Elders Is Hiring More Directors But Cutting Their Pay Amid A Fraud Investigation And Restructure


Rural services group Elders is looking to hire more directors to help improve safety, efficiency and capital management after a nightmare year.

Chairman Mark Allison told shareholders at Elders’ AGM this morning that the company was recruiting two non-executive directors, as well as a chief executive to replace outgoing CEO and MD Malcolm Jackman.

The additional directors are to join non-executive directors Hutch Ranck and Josephine Rozman, and non-executive chairman Allison on the board.

“We are seeking to add to the depth of financial management and agribusiness experience on the board,” Allison said.

“The increase in director numbers is driven by business needs and we are mindful that the board structure and cost be appropriate for the company.

“Accordingly, we will be seeking to reduce the remuneration pool from the current level of $1.8 million approved by shareholders at the 2006 AGM – when the company had 9 directors – to a level that is aligned with current business requirements.”

Allison said his own pay would remain unchanged, as he took on additional duties while Elders sought a new CEO.

Elders has had a difficult few months. In October, it kicked off a forensic investigation into accounting discrepancies in 2012 and the first half of this year. The alleged fraud was worth about $24 million.

It told shareholders this week that it had identified “a handful of individuals who were then employees of the trading business unit”, improved its reporting systems and would call in authorities where applicable.

Elders posted a statutory loss of $505.2 million in the 2012-13 financial year. It has a market capitalisation of about $48 million.

Shares were down 4.55% to $0.105 just past noon.