EXTRA >>

THE Medical Research Commercialisation Fund’s (MRCF) current third round of capital raising has not just shifted the goal posts for biotech innovation in Australia, it has widened them substantially. It is a paradigm shift according to MRCF chief executive, Chris Nave.

It is still possible to miss, according to Dr Nave – and it is his job to “try to make these companies fail” because the ones that make it are likely to be big winners – but now innovative Australian biotech start-ups have a much greater chance of scoring. And scoring big, internationally. 

That’s because, for the first time, Australia’s superannuation industry is properly engaged with the fund to provide substantial financial backing to the biotech innovation sector.

In the past, Dr Nave said, the $3 trillion Australian superannuation industry did not consider the sector a safe-enough option for superannuation investment. However, the involvement and support of most Australian state governments over recent years, matched with some major success stories and financial returns from start-ups fostered by the MRCF program, has changed everything.

“We realised in the medical research sector that if we had a cardiologist or a clinician like Daniel (Timms) with a great idea (the complete artificial heart, BiVACOR), we had no ability to support the funding even to get the patents, let alone take it from the laboratory through to a development stage that either a pharmaceutical partner would come in to support it, or whether a traditional investor would come and support it,” Dr Nave said. “So what happened was a lot of our IP was being lost.

“The MRCF was set up to try and fill that funding gap. We went to a bund of research institutes and said, we want you to join a venture fund. If you join the fund, I’ll be able to raise the money. But if you join you have got to give us first right to review your opportunities.

“I went to the super funds and said I’m going to get some great institutes to join, if you give us money, they’ll give us first right to look at their opportunities.”

“We don’t just invest. We help establish these companies, we help put management teams around them … often we are the management team for the first two or three years while we are doing crucial experiments.

“We basically have every major medical research institute and every department of health in Australia as a member now,” Dr Nave said. “The most powerful thing is that we bring every one of these organisations together every six or seven weeks. They send a representative to that meeting.

“It probably sounds like an unwieldy meeting, but it functions incredibly well. It is the only initiative in Australia that brings together all of the clinical and medical research capability on a regular basis,” Dr Nave said.

“Normally, as we know, everyone is in their silos, busily researching away a applying for grants and competing for grants. This initiative helps us to look at all the capability in Australia and help create collaborations.”

Dr Nave said the benefit of this MRCF model is that the research partners get access to dedicated funding “so we overcome that early stage funding gap”.

“For the investors, they get first right of review of the opportunities, so they realise that there is real risk here, but they hope that they get the next Spinifex or the next Cochlear,” he said. “They are prepared for failure, to make sure they are at the table when they get that success.

“We have had strong returns from drug companies. Fibretech we sold late last year to Shire. It was a $552 million deal. That result represented a 62-times result for our total investment. So it was a really significant deal. When we talk about risk versus reward, this industry really pays off.

“Spinifex we sold a few months ago – I was on the board and I was the Australian rep on the transaction committee – and it was a huge exit, significant – it was A$998 million, the total deal. This is a Queensland-based technology, developed by a really smart researcher, but it started as an idea in a laboratory. It just shows we can do it.”

PARADIGM SHIFT

This approach changes fundamentally the way biotech can be developed in Australia and could help to set the country up as a world leader that consistently develops and commercialises breakthroughs.

“Funding for early stage opportunities really just doesn’t exist in Australia,” Dr Nave said

“It was either being licensed at sub-optimal terms to international companies or it just wasn’t being developed. They (university researchers) were publishing it and then moving on to the next thing. “Remember, this is taxpayer funded research. It should be an obligation for us to make sure we actually generate income and jobs out of the outcomes of that taxpayer funded research.

“As you can imagine, going to sandstone institutes telling them join a venture fund, that’s a bit of an anathema. And so I had great difficulty in the early days. I managed to get seven institutes to join in the early days and then got support from two state governments,” he said.

“Pretty quickly, within six months, word got out that we were actually doing what we said we’d do. We were helping them identify opportunities and we would help them package IP. Then we were hopping on the other side of the fence and investing.”

Dr Nave said the ongoing support of state governments had been crucial to progress.

