Qantas May Soon Find Themselves in Search of a New CEO.
Amidst speculation that Qantas might need a new CEO, the airline’s board must approve a huge paycheck for Alan Joyce. The quest was revealed to the world right as shareholders were asked to vote on the pay package, rousing interest in whether or not there is a succession plan in place when Joyce leaves. Joyce was one of the pioneers in what is today known as low-cost carrier airlines. And though 15 years with a single airline is admittedly a long time, and though Joyce has proven his worth before, I’m sure shareholders are concerned about the airline’s performance this year. When you make $1 in your bank account for 6-8 weeks almost every month, it seems unjustifiable. Joyce was entitled to $8.86 million as part of a retention scheme in February, which aimed to keep him at the helm of Qantas. The scheme also entitled Joyce to more than 688,000 shares worth UAD$4 million. As part of the plan, Qantas promised to cut $1 billion of expenses from operations by year-end and return at least an airline part of its association with oneworld. Joyce, Qantas’s new CEO, is on track to achieving the company’s financial goals. However, it seems like Qantas may have suffered a negative reputation as a result of these operational difficulties. Jetstar and several other airlines have dealt with similar problems in recent months. With Australia standing as one of the world’s largest economies, it’s only right that companies have their priorities in order. After seeing executives get a whopping 14-fold salary increase, shareholders and other stakeholders are understandably questioning what Qantas is doing with their hard-earned money. The CEO of the Australian Shareholders Association Rachel Waterhouse confirms this by saying that: “Qantas Chairman Leigh Clifford is right and CEOs have raised some eyebrows.” “The organization has relied on one individual for some time now, and investors will want to know who is in the wings and what they’re capable of if this person can’t deliver the targets. Aside from who will take over when the departure happens there will also likely be long-term changes such as who’s involved with acquisitions going forwards.”
Joyce’s potential successors wereThe Airline industry is a tough market to find success in. With such high demands made by investors, it can be difficult for a CEO to make lasting changes for success. As we continue to search for a suitable successor, Qantas Chairman Richard Goyder has come out with his opinion that Jane Hughes should leave by the end of 2020 as she is stepping down from her commitment. But there also remains a chance that Jane might leave sooner given recent events and shareholders lack of confidence in her ability to lead the company into future success. With a history of sourcing candidates internally, the only company Jetstar would advertise externally for Joyce’s successor is Virgin Australia. Unfortunately though, one of the airline’s top candidates, Gareth Evans, will not be joining the campaign as he is stepping down from Jetstar in December and leaving the Qantas Group formally in 2023. The airline has several internal leads for the top job, including Vice President of Operations and Chief Financial Officer, Vanessa Hudson. The airline has tried to retain some of their strongest executives from before the scandal, so it’s supporting current CEO Alan Joyce as an advisory board. Other candidates include Head of Qantas Loyalty, Olivia Wirth and Maxine Brenner from the company’s board of directors. Jacqueline Hey also joins the Advisory Committee.
Bottom lineWhen a new CEO is chosen to lead Qantas, a refreshing trend seems to be taking place. The majority of the candidates are female, which makes it quite evident that there has been a significant amount of change for the company. What’s more is that if a woman were to be elected as CEO, she would undoubtedly be the first in Qantas’ history and is likely what this business needs in order to regain the trust of their passengers.