated by the board after concerns from within the company about Miller’s leadership style were reported, initially by NBR and then other media. After NBR broke the story, Miller threatened legal action against the publication.
McCormack said 22 people had been approached to be interviewed and 18 of them had taken up the offer. She said she had no knowledge yet of what had been discussed in the interviews, and neither had Miller.
Asked if the board had faced pressure from government to address the issues aired in the media, McCormack said: “We know what the government’s expectations are of a good employer and we have an obligation to follow up on what we hear.”
McCormack confirmed union claims that Miller would be receiving 50% of his base FY21 salary as a bonus under the terms of the company’s short-term incentive scheme programme.
According to the company’s latest annual report, Miller’s combined salary and benefits for FY21 were $997,452.
“We are in a competitive market and based on the terms of his agreement and his performance this is what he is entitled to.”
When NBR asked if Miller would receive any form of exit payment, KiwiRail said the SOE didn't disclose any individual's employment details, other than as required in the annual report.
Political reaction
National Party spokesperson for SOEs, Mark Mitchell, said news of the strike action and Miller's resignation was the result of "more government incompetence, lack of oversight and failure to act."
“The serious internal issues within KiwiRail have been widely known for a long time and quick action was required by the government to appoint a new chair after the passing of Brian Corban. This didn’t happen.
“As a result, Minister Clark has allowed our internal supply chain to be hamstrung by an incompetent and rudderless KiwiRail."
Miller joined KiwiRail as its chair in November 2018, championed by New Zealand First, which was then part of the coalition government with Labour. NZ First leader Winston Peters, as Minister for State-owned Enterprises, was keen for him to become managing director as well, but Labour opposed this because of the governance issues this would create.
Miller then relinquished the chair and became chief executive in May 2019.