“State governments have supported us through two election cycles and have all just committed to another seven years – they get funding that actually supports the infrastructure that they have been investing in and developing,” Dr Nave said. “Obviously, hopefully, we help to grow a sustainable industry.

“The MRCF has performed very well, we have been fortunate.

“We have 20 active companies and they cover all of the spectrum that you would expect in biotech – drugs, devices, delivery platforms and diagnostics. We have a number of Queensland companies.”

Dr Nave said the MRCF had success in the development, too, of device companies.

“Osprey we listed in June 2012,” he said. “It was the only company in the world in the biotech space that stayed above its list price. We have just completed a large 650 patient US study and the FDA have approved expanding claims. We have a focus launch at the moment in Texas and sales have doubled every quarter for the last four quarters. We actually have two term sheets on the table now with global pharmaceutical companies.

“GKC (Global Kinetics Corporation) is another story out of Florey (Neuroscience) Institute,” Dr Nave said. “This is a device for treating Parkinson’s disease. It is now being sold in 115 sites across 11 countries and growing rapidly and we have the major companies around the world all funding the roll-out of this product because it makes such a difference to their products that they co-sell with it. 

“Again, a device being manufactured here in Australia, with a market size that is actually bigger than Cochlear’s.”

But Dr Nave said the fund had also had its share of failures – but that went with the territory and it was something “we need to get better at embracing in Australia”.

“Failures have been very interesting for us,” Dr Nave said. “Our investors now feel really comfortable when we kill something, as they see it as investment discipline. Every time something fails we get better at that and we learn for what we do next.

“I often say my job is actually to just try to kill things quickly. The things that I can’t kill go on to be successes.

“As an industry and as a country we need to get better and more comfortable with failure. CEOs of these companies often have a black mark against them for two years before that is washed off and they get the next job.

“That’s crazy. We want people who have seen the movie before and know what it takes to be successful.

“What has surprised us is that because the MRCF is prepared to work with the organisations from the very beginning, sort out IP, write business plans, and then invest, we have actually attracted a lot of other capital that wouldn’t ordinarily come.

“For every dollar we have put in we have attracted another $7 of capital put in – and that’s cash. That’s not in-kind. That’s pure cash going back into the sector. That is a very significant modifier and a very big part, I think, of why state governments keep supporting us.”

The figures verified Dr Nave’s view that MCRF was a true paradigm shift for Australian biotechnology.

“Our first fund we returned over double the money and we have still got seven companies in that portfolio,” he said. “In the second fund we have returned all the fund and that one still has 13 companies left. Our funds have performed well. We have returned over 33 percent RoI over the last three years.

“We went back to our investors and said we took money the way you wanted us to, but we thinks we can push harder and so put to them a concept of splitting what we do into two parts.

“Part A is a $200m fund which is now closed in investing. Stage one of that we have set aside $50m to support 25-35 opportunities. So that is seeding heaps of stuff.

“We’d expect a lot of those to fail, but the important thing is that we get them out and we see if they’ve got a chance of success,” Dr Nave said.

“The companies that are successful go on to stage two, where we have $150 million and we can put up to $17 million per investment. For some of our drug companies this will take them through to phase two proof of concept and we will be able to exit like we did with Spinifex and with Fibretec.

“But the real paradigm shift has been that we now have a stage three for our device companies. We can now put up to $20-$30 million per investor, so up to $120 million per company into assets that truly have the chance to be global businesses.

“This is the paradigm shift because we have not had this capability in Australia – we have always been beholden to sell them at a certain stage overseas, or run the public markets path.

“Our investors are saying please give us real businesses that grow up and our crossover funds will then invest, and our super funds, our public markets funds will still invest and it will help your system and give us greater diversity,” Dr Nave said.

www.mrcf.com.au

ends

MANNY STUL may spend his days playing around with toys – but that has proven to be his great edge in business.

Mr Stul was recently named the 2015 Australian EY Entrepreneur Of The Year (EOTY) and he will travel to Monte Carlo in June next year, where he will compete against national winners from more than 60 countries for the chance to be named the 2016 EY World Entrepreneur Of The Year. 

