Harvey Norman chairman Gerry Harvey suggested a shareholder activist standing for election to the Harvey Norman board might be a “sexual predator” during a heated AGM at which the company avoided a board spill despite a second strike on executive pay.
Long known for aggressively defending his anachronistic management style, Mr Harvey wielded the term against Stephen Mayne, who was running for the board of a company he has accused of using secretive and opaque business practices, making poor investments and lacking independent directors.
The 80-year-old Mr Harvey had already railed against “agitators” including Mr Mayne at Wednesday’s meeting when Harvey Norman’s remuneration report was opposed by 47.6 per cent of shareholders, well above the 25 per cent needed to force a vote on whether to spill the board.
“There’s this movement out there with agitators who are against anything we do,” Mr Harvey said on Wednesday.
“The family business doesn’t exist as far as they’re concerned.”
When time came for Mr Mayne’s ultimately unsuccessful election bid, Mr Harvey pulled out a pre-prepared spiel that included reference to an article Mr Mayne wrote 18 years ago ranking female politicians in terms of physical attractiveness.
“Are you are sexual predator?” Mr Harvey asked Mr Mayne in front of a crowded meeting room at Sydney’s Tattersalls Club.
Then, while addressing the audience: “No … he’s not?… or he’s not admitting to it?”
Mr Mayne, who has since apologised for the article, was not allowed to respond or speak to the motion.
After the meeting, he called Mr Harvey’s attack an “unhinged slur”.
“I’m not going to litigate … but it is very disappointing he chose to make it personal instead of addressing legitimate governance concerns,” Mr Mayne said.
“He’s the worst in the market for governance and he’s only proved it here.”
Wednesday’s motion to spill the retailer’s board was voted down by 88.8 per cent of shareholders.
Mr Mayne received just 8.18 per cent of proxy votes in his favour before just 11.2 per cent voted in favour of a spill meeting.
The Harvey Norman board has had only two new members since 2005.
Mr Harvey’s wife, chief executive Katie Page, was re-elected with 91 per cent of shareholders voting in support.
Harvey Norman directors Ken Gunderson-Briggs, Maurice John Craven and David Ackery were also re-elected to the board, though the latter’s bid was opposed by 28.38 per cent of proxies.
Wednesday’s meeting came after Harvey Norman revealed its Australian business has been its second-worst performing unit so far this financial year in terms of sales growth.
Australian franchisee comparable sales for the four months to October 31 were just 0.4 per cent higher than a year earlier.
That compares to a 1.7 per cent rise across the whole business, with only Singapore – where sales fell 8.1 per cent – performing worse.
The sluggish local sales growth was announced a day after Australian consumer confidence was shown to have slumped to a four-year low following a clutch of gloomy economic data.
Three Reserve Bank rate cuts since June and federal government tax rebates have failed to stimulate consumer spending, with retail sales growth slowing to a seasonally adjusted 0.2 per cent in September from 0.4 per cent in August.
Northern Ireland, Slovenia and Croatia, and Ireland all showed comparable sales growth of more than eight per cent, with New Zealand not far behind at 7.7 per cent.
Malaysia, the remaining territory in which Harvey Norman is active, showed 4.2 per cent growth.
After an early drop on Wednesday, Harvey Norman shares climbed through the meeting and vote on pay, before falling again after the spill motion failed.
Shortly before the close, they were 0.35 per cent lower at $4.305.