Finance Finance News Money vs morals: why Woolworths is holding on to its poker machines
Updated:

Money vs morals: why Woolworths is holding on to its poker machines

Supermarket giant Woolworths also has a vast poker machine empire
Share
Twitter Facebook Reddit Pinterest Email

Woolworths chairman Gordon Cairns has vowed to act on reports that employees of the retail giant’s $1.5 billion gaming and pubs division are collecting, sharing and using gamblers’ personal information to encourage them to spend more time – and money – at their poker machines.

“I am determined as the chairman of Woolworths … that we will get to the bottom of this. If the allegations are true, then we have let ourselves down,” Mr Cairns told Fairfax Media.

Mr Cairns, chairman of Woolworths since 2015, is a straight shooter and widely respected as an ethical business leader.

The most pressing question for Mr Cairns is not what is he going to do about these troubling revelations – brought to light by whistleblowers and anti-pokies federal MP Andrew Wilkie – but why is Woolworths even in this business?

The immediate answer: money, lots of it.

ALH Group, a Woolworths majority-owned business, is a joint venture with pokies billionaire Bruce Mathieson. The network of 323 pubs and licensed venues control 12,000 poker machines nationally. ALH, which also includes 537 retail liquor outlets, last financial year produced $1.55 billion in revenue or 10 per cent of Woolworths’ annual turnover.

But the question remains: why is Woolworths, the company represented by a wholesome green apple, involved in this pernicious business?

Woolworths poker machine
Woolworth’s pokies are contributing to the bottom line. Photo: AAP

We can believe Mr Cairns when he says he is disappointed by allegations that heavy users of poker machines in his venues are encouraged to spend even more money on the machines.

But one’s sympathy can only go so far. The pokies business is not benign. It is premised on gamblers sinking far more into machines than is paid out. It is a business that knows it is a breeding ground for problem gambling and pokies addiction.

It is a business vastly at odds with everything Woolworths stands for as a corporate citizen.

“At Woolworths Group, corporate responsibility has always been about doing the right thing,” the company states on its website.

“[W]e are part of the fabric of society. …We understand our responsibility for creating a better tomorrow.”

Problem gamblers and their families have little prospect of a better tomorrow. And if they do it is no thanks to Woolworths and its 12,000 poker machines. Mr Cairns must be aware of the wreckage left behind by the worst-afflicted problem gamblers: spiralling debt, broken families, homes repossessed, even suicides.

Mr Cairns, left to defend the indefensible, insists Woolworths is “very, very clear about our social licence to operate” and takes seriously its role as “responsible custodians of gambling”.

In 2017, ALH engaged the Responsible Gambling Council of Canada to conduct an audit of the company’s “responsible gambling programs”. The audit will now include the whistleblowers’ allegations.

“You may have your views on pokies, good or bad, but at the end of the day, if we can have objectively validated that we are the most responsible custodians of gambling, then that will satisfy … [the] general public out there that have concerns,” Mr Cairns says.

It’s a viewpoint shared by a former Woolworths CEO Roger Corbett, which is hardly surprising. He headed the retailer from 1999 to 2006 and spearheaded the original merger with ALH. He is now the chairman of ALH.

Mr Corbett, a prominent company director, is perhaps best known for his train-wreck interview on the ABC’s 7.30 program last year in favour of the marriage status quo.

Woolworths, which supported same-sex marriage, immediately disassociated itself from Mr Corbett’s stance.

It would do well to consider doing the same with Mr Corbett’s equally tone-deaf assessment of the pokies status quo.

“The law of the land allows poker machines and we are absolutely committed to being the best operators of poker machines in Australia,” he said.

Like drinking, like eating too much food, people can make a choice.”

This insensitive assessment betrays a lack of understanding of problem-gambling as an addiction. By Mr Corbett’s logic Woolworths should introduce its own brand of cigarettes.

The most positive contribution that Gordon Cairns can make to community wellbeing and good corporate citizenship is to take Woolworths out of the pokies business.

On the question of whether Woolworths remains committed to the ALH joint venture, Mr Cairns is unusually circumspect.

For now, he says, “My sole focus is on making the partnership the strongest it’s ever been.” But he also allowed that “circumstances change, partnerships wane”.

Perhaps Mr Cairns is quietly weighing up the pros and cons of the ALH partnership.

 

Comments
View Comments