In 1974, Mr Stul created what became one of the largest, most innovative gift companies in Australia. Skansen Giftware listed on the Australian Securities Exchange in 1993 – and 25 years later, he took control of Moose Enterprise. It has since grown from 10 people to more than 200.

Moose Enterprise designs toy products in Australia and develops, manufactures and distributes from its factories in China and Hong Kong to more than 80 countries. It is the fourth largest toy brand in Australia and is today the eighth largest in the US.

Mr Stul won the prestigious Australian EY EOTY title ahead of 27 other national finalists and was presented at an awards dinner held in Sydney recently.

Chair of the independent judging panel, Glen Richards, the founder and non-executive director of Greencross Limited, said the judges were impressed by Mr Stul’s persistent determination to develop innovative, high quality toys in an extremely competitive global market.

“Moose Enterprise is an Australian company that is taking on the world by combining an incredibly innovative local design team with the cost advantages of low cost manufacturing,” Dr Richards said.

“Manny has demonstrated an ability to understand the demographic of his target market and deliver high quality, innovative toys that are now attracting extraordinary demand from retailers around the world.”

Eight other fantastic Australian entrepreneurs also took home national trophies from the awards ceremony.

They were Kayla Itsines and Tobias Pearce of The Bikini Body Training Company; James Spenceley of Vocus Communications Limited; Cyan Ta’eed and Collis Ta’eed of Envato; James Muecke of Sight for All; Timothy Power of 3P Learning Limited; and Brian White, of Ray White Real Estate.

EY Oceania CEO and area managing partner, Tony Johnson congratulated the winners, saying the winning entrepreneurs’ stories provided inspiration and valuable lessons for those aspiring to emulate them.

“Entrepreneurs have an eye for opportunities and take calculated risks,” Mr Johnson said. “They drive job creation, spark innovation and grow our economy. It’s for these reasons that EY has a long-term commitment to recognising and supporting the best entrepreneurs from Australia and around the world.

“This year we celebrate the 15th anniversary of the EY Entrepreneur Of The Year awards in Australia. And every year we see the incredible talent and enthusiasm that Australian entrepreneurs bring to the table.

“On behalf of EY, I congratulate all of our 2015 national category winners for their innovative ideas, determination and entrepreneurial spirit. I wish Manny Stul all the best when representing Australia at the World EY Entrepreneur Of The Year awards in Monte Carlo next year.

“I’d also like to congratulate Brian White AO, chairman of Ray White Group, for being named as the first Australian winner of the EY Family Business Award of Excellence,” Mr Johnson said.

“Family businesses face unique challenges and the White family has navigated these challenges with great success for three generations. Ray White Group is a testament to the economic and social value that entrepreneurial families contribute.”

Commonwealth Bank group executive or business and private banking, Adam Bennett, said,

“The Commonwealth Bank recognises the great value entrepreneurs bring as innovators that find new solutions to old problems. We look to entrepreneurs as beacons of innovation and leadership. Their achievements and drive inspire the broader business community.

“Congratulations to all of the finalists and especially Manny Stul, this year’s Australian Entrepreneur Of The Year,” he said.

www.ey.com/au/eoy.

2015 EY Entrepreneur Of The Year national winners, by category:

Australian Entrepreneur Of The Year and Industry category – Manny Stul, Moose Enterprise Holdings & Controlled Entities

Emerging category – Kayla Itsines and Tobias Pearce, The Bikini Body Training Company

Listed category – James Spenceley, Vocus Communications Limited

Services category – Cyan Ta’eed and Collis Ta’eed, Envato

Social entrepreneur – Dr James Muecke AM, Sight for All

Technology category – Timothy Power, 3P Learning Limited

EY Family Business Award of Excellence –  Brian White, Ray White Real Estate

 

Ends

 

EXTRA >> MORE than 5500 equipment hire businesses – that together are estimated to contribute about $6.5 billion to the Australian economy – are at risk from banks exploiting the Personal Property Securities Act.

