Sydney view: Good, the bad and the embarrassing

By GILES PARKINSON*

Statistics show that the Australian economy is one of the strongest in the world, but it wasn't immediately obvious to investors in the nation's big corporate collapses or the thousands of people who found themselves caught in the wave of cutbacks that accelerated after September 11.

The year was also remarkable, not just for the extraordinary events that occurred, but because many pundits got it right - at least in terms of where the financial markets would end up. Quite accidentally, of course.

In the corporate world, the year can be fairly easily divided into three camps, the good, the bad and the embarrassing. I'll let you decide which is which and who is whom.

fuxh Tall poppies

Lachlan Murdoch and James Packer got to keep their jobs, but plenty of others didn't after the spectacular collapse of One.Tel. Jodee Rich and Brad Keeling, a so-called dynamic duo, along with the chief financial officer and the chairman are facing securities commission charges.

The collapse revealed some juicy boardroom minutes - the trial should reveal even more.

Ray Williams, unheard of outside the columns of financial analysts before this year, became the public face of corporate greed after the collapse of HIH.

The collapse, estimated to have caused the evaporation of $A5 billion, will have ripple-effects throughout Australia, from higher registration fees for junior sport to home insurance costs.

Other high-profile businessmen can also expect their day, or weeks, in court - Rodney Adler for his role in HIH, Rene Rivkin over charges of insider trading in Qantas and the former CFO of Harris Scarfe over the retailer's sudden demise.

Chief executives

They come and go every year. But the revolving door included some interesting turns this year.

Dennis Eck, the former retail glamour boy for Coles Myer, found himself on a plane back to the US and replaced by John Fletcher, the taciturn former Brambles chief who hadn't been in a supermarket for more than 20 years.

For the first time, Australia has a top-20 company led by a woman executive, after St George appointed Gail Kelly as chief executive.

Nick Falloon took leave from PBL and was replaced by merchant banker Peter Yates. Gary Toomey left Qantas as a much-respected CFO and must still be wondering if that was a good idea. Andrew Forrest left Anaconda and Alan Jackson left Austrim, both in spectacular fashion

Other notable departees included Rod Chadwick (Pacific Dunlop), David Hearn (Goodman Fielder), Philip Weickhardt (Orica) and Tom Park (Southcorp).

Daniel Petre led a long list of dot commers to leave their buildings, although it appears he went on his own terms. Most of the others didn't have a business left to manage.

Heroes Woolworths' Roger Corbett, Westpac's David Morgan, Qantas' Geoff Dixon; Mayne Nickless' Peter Smedley (until he shocked the market and announced he preferred to be chairman instead) and Toll Holdings' Paul Little.

Waiting in the foyer: NAB's Frank Cicutto, Lend Lease's David Higgins, and WMC's Hugh Morgan.

Dealmakers The dual listed company merger: it was the expression on everyone's lips, but only because it was big and no one really understood what it meant.

BHP became BHP Billiton in a $A57 billion deal and Brambles Industries became Brambles plc in a $A20 billion deal with GKN. They look like mergers, act like mergers, and certainly pay the fees of a merger.

The best deal award went to Macquarie Bank for the way it structured the Macquarie Infrastructure Trust.

The manager gets a percentage of the market capitalisation, and will pocket $A70 million a year for the next three years. Nice work if you can get it.

A golden hammer goes to Robert Champion de Crespigny for services to the auctioneering industry after convincing AngloGold and Newmont Mining to up the ante in their fight for Normandy. Whoever wins will be paying at least double the Normandy share price of six months ago.

The future

It lies in thongs, T-shirts and boardshorts. Just ask Gary Pemberton.

The surf-loving former Brambles and Qantas chairman heads Billabong International, which was once again one of the best-performing stocks on the sharemarket.

James Strong, another outdoor type, with particular interests in climbing and hiking, has spread his interest to the water with the chairmanship of Rip Curl.

And, of course, infrastructure.

In Australia you can't go to the beach, the mountains or even across a bridge without paying a toll. And almost none of it is going to the Government.

Safe investing in the New Year.

* Giles Parkinson is editor of AFR.com.