Aussie company shares sink on claims of billionaire CEO’s inappropriate behaviour

SYDNEY – WiseTech Global shares plunged on Oct 21 after the tech company’s board said it is reviewing media allegations against billionaire co-founder and chief executive officer Richard White of past inappropriate behaviour.

The stock closed down 15 per cent, the biggest decline in more than a year. The move wiped US$1.4 billion (S$1.84 billion) off Mr White’s wealth to US$8.3 billion, according to the Bloomberg Billionaires Index.

Mr White, 70, is WiseTech’s largest shareholder and has run the company since 1994, turning it into a global supply-chain powerhouse through a series of acquisitions. 

Nine Entertainment publications The Australian Financial Review, The Sydney Morning Herald and The Age said on Oct 21 that Mr White had paid millions of dollars to a former sexual partner to settle allegations made in late 2020.

The newspapers said Mr White had provided a board subcommittee with a statutory declaration denying the claims. The newspapers said they are not suggesting the allegations are true, only that they were made.

Media stories making various claims about Mr White’s personal relationships with women have swirled in Australia for the past three weeks, but the statement from WiseTech’s board on Oct 21 and the market reaction raises the stakes.

The company’s dominant shareholder – and the board’s governance controls – are now in the corporate spotlight for the first time.

“The board is currently reviewing the full range of matters raised in today’s media reports and is actively seeking further information and taking external advice,” WiseTech directors said in a statement.

“It is conscious of the potential impacts on the company and will carefully evaluate all relevant factors in its assessment.”

Oct 21’s stock slump cut WiseTech’s market value by about A$6 billion (S$5.27 billion) to A$35 billion. The stock has soared since its 2016 initial public offering, turning Mr White into one of Australia’s richest people. 

Only two current WiseTech directors were on the board at the time the allegations were made, and the company held a series of crisis meetings over the weekend, according to the reports.

WiseTech is a key provider of the software that coordinates shipping across the world. The Australian company claims the majority of the world’s biggest global logistics providers and freight forwarders among its clients, including DHL, China’s Sinotrans, Japan’s Nippon Express and APL Logistics.

The reports on Oct 21 also alleged that leaked communications from 2019 between WiseTech directors showed governance concerns over Mr White’s decision to pay a former female executive A$2.7 million, double what he was earning as CEO, without disclosing this to investors. BLOOMBERG