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Richard White steps down as WiseTech CEO
Billionaire Richard White will step down as chief executive of WiseTech following a series of damaging allegations made about his conduct.
His resignation follows a joint investigation by The Australian Financial Review, The Sydney Morning Heraldand The Age.
It also uncovered that White paid for a multimillion-dollar house for one of his employees which he was in a seven-year relationship with, and had been accused by an outgoing WiseTech director of intimidation and bullying.
“The board has agreed, following Mr White’s request, that he will stand down as a director and as CEO with immediate effect, take a short period of leave, and transition into a new role with the company that he founded and has led for 30 years,” WiseTech said in a statement after the market closed on Thursday.
“When Mr White returns from leave, he will commence a new full-time, long-term consulting role, focused on product and business development.”
The outgoing chief executive is also exiting the WiseTech board. White has run WiseTech since 1994 and has considerable influence as the company’s founder, chief executive and largest shareholder. The logistics software business floated on the ASX in April 2016, valued at about $1 billion. It now has a market capitalisation of $32.3 billion.
WiseTech shares have plunged 20 per cent since this masthead’s investigation was published.
White will remain with WiseTech in a consulting role under a 10-year, $1 million per year deal. The agreement requires two years’ notice to terminate any earlier than its full 10-year term. But less notice is required if there has been misconduct or a material breach of the agreement’s terms.
The board said it had hired law firms Herbert Smith Freehills and Seyfarth Shaw to review the revelations in the The Australian Financial Review, The Sydney Morning Herald and The Age’s investigation.
WiseTech chief financial officer Andrew Cartledge will take over as interim chief executive.
White claimed he and chairman Richard Dammery have been discussing succession planning for some months.
“I strongly believe that now is the right time for me to make this transition and the board agrees. This new role will allow me to focus on product and business growth, to create even greater value for shareholders and customers over the long term,” he said.
However, just last week, White claimed he was “fully committed and laser focused on delivering WiseTech’s strategy”.
Dammery said it has been a challenging time for staff.
“We acknowledge this and have put in place additional support. As a board we are highly engaged and focused on completing our review to support the business’ continued success,” he said.
“As WiseTech continues to grow, and becomes increasingly international, the board recognises that its governance practices will also continue to evolve. We are taking a fresh look at what we are doing well and what we can enhance.”
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David Swan By David Swan October 24, 2024
Tech billionaire Richard White’s resignation will likely do little to arrest his company’s plummeting share price, and the wider technology sector now has serious questions to answer about how it allowed his alleged behavioural problems to fester.
White stepped down as CEO of WiseTech Global late on Thursday following a string of reporting by this masthead into allegations of inappropriate behaviour. The Age, The Herald and the Australian Financial Reviewrevealed that White, one of Australia’s wealthiest men, gave, or allegedly promised to give, two multimillion-dollar houses to women with whom he had a sexual relationship.
A third property, for another woman, came to light during a separate Federal Court brawl that ended in a settlement earlier this week.
The billions in lost value, carved off the fortunes of both WiseTech Global and its long-time leader, all stem from a dispute between former lovers over $90,000 worth of furniture.
White said late on Thursday that he would resign effective immediately and transition to a new role.
White’s resignation was all but inevitable, and his position was untenable given the mounting allegations of misconduct. But Morningstar equity analyst Roy Van Keulen believes the departure can further cripple WiseTech’s share price, given how integral White’s specialist knowledge has been to the company.
White had humble beginnings as an AC/DC guitar tech and member of a small-time glam rock band, but grew into one of the most powerful individuals in Australian tech.
“We estimate that the replacement of White as CEO would lower the value of WiseTech shares by around 20 per cent to $90 per share,” Van Keulen wrote on Thursday. The shares had already dipped below $100 before the White’s resignation was announced, having started the week at $122.
“We think WiseTech has been managed exceptionally well by its founder and CEO, Richard White. WiseTech has secured a dominant position in international freight-forwarding software, which is an inherently globally competitive market. We attribute this success to a rare combination of planning and execution.”
And White’s behaviour has roiled not just WiseTech but the broader technology sector. White was a board member of the Technology Council of Australia (TCA), a high-profile lobby group, which on Thursday announced that he would leave the board. He is also a philanthropist, donating regularly to coding education programs and “diversity in tech” initiatives.
And there are questions now about how much power White will still wield at the company he founded 30 years ago.
He will take on a “full-time, long-term consulting role, focused on product and business development”, with a title of “founder and founding CEO”. White’s new role could arguably be more influential than that of the CEO, who usually has to report directly to the board. As WiseTech’s largest shareholder, the board will now effectively report to him.
The unwinding of White’s influence will take longer than his resignation, and the broader sector has yet to reckon with how the alleged misbehaviour of him, and others in the industry, have continued for so long.
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