Woolies pokie gambit fails, but PR effort a winner
Woolworths chairman James Strong would have seen the defeat this morning of the resolution to put further curbs on its 12,000 electronic gaming machines as a good indication that its poker machine business is yet to impact on the company's wholesome image as a family friendly grocer.
The final vote was 97.47 per cent against the resolution that would have, among other things, limited bets on the pokies in its pubs to $1.
The defeat was never in doubt after proxy advisers, and the Australian Shareholders Association, recommended against the resolution put to shareholders today in an extraordinary general meeting.
But victory was probably never the intent of the investors who convened the meeting, backed by activist group Getup.
That would have required a vote of at least 75 per cent in favour of the resolution and was never on the cards.
What they did achieve was to put Woolworth's board under its most intense examination to date to justify why Australia's largest supermarket operator needs to also be our largest owner and operator of poker machines.
Whatever the board says in public, it is a damaging association for the company and a major distraction from its core business, according to one investor.
For more than 90 minutes the board faced questions about its strategy, and had to publicly face the ugly side of the poker machine business.
One Sydney mum spoke of her husband taking his life over the despair of his addiction.
He played at machines owned and operated by Woolies.
"Now you recommend that shareholders vote down these sensible reforms. Before making that decision, I would like to know if you know how many gamblers at your venues have taken their lives?"
Whether fair or not, this is the sort of image that will stick in the minds of consumers, not pleas from Strong that it is unfair for the company to be subject to restrictions that don't apply to other operators. Or, his point that the "mish mash of conflicting reports" have failed to present a coherent strategy on managing problem gambling.
And while Woolworths makes the point that it needs hotel licences in many states to operate its highly successful $6.6 billion liquor business, it is not entirely clear why it then needs to own and operate the poker machines in them.