Banks are seizing rented assets from liquidated businesses by utilising provisions in the Personal Property Securities Act. The Act,which allows creditors to seize rented equipment as part of a liquidated business’s assets, has been in place for just three years.

Australian construction hire companies are already losing millions of dollars a year, according to Hire and Rental Industry Association (HRIA) chief executive Phil Newby, Chief Executive of the industry’s peak body, the Hire and Rental Industry Association (HRIA). 

He said the hire industry employs 17,000 Australians, the majority in small and medium sized businesses. Mr Newby said under the Personal Property Securities Act, hire company assets can be seized by another secured creditor, usually a bank, when in the possession of a liquidated business – “ignoring the fact that this equipment is owned by the hire company”.

He said Australia’s hire industry, more than 5500 businesses nationwide, is struggling to cut through the red tape and lack of common sense wrapped around the Act.

Mr Newby said since the Act was introduced three years ago, it was estimated to have cost the industry tens or even hundreds of millions in lost assets and legal fees, saying nothing of the administrative burden.

“There is a misconception that the Personal Property Securities Act protects these businesses. On the contrary, it legislates for ownership to be taken away from these companies and handed on a plate to the banks,” Mr Newby said.

On top of this, he warned the hire company may still be liable for any money owed on the assets that have been taken from them.

“For many of our members this is a devastating scenario. They may even have used their family homes to finance that equipment,” Mr Newby said.

“The way this Act works, if a hire business makes a slight mistake, its customer's bank takes the equipment even if the bank never even knew about it.”

Mr Newby said the industry has been lobbying to have this rectified under the Whittaker Review of the Act, “but in the latest iteration of the legislation, the anomaly remains”.

Tim Nuttall, the owner of Access Hire in the Melbourne suburb of Clayton, said the Act remained a mystery to many in the hire business, who are now required to register their equipment with the Personal Property Securities register.

“This is so foreign to what our industry has always been about – and in essence to the concept of ownership – that it will probably never be understood,” Mr Nuttall said.

It is also something that astounds Gary Kerr, managing director of Kerr’s Hire in Geelong.

“Why should the red tape burden land squarely on our shoulders? “ Mr Kerr said. “We’re small and medium sized businesses, many of us family-owned and operated. We’re having a go, trying to build our businesses. Yet our assets can be taken because of someone else’s financial mismanagement.

“How can anyone believe the banks could be duped into assuming that a ‘lessee’ owns the goods it hired and use them to secure finance for a loan?,” Mr Kerr said.

Despite this, Mr Newby said, the industry was still taking its case to government, requesting common sense prevail.

www.hireandrental.com.au

ends

THE most respected business awards program for Australian entrepreneurs has named a crop of 101 to contest the finals of the 15th annual Australian EY Entrepreneur Of The Year Awards.

EY – formerly Ernst and Young – has announced the 101 entrepreneurs from across the nation (see below) who are in the running to be crowned the 2015 Australian EY Entrepreneur Of The Year and they are an outstanding mix of energy creativity and innovation. 

EY’s Entrepreneur Of The Year Leader for Oceania, Bryan Zekulich, said this year’s nominee field included some of Australia’s best entrepreneurial businesses across a diverse range of fields including property, fitness, technology, food and beverage, kids toys, health and education. 

“In our 15th anniversary year of celebrating the EY Entrepreneur Of The Year awards in Australia, it’s inspiring to see such an abundance of talented and successful home grown entrepreneurs making a significant difference to the local and global economy,” Mr Zekulich said.

“At EY, we believe the new wave of Australian businesses is critical to the next generation of job seekers and to maintaining our nation’s high standard of living. The Federal Treasurer has also recognised the significant value entrepreneurs bring to the economy and, through the recent budget initiatives, is helping promote further innovation and enabling more people to chase their business dreams.

“Recognising and promoting success stories is another way we can encourage future entrepreneurs and EY is proud to have now celebrated 15 years of entrepreneurial excellence in Australia.

“Each of the nominees in this year’s program has the courage and conviction to make their business dreams a reality and, in the process, they are helping build a better working world by creating new jobs, driving innovation and productivity, boosting the economy and inspiring others.

“Being selected to take part in the Entrepreneur Of The Year program is a significant achievement and we congratulate all of this year’s nominees on reaching this milestone. We look forward to following their progress through the regional and national awards, and to crowning one of them as our 15th Australian EY Entrepreneur Of The Year later this year.”

Commonwealth Bank business and private banking group executive, Adam Bennett said entrepreneurs “are a critical part of the Australian economy and we are proud to be the principal sponsor of a program that recognises the exceptional standard of entrepreneurial achievement in Australia”.

“Australia continues to be fertile ground for outstanding and diverse entrepreneurial talent, and this year’s nominees are a world-class representation of business leadership,” Mr Bennett said.

“At the Commonwealth Bank, innovation is part of our DNA and we are honoured to be associated with some of Australia’s top business innovators, who continue to inspire and motivate others in their pursuit of high calibre enterprise.

“I would like to congratulate all the nominees and wish them the best in their pursuit of this accolade.”

The nominees will first vie for regional honours at award ceremonies across the country during July and August, with the regional category winners going on to compete at the national awards ceremony in Sydney in October.

The overall Australian winner will then continue on in the global program, travelling to Monte Carlo in June 2016 to compete against other national winners from more than 60 countries for the chance to be crowned the EY World Entrepreneur Of The Year.

Nominees are assessed by a panel of independent judges, including previous Entrepreneur Of The Year award winners and other successful Australian business leaders according to six core criteria: entrepreneurial spirit, innovation, personal integrity and influence, financial performance, strategic direction, and national and global impact. 

The Australian Entrepreneur Of The Year – linked with the global program – began in 2001 and now has alumni of more than 1,400 entrepreneurs who have participated. Since the program’s inception more than 15,000 people have attended Entrepreneur Of The Year events and award ceremonies in Australia. EY Entrepreneur Of The Year celebrates those who are building and leading successful, growing and dynamic businesses, recognising them through regional, national and global awards programs in more than 145 cities in more than 60 countries.

www.ey.com/au 

Regional nominees in the 2015 Australian EY Entrepreneur Of The Year awards are:

Central Region (SA & NT) nominees:

Kylie Bishop – LBW Environmental Projects

Tony Ceravolo and Joe Ceravolo – Ceravolo Orchards Pty Ltd

Chris Christopher – Sunfresh Salads Pty Ltd

John Eastwood – U-Store-It Pty Ltd

Phil Harris - Harris Real Estate

Kayla Itsines and Tobias Pearce – The Bikini Body Training Company

Kelly Keates – Zonge Engineering and Research Organization (Australia) Pty Ltd

Kivi Kuet Vi Lay – Lay Group

Andrew Nunn – JBS&G

Toby Strong – PODiSTA

Sheree Sullivan and Saul Sullivan – Udder Delights Group & Cheese Cellar

Jason Valentine – CPR Pharma Services Pty Ltd

Paul Vinton – Vintek

Jim Whalley – Nova Systems

Central Region award recipients:

Social entrepreneur – Dr James Muecke – Sight For All

Champion of Entrepreneurship – Peter Hurley – Hurley Hotel Group

The Central Region awards ceremony will be held in Adelaide on Thursday, July 16, 2015.

 

Eastern Region (NSW & ACT) nominees:

Jeff Board – JAX Quickfit Franchising Systems Pty Ltd

Greg Boorer – Canberra Data Centres

Paul Chan – Pureprofile

Evan Clark – ClickView

Marc De Stoop – Climatech Group

Aurora Fonte – Assetlink

Michael Frizell – Pet Circle

Rodney Grunseit – Sunshades Eyewear Pty Ltd

Jason A Gunn – Oliver’s Real Food

Stephane Ibos – Maestrano Pty Ltd

Connie Mckeage – OneVue

Hamish Petrie – Ingogo

Timothy Power – 3P Learning Limited

Nadia Taylor and Alf Taylor – TNA Australia Pty Ltd

Andy Taylor – Yatango

Dean Willemsen – Prime Build

Eastern Region award recipients:

Listed award – James Spenceley – Vocus Communications Limited

Social entrepreneur – Robert de Castella AO MBE – Indigenous Marathon Project and SmartStart for Kids

The Eastern Region awards ceremony will be held in Sydney on Thursday, August 13, 2015.

 

Northern Region (QLD) nominees:

Carl Amor – Aqualuma LED Lighting

Michael Bell and Nic Blair – Search Factory

Stephen Donnelly – Blue Ribbon Group

Greg Dower and Darren Stewart – my FootDr podiatry centres

Kate Farrar – QEnergy

Mark Fletcher and Paul Jones – Cohort Solutions

James Freestun – Solutions Group of Companies

Marlies Hobbs – Paleo Café

Mark James – The GJI Group

Dwayne Martens – Amazonia

Fred Mohammed – Crane Trucks R Us Pty Ltd

Dr Mark Perissinotto – VetShopAustralia

Dean Robertson – Mexia

Robert Rowe – Tú Projects Pty Ltd

Katie Schloman – Miktysh

Sarah Timmerman – Beginning Boutique

Michael Trusler – PlantMiner

Paul Woosley – Australian Prime Fibre

Peter Wyatt – Record Holdings

Northern Region award recipients:

Listed award – Mark Sowerby – Blue Sky Alternative Investments Limited

Social entrepreneur – Juliette Wright – GIVIT Listed Ltd

Champion of Entrepreneurship – John Van Lieshout – Unison Projects

The Northern Region awards ceremony will be held in Brisbane on Thursday, July 30, 2015.

 

Southern Region (VIC & TAS) nominees:

Nicki Bowers – Kloud Solutions

Suren Chandrajit – LEDified

Daniel Flynn – Thankyou

Josiah Humphrey and Mark McDonald – Appster

Tolga Kumova – Syrah Resources Limited

Craig McDonald – MailGuard Pty Ltd

Dr Kia Pajouhesh – Smile Solutions

Michael Schreiber – Strike Entertainment

Manny Stul – Moose Enterprise Holdings & Controlled Entities

Cyan Ta’eed and Collis Ta’eed – Envato

Emma Welsh and Tom Griffith – Emma & Tom’s

Southern Region award recipients:

Listed award – Andrew Sudholz – Japara Aged Care and Retirement

Social entrepreneur – Ian Carson – SecondBite

Champion of Entrepreneurship – Richard Smith – PFD Food Services 

The Southern Region awards ceremony will be held in Melbourne on Thursday, August 6, 2015.

 

Western Region (WA) nominees:

Matthew Allen – Subcon Technologies Pty Ltd

Russell Baskerville – Empired Limited

Paul Bitdorf – Nicheliving

Maurice Brand – Liquefied Natural Gas Limited

Damian Collins – Momentum Wealth

Suzanne Daubney – Bannister Downs Dairy

Ayman Haydar – Haydar Pty Ltd

Scott Houston – Executive Risk Solutions

Torsten Ketelsen – GMA Garnet Group

Lauren Knee – Silk

Veronica Macpherson – MACRO Realty Developments

Rick Musarra – CraneCorp Australia Pty Ltd

Petra Nelson – Bright People Technologies Pty Ltd

Savvas Papadopoulos – Aerison Pty Ltd

Prof Tim St Pierre – Resonance Health Limited

Dr Marcus Tan – HealthEngine

Craig Thompson – Sea Corporation Pty Ltd

Benjamin Trinh – Life Ready Health Group

Western Region award recipients:

Listed award – Peter Botten – Oil Search

Social entrepreneur – Lockie Cooke – ICEA Foundation

Champion of Entrepreneurship – Dale Alcock – ABN Group

The Western Region awards ceremony will be held in Perth on Thursday, July 23, 2015.

Ends

 

 

 

THE Senate Standing Committee on Economics has heard damning criticisms of the Australian Securities and Investments Commission (ASIC) and Taxpayers Australia is highlighting ASIC’s poor handling of how multinational corporations represent themselves in Australia.

Senator Christine Milne’s probing of ASIC’s ‘check-and-rein’ protocols has produced worrying insights, according to Taxpayers Australia, which also submitted to the enquiry “at worst, the government regulator has an ineffectual standing among multinational corporations, who are playing fast and loose with basic compliance and self-determination processes”. 

Taxpayers Australia’s head of tax, Mark Chapman said ASIC’s primary misstep — highlighted by Sen. Milne in session last week — was best summarised as “an inability to regulate Australian subsidiaries operating as part of larger, overseas parent companies”. 

ASIC’s current Class Orders only require large organisations and large Australian-based groups to submit financial statements. 

“The rub is this:  businesses self-determine their size, and thus their eligibility to report to ASIC,” Mr Chapman said. “Self-determination requires an honour-based compliance standard. 

“Therefore less-than-honourable businesses can dodge regulation by determining themselves ‘small’ with little apparent fear of ASIC validation.”

Taxpayers Australia claims Facebook Australia “looks to have done this, being an Australian subsidiary of a larger overseas parent company”.

“Given the size of the Facebook global empire, questions need to be asked about Facebook Australia’s ‘small company’ self-determination,” Mr Chapman said. “Its practices are sobering proof an overhaul is needed.”

In a submission to the Senate Standing Committee on Economics, Taxpayers Australia has sought to tackle the legislative grey area Facebook Australia – and Facebook US, being the parent – may be operating in.

“The fact remains, ASIC has not defined large multinational group disclosure arrangements,” Mr Chapman said. “Taxpayers Australia notes that under current law, ASIC’s existing Class Orders do not require multinational corporations to submit financial statements in respect of their Australian subsidiaries.

“Therein lies the worrying likelihood of ASIC missing out on critical financial information.”

Mr Chapman said Taxpayers Australia advocated it essential that not only ASIC follow the law in relation to self-determination, but that the law was appropriate in the first place.

“And clearly it isn’t,” Mr Chapman said. “We’re not calling for over-regulation but clearly when the parent company of one of the world’s largest corporations is able to legitimately describe itself as small – with all the implications that carries for the amount of scrutiny it will receive by ASIC and later the Tax Office – there is something very wrong with the rules.”
Taxpayers Australia said its understanding was that the Australian Taxation Office (ATO) can request financial statements from relevant subsidiaries of foreign multinationals, but ASIC’s laws do not support any such procedures. 

“The two bodies should work in tandem,” Mr Chapman said. “As it is right now, any financial statements provided independently to the Tax Office would not be legally subject to audits by an independent third party, nor would they be need to be prepared in accordance with Chapter 2M of the Corporations Act 2001 (Cth).”
Taxpayers Australia is calling on the Senate Committee to clarify the extent to which ASIC consults with the ATO and other powers when formulating Class Orders. 

“The partnership of ASIC and the ATO, with respect to multinational compliance, must be seen to deliver clear legislative strength,” Taxpayers Australia said in a statement. “If it does not, the government must act to strengthen the law covering the  verification of self-determination processes.

“Proof the Tax Office is receiving quality information from foreign multinationals to aid ongoing compliance must be given, and ASIC must address glaring holes in Class Orders stipulating company self-determination criteria.”

www.taxpayer.com.au

 

ends

 

A CONCENTRATION on customer service may be the vital edge Australian small and medium enterprises can develop to shore up their local markets and progress into new ones, according to research into customer service globally by American Express.

The big message for Australian small business, from the American Express 2014 Global Customer Service Barometer, is that they can not only compete with bigger businesses but also win customers away from them through a concentration on high calibre customer service. 

According to American Express vice president for customer service, Andrew Carlton, the research showed not only the power of recommendation that results from a good experience – on average a customer will tell nine people about their positive service experience – it also warned about the multiplier effect of poor customer service.

Research showed customers in Australia would vent their frustrations at bad service to an average of 18 people.

Furthermore, Mr Carlton said the research found 72 percent of Australians claim to have spent more with a company where they’ve had a good customer experience. On average, Australians are willing to spend 12 percent more.

“Our key message is that the brand is important but service that comes with that brand is more important,” Mr Carlton said.

“We see this with many of our customers; they vote with their wallets after they receive great service. Globally, American Express card members who are highly satisfied with their service interactions spend 16 percent more on their cards. It’s why we are so committed to delivering our award-winning customer service.”

The American Express 2014 Global Customer Service Barometer surveyed 10 major markets throughout the world including the United States, Canada, Mexico, Italy, The United Kingdom, India, Japan, Singapore and Hong Kong.

Of the 10 nations surveyed Australians were found most likely to use companies based on the recommendations of family and friends with 45 percent citing this as a key influence on choosing to do business with a company. Australia was ahead of the UK and Canada (both 44 percent) and the US (42%), while India (22%) and Japan (20%) were at the bottom of that table but both were prominent in seeing a company’s reputation as the most likely influence.

“Australians place a higher importance on the personal touch than other nations, with about 40 percent of respondents preferring to speak to a ‘real’ person over the phone for difficult inquiries, and 31 percent a face to face conversation,” Mr Carlton said.

Social media is a sideline in this game, according to Mr Carlton.

“Face-to-face, word of mouth is the preferred way to communicate views on service,” he said. “Social media is more commonly used when people are getting frustrated.”

He said even recommendations through social media were not nearly as powerful as a personal verbal recommendation.

“For a single enquiry, consumers prefer to go to the company website or get in touch by e-mail. For more complex things, they prefer to talk to somebody. The preference is the phone for most service enquiries.

“The majority are meeting expectations but can improve.

“But there is a difference between information and service,” Mr Carlton said. “More information is available today. Most customers will go online for that.

“Click to chat (for service through a website) is becoming more important. In fact about 10 percent of people have click to chat as a preference now.”

The rise of unified communications and a preference for Skype-style links were also changing things. Mr Carlton said the increase of video chat may raise that kind of service.

“Phone at the moment is a 41 percent preference,” he said. “Video may soon prove to be as prevalent as instant messaging. But the key is wanting to talk to a real person.

“The main component is that customers want to talk to someone knowledgeable.”

Mr Carlton said the research outcomes “really are a pat on the back for Australian businesses, but they also serve as a clear reminder to businesses at the busiest time of year that people have no hesitation in telling others about their service experiences, good or bad” .

“What does good customer service really mean? About 24 percent count that as individual recognition,” Mr Carlton said American Express’s research showed

“And 23 percent is about product and service. Another 23 percent is the value promise at the right price.

“Customers who believe they get good customer service are loyal and re-use – and recommend – and that means new business.”

Mr Carlton said recommendation outcomes tended to be about who was being listened to, who was a trusted source.

“The channel is not nearly as important.”

www.americanexpress.com.au

 

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ONE of the world’s leading researchers of small business, Harvard Business School professor John Lerner, will headline the official launch of the 2014 Queensland Small Business Week by State Premier Campbell Newman on Tuesday at Brisbane City Hall.

State Minister for Tourism, Major Events, Small Business and the Commonwealth Games, Jann Stuckey said Prof. Lerner would address the theme, When small business thinks BIG at the official business luncheon launch event at which about 200 business, government, industry and community leaders can join a panel discussion led by the international business expert. 

Ms Stuckey said the event was one of five Ministerial events and more than 100 activities planned across Queensland during the Week, which runs from September 1-6.

“We have invited Professor Josh Lerner from Harvard’s Business School to discuss how Queensland business is performing on the world stage,” Ms Stuckey said.

“I am excited about the opportunity to join some of our 400,000-strong hard-working small businesses in celebrating 2014 Queensland Small Business Week.

“Small businesses employ about one million Queenslanders, that’s more than 50 percent of all private sector workers.”

Ms Stuckey said the When small business thinks BIG event would focus on what business can achieve when it thinks globally.

She said 2014 Queensland Small Business Week celebrates the role small business plays in the Queensland economy.

Prof. Lerner is the Jacob H. Schiff professor of investment banking at Harvard Business School, and head of the Entrepreneurial Management unit.

Prof. Lerner sits on the World Economic Forum and presents annually on small business and entrepreneurship.

Business leaders can register for the event on the Queensland Government’s business and industry portal.

www.business.qld.gov.au/smallbusinessweek

 

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