Over To You, Mr Wallace
- 20 December 2013
The votes are in, the results are known and the status quo remains. The nominee directors have apparently failed to convince enough of the large institutional investors that change is needed and we now face at least an immediate future with the men who had already been appointed to the board. There is no question that the appointment of Graham Wallace has been a major factor in the board being successful en masse. Had the EGM gone ahead it is very likely that none of the old board would have survived. To suggest that Wallace's credibility has rubbed off on them would be a major understatement, but with that vote of confidence comes a large responsibility and it is a responsibility that he should be well aware of given the extremely hostile reception the board received from shareholders who attended yesterday's AGM.
It was clear from the start of the meeting that this was not going to be an easy ride and if any of the new or old board members were under any illusions about the task facing them then they should have been set straight. A cacophony of boos rung round the Bill Struth Main Stand as soon as they were announced and continued at various points throughout, particularly when Brian Stockbridge deflected question after question. The shareholders may have been convinced but it is clear that supporters have not and that is the main issue now facing Wallace and this board – one which, to be fair, he openly acknowledges. So where now?
Well if it was not obvious to him when tens of thousands held up anti-board red cards at the recent home game, then it should be obvious now that there is a major trust issue. Put simply, the continued presence at the club of Brian Stockbridge may be acceptable to a majority of shareholders but it is not acceptable to over a third of them and it is totally unacceptable to the vast majority of the fan base – even those unconvinced by the nominee directors.
Stockbridge was again evasive. His attempt to breakdown the ridiculously inflated IPO costs was telling. He first attempted to fudge the issue, as he has done previously, but when pushed by further questioning he was finally forced to give some specifics. Well, almost. His throwaway comment that there were £2.5m of costs related to "financial advice" was met with more boos and calls for his resignation from an angry crowd. It is increasingly clear that it is a question he cannot or will not answer. As one experienced finance professional commented during his question, the money has "disappeared into a black hole". It is notable with regard to Stockbridge that those most disgusted with him are people who have the experience and expertise to know how he should be performing.
David Somers also made an odd contribution. He seems like a perfectly pleasant gentleman and his opening statement, under some pressure after the board's welcome to the stage, was reasonably delivered. Had the remainder of his contribution been provided by a bumbling great uncle around the fire at Christmas then it may have been quite charming and entertaining. However, he isn't and it wasn't. This was not an occasion for levity and his attempts to make light of several very serious issues were ill judged. He almost got away with answering a question about the continued, and expensive, involvement of Jack Irvine at the club but then, instead of quitting while he was ahead, started to try to justify his presence.
Someone should really have told him that we've already had the line from Craig Mather about Irvine apologising to John Greig. We don't care. He should also stop repeating the absurd line that he wouldn't know Green or Whyte if he passed them in the street. If that is the case then he should quickly get a hold of some photos and if he does pass them then perhaps he could ask them for our money back. If Somers is going to have a long term future at the club he will need to quickly acquaint himself with the issues which the support are not willing to negotiate on.
Norman Crighton did not make a large contribution but he did confirm that Laxey partners had suggested him for the role. Quite why Colin Kingsnorth of Laxey felt the need to deny this at a recent meeting with fans is beyond me, as it had been assumed that was why he was there anyway and there is no real issue with them having someone on the board given the level of their shareholding. Crighton's other contribution was a failed attempt to justify the continued mystery surrounding Blue Pitch and Margarita which was not well received.
The Easdales said very little but there is continued, if not insurmountable, unease over their relationship with the block of shareholders whose proxies they hold. Despite several interviews and public appearances there is still no clarity on that shareholder block or quite how they came to represent them. It also remains to be seen when the Easdales will take possession of Charles Green's shares.
There were positives however. Wallace is an impressive figure and was clearly the most popular board member. He speaks well and appeared unruffled by the hostile reception – perhaps knowing it was not particularly directed at him. If he is truly free from outside influence then he has the credentials and experience to make a good contribution to the club. Ally McCoist also delivered a rousing speech and did well to focus on the football operations alone. He markedly avoided any kind of endorsement of any board member aside from Wallace. He did not deserve to have to stand on a stage beside people receiving the kind of reception the board did but I'm sure he will be well aware that none of it was directed at him.
Which brings us back to where we started – trust.
There is not a fan, whether shareholder or non shareholder, who has any wish to withdraw financial support for the club we all love. However, as was seen with today's vote, until fans embrace the purchase of more shares through schemes like the RST's BuyRangers, we have no other means to voice displeasure. The club needs the fans' money, the fans want to give them it - there should really be no need for any issues but a tipping point was reached with the most recent financial betrayal.
With that in mind I would suggest that Mr Wallace can make it easy for everyone. He should, as a matter of urgency, remove Mr Stockbridge from his position. His shareholder support, despite some inaccurate commentary to the contrary, was far from overwhelming. In contrast, his toxicity to the fans is utterly overwhelming. If there is even the remotest possibility that his presence could make a significant number of fans decide to withdraw financial support – and there is - then he should go. He has not performed well, he is overpaid and he has become too high profile for people to forget about him. A well performing executive should expect to be supported by 90%+ of shareholders so he is far from secure on that count either.
Jack Irvine is the other easy win for Graham Wallace. I think we are seeing a theme here but he is overpaid, underperforming (for the club at least) and he will cause unrest with his continued presence. He has historically failed the club and continues to do so today. His talents, such as they are, have never been directed for the good of the institution but rather individuals controlling it.
Removals are not enough though. Until trust is built long term with the new board members, there is a need for the appointment of people who have already got unconditional trust from the fans. These people are few and far between but Dave King represents not only a trusted individual for the support but also a major source of finance. King has suggested Paul Murray as another appointee and I would obviously endorse that view even if some others would not. Murray got an excellent reception from shareholders today, as did the other nominees, and it is quite clear that some of the animosity which appears to exist for him online does not manifest itself in large groups of Rangers fans in the real world.
The issues which Rangers faced yesterday still exist today. The club needs to raise money. It needs the fans to trust those running the business again and, as I've written about in this month's WATP magazine, it needs everyone pulling together in the same direction. We can be a force again so why not make the simple but required changes and create the conditions for that to happen? There is no real excuse for Graham Wallace and the other board members not to step up to the mark. Trust is essential and they can make it easier for themselves with minor changes which should also by default improve the club's financial and PR functions.
There are some signs they are listening. They have committed to better engagement with fans and Mr Somers also appeared to accept the main principles of the proposed Rangers Constitution. But words are not enough – we've been here before. Real trust will be earned by actions and any attempt to fudge the issues that exist with Stockbridge and Irvine will see any goodwill and time which Wallace is currently being given quickly erode.
There is an opportunity here for Graham Wallace to show that he is a leader. He wanted a CEO role and he has got one. He has got a good majority of shareholder support and he's got the fans tentatively onside. If he doesn't rest on his laurels then he can turn this into a positive for the both the club and himself but he needs to act. Let's hope he does and let's hope that in the next month we see the changes needed to put all our minds at rest. There is no reason for it not to happen but any failure to address these important issues could quickly have the alarm bells ringing again.