Thursday, 7 June 2012

Ownership

I caught up with an old fishing friend the other day who happened to be in town.  A lovely fellow, he endeared himself to me even further by making complimentary remarks about this blogsite saying how he liked the writing style and one or two of the anecdotes.  However (there is always an however), knowing how opinionated I can be when among friends, he wondered whether I was ever intending to make use of this apparently newly discovered talent to voice a few opinions of my own.
The problem here friends, is that I do have a few strongly held views, and am not above sharing them over a glass of quality red, but some of them may not always be the same as those held by colleagues and business associates; and opinions, contentious or otherwise, once aired in a forum such as this, have a habit of staying around for a long time.  OK, maybe I am being just a bit theatrical and pompous, but there it is.
So you are unlikely to hear me sounding off about my political proclivities, or my views on abortion and gay marriage (ok, I'll give you that one - I'm with Clint Eastwood on the gay marriage bit) - nor am I likely to enter into a debate on religious convictions.
However, there is one issue which has been bugging me for a long time, which I need to get off my chest - and that concerns this whole Australian-owned thing.
Recently I changed address, and in so doing decided it was a good time to combine our supply of gas and electricity under the one provider.  Now there are no doubt many providers of these services in the town where I live, but of the two suppliers who seem to have most of the market, one is an Australian company listed on the Australian Stock Exchange and employing about 2,000 staff.  The other is owned by a Chinese public company and of its 6,000 employees, about 1,000 of them are in Australia.
The argument, subsequently placed before me, was to question why, all others things being equal (which of course they never are), I would choose as my service provider a company which was foreign owned and which would thus export all of their profits off shore - to China no less. 
Now here's my point.  Why does it matter, whether the shareholders of these companies acquired their stock in Hong Kong or Australia.  I have no way of knowing where they actually call home.  The Australian company's top twenty shareholders (about 40% to 50% of all the shares in the company) include HSBC Nominees, Citibank Nominees and several other overseas owned shareholder funds.  As an aside, it is worth noting that our big four Australian banks also number several overseas owned shareholder funds among their top shareholders - and why shouldn't they?  Our Aussie banks are established, well regulated, sound conservative investments and contribute a lot to why Australia has such a solid and stable economy.  If I were an overseas investor, looking for a safe haven for my money, and were given the choice of an American, a Scottish or an Australian banking institution, I don't think I would have to go to Robert Gottliebsen or Alan Kohler to help me decide!
No my real point, is that both of these organisations employ significant Australian workforces - and that, to me is what is important.
When I hear this buy Australian-owned winge, my mind goes back about fifteen or twenty years to when French and British companies first began to take an interest in Australian water infrastructure projects and waste management operations.  I was working for an Australian owned engineering company at the time, which has since been acquired by a large US group, and continues to thrive as a global business with Australian managers from that business now working on major projects all around the world.  I attended a presentation at the offices of one of the major municipal water authorities.  The briefing was being held for companies interested in participating in the building and operating of water treatment plants which would meet the State's objective of enhancing the quality of drinking water in its major city.  Most of the major construction companies were there: Leighton, Transfield, Concrete Construction, Lend Lease and many others.  There were also many international water groups present, including Thames Water, Yorkshire Water, and the French companies of Veolia and Suez (although they were known by different names then).  During the briefing, one of the local Australian manufacturers asked the question, "Why do we need to buy from the British and the French when we have perfectly good local technology here in Australia?"  I will never forget, the impromptu response from the fellow who was there on behalf of one of the major international companies.  He was (and is) a well known Australian engineering manager, who had been on the construction contracting scene for many years.  He leaned back in his seat, looked back over his shoulder at the questioner and said in the strongest Aussie accent, "Do you mean Frenchmen like me?"  
This is what is at the heart of the issue.  It was of course, a perfectly reasonable question for the local manufacturer to ask, but if we are going to continue to participate as a global economy (and we clearly have little choice in this unless we revert to the old ways of restrictive, mind-numbing protectionist trade practices), then we must recognise that the best option is to participate and share our innovation and ingenuity with the world.
A few years ago, I was one of about 3,000 local employees working for a French-owned waste management company and there is absolutely no doubt that our ability to provide a high quality sustainable resource recovery and management service was enhanced by our access to global resources and technology, and global research budgets.
So I don't support the hypocrisy of "Australian owned", particularly while we are so keen to export our own products and innovative ideas, and sell our own resources into the global market place.  I will support local manufacture, (why would we want to buy our cheese or our wine from anywhere else - except perhaps New Zealand occasionally), but please don't send anyone knocking on my door, asking me to buy Australian owned products because I'm not sure that I will believe it anyway.

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