New Telstra CEO: No new strategy
David Thodey is named the new CEO of Telstra, promising the company's strategy remains unchanged.
Telstra has replaced its two leaders, with incumbent chair Don McGauchie making a surprise, immediate exit.
The telecommunications giant confirmed the appointment of senior executive David Thodey to the post of chief executive officer, and current board member Catherine Livingstone as chair.
Mr Thodey - a former chief executive of IBM Australia and New Zealand - is described as urbane and articulate and is thought to be popular with the Federal Government.
Telstra's chair Don McGauchie quits.
Mr Thodey said there would be "constructive engagement" with the Government.
Ms Livingstone replaces former farmers boss Mr McGauchie, effective immediately.
The news drove the share price up slightly when the market opened. Stock was 4 cents higher at $3.28 in morning trade.
Mr Thodey's appointment takes effect when the controversial outgoing CEO Sol Trujillo leaves Telstra to return to the United States. BusinessDay this morning revealed the pending appointment of Mr Thodey.
Mr Thodey said he was delighted to be appointed chief executive of Telstra and looked forward to building on the strong foundation left by Mr Trujillo's four years at the helm.
He described outgoing CEO Sol Trujillo as an "outstanding leader", but pointedly refused to endorse his predecessor's national broadband network strategy, despite repeated promptings.
"Our strategy remains unchanged: to continue to provide customers with world-class products and services,'' he said.
The key to Telstra continuing to win and to serve customers will be finishing our transformation that started nearly four years ago.
"Completing the transformation will enable us to deliver a superior customer experience and the financial outcomes that our shareholders expect.''
Mr Thodey, 54, has been a senior executive at Telstra for eight years.
He joined Telstra from IBM where he was chief executive of IBM's Australian and New Zealand operations.
