Outgoing Crown CEO Bags $3 Million Severance
Imagine a world where you receive a seven-figure payout despite quitting your job after massively failing at it. That is the world of outgoing Crown Resorts CEO Ken Barton.
Rumours of Barton stepping down from his role of Crown CEO circulated last week following the damning Begrin report. Barton came under pressure to step down after an inquiry showed his shortcomings as Crown’s CEO.
Commissioner Patricia Begrin was particularly negative about Barton. “He is no match for what is needed at the helm of a casino licensee.”
“Mr Barton’s conduct at the Annual General Meeting in October 2019 as CFO of Crown was quite improper. However, his attempts in the witness box on 23 September 2020 to justify his conduct at the Annual General Meeting, were even more inappropriate for the CEO and director of Crown and a director of the Licensee.”
“It demonstrated a serious lack of judgement and insight into the expectation of the highest standards of propriety, candour and co-operation of a director of a company that holds a casino licence.”
Barton officially quit his role of Crown CEO on February 15. The outgoing executive wrote a compensation package into his contract. Barton may not have a clue how to run a casino, but he knows how to look after his own interests. The clause in his contract pays him a year’s salary if he leaves the company without notice. Only a severe breach or misconduct prevents Barton from receiving the package. This means Barton gets his hands on $3 million despite being appalling at his job and covering up corruption.
Helen Coonan Takes Temporary CEO Role
The hunt for Barton’s successor has started. Chairwoman Helen Coonan takes the reigns as CEO until Crown finds Barton’s successor. She isn’t enthralled about the situation, but needs must. Coonan’s joint roles make her an Executive Chairman, a role Crown received criticism for in the past.
“Assuming the role of Executive Chairman is a decision I have not taken lightly but the Board feel it provides leadership stability at this important time for the business. The Board is determined to maintain the momentum and Crown takes significant steps to improve our governance, compliance and culture. Working closely with the NSW Independent Liquor and Gaming Authority and regulators in Victoria and Western Australia, I will continue to lead on the implementation of Crown’s ambitious reform program.”
Crown has long been criticised for having an executive chairman. James Packer held the role while being the company’s largest shareholder. John Alexander replaced Packer when the billionaire stepped down in 2018. Alexander is a close lieutenant of Packer’s who, until last year, received $3.5 million as a consultant to Crown.
Governance experts do not like executive chairmen. They prefer a non-executive chair and a separate CEO. This is because they represent the interests of all shareholders, not just the majority one.
Crown Forced To Close Melbourne Casino Until February 18
As if matters couldn’t get any worse for Crown, a COVID-19 outbreak forced its Melbourne casino to close. The Victorian Government imposed a five-day lockdown in Victoria, which came into effect at 23:59 on February 12. It lifts on 23:59 February 17.
All gaming activities ceased immediately. As did food and beverage, retail, banqueting, and conference facilities. Takeaway meals and meal delivery services are permitted, however.
Crown’s statement to the Australian Securities Exchange confirmed the hotel is operating at a reduced capacity.
Premier Daniel Andrews forced Victoria into a five-day “circuit-breaker.” Andrews hopes this will prevent the state from experiencing a third wave of the virus. A new variant of the COVID-19 virus, stemming from the UK, infects and spreads much faster than the first virus. This mini lockdown is designed to halt its spread before it gets a hold of the Victorian public.
“I know this is not the news that Victorians want to hear today. I know it’s not the place that we wanted to be in. However, we’ve all given so much, we’ve all done so much. We’ve built something precious, and we have to make difficult decisions, and do difficult things, in order to defend what we’ve built. I am confident that this short, sharp circuit-breaker will be effective.”