Star Entertainment, an Australian gambling and entertainment company, is undergoing major changes to its leadership team. The company will see a revamp of its board of directors.
Analysts Critiqued O’Neill’s Increased Salary
Following the leave of ex-CEO Matt Bekier, John O’Neill, a former rugby star and chairman of Star, stepped in the shoes of a managing director and chief executive officer. The company promised that board changes are coming soon:
“While the board considers it critical that the company has stability in this transitional period to a new managing director and CEO, it acknowledges the need for accelerated board change.”
Critics have pointed out that O’Neill, now holding three significant positions within Star Entertainment, will earn close to $1.5 million (in US dollars) a year. They argue that this money could instead be put into improving the company’s business. While O’Neill will serve as a CEO only temporarily he will still cash in on the company’s turmoil.
Kolesnikoff Spoke About O’Neill’s Salary
Bekier resigned from Star Entertainment after the company was accused of knowingly breaching the country’s regulations on money laundering amid other crimes. His leave will greatly benefit O’Neill’s annual salary, which has led industry analysts to scrutinize the decision.
Vas Kolesnikoff, executive director of the advisory company ISS, analyzed the situation in an interview with WAToday. He pointed out that O’Neill will likely get removed from the company during the ongoing shakeup. Kolesnikoff added that the ex-rugby star has served as a chairman for a decade and yet has done nothing to prevent the money laundering scandal. However, even if this were to happen, it will not prevent O’Neill to get a big paycheck before leaving.
Kolesnikoff compared the situation with what had previously happened with Crown Resorts where almost the entire leadership team got stripped of their titles.
Star Entertainment Needs to Change to Regain the Public’s Trust
Star Entertainment has gotten itself into quite the trouble. The company was accused of money laundering, foreign interference, crime and fraud, following intense investigations. Several of the operator’s venues had been used for illegal gambling activities in breach of Australia’s regulations.
Star was also accused of letting fraudulent activities by Suncity Group slide and choosing to turn a blind eye to the wrongdoings. Even when Angus Buchanan tried to write a report in 2020, the operator defended Suncity and submitted a version that understated what was happening.
Because of its transgressions, Star Entertainment risks losing its operator’s license. Many expect the company to undergo significant reshaping of its board if it wants to regain the trust of the regulator and the respect of its customers. Following the refresh of its board of directors, Crown Resorts managed to mitigate some of the damage and see a recovery of its business. The company is now set to be acquired by Blackstone in a $6.5 billion deal. It is interesting to see if Star Entertainment will be able to replicate Crown’s recovery.