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Million-dollar bonus, governance concerns at Brien Holden

05/09/2018By Matthew Woodley
Questions have been raised about corporate governance practices at the Brien Holden Vision Institute (BHVI) following the decision to award a significant bonus to a long-serving staff member under a vague approval process.

The issue was first raised earlier this year when an anonymous letter, signed by “concerned staff” was sent to BHVI’s chairman, Professor Brian Layland and then-CEO Professor Kovin Naidoo, questioning the appropriateness of a “substantial bonus” and requesting an investigation. Numerous sources have since confirmed to Insight that the bonus equated to around $1 million.

The staff letter asked Layland, “How can this be fair to the rest of us or correct for a charity organisation that has little money?”

Insight understands that the letter was sent to various media outlets including the Sydney Morning Herald. It’s unclear whether all board members and senior management were informed of the magnitude of the sum or were consulted prior to making the payment.

Naidoo advised that he knew nothing about the payment, a fact that Layland confirmed because, according to Layland, the bonus was approved “five or six years ago”.

However, Layland refused to confirm the bonus amount, saying it was “nowhere near” $1 million, nor who paid it if it wasn’t the then-CEO Naidoo or himself as chairman. His only comment was that the bonus figure was a commensurate reward given the amount of royalty income the staff member had secured for the institute, and in his opinion it was not “a big deal”.

Insight contacted current BHVI CEO Ms Yvette Waddell, who was the chief operating officer at the time of the payment, for clarification however she did not return numerous phone calls.

Concerns about whether the six-year sequence of events and the enormous staff bonus represented transparent and sound corporate governance led Insight to refer the matter to the Australian Institute of Company Directors (AICD).

If the $1 million bonus was paid in the second half of 2017, as Insight understands it was, it would have been made in the wake of a financial year in which BHVI recorded an operating loss of $2.64 million on a turnover of $17.8 million, which had fallen from $30.75 million the previous year.

AICD forwarded the matter to leading governance consultant and professional company director, Ms Julie Garland McLellan, who said she had serious reservations concerning a number of processes that had supposedly been undertaken in the lead up to the bonus payment.

More information on those concerns, as well as a comprehensive breakdown of the timeline surrounding the awarding of the bonus, along with comment from former CEO Professor Kovin Naidoo are detailed in the full magazine story here.

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Editor’s note: Insight in no way implies that the recipient of the bonus acted inappropriately in the lead up to, and upon receiving the payment. Issues highlighted in the story refer to governance, rather than the merits of whether the bonus, or its size, were justified.

Further articles:

Million-dollar bonus at Brien Holden sparks board governance concerns

Revelation: Brien Holden chairman wrong

BHVI chairman wrong about million-dollar bonus, more governance concerns emerge

Brien Holden Institute chairman resigns

Brien Holden Institute "missing" $1 million questioned

BHVI Foundation removes CEO amid maladministration investigation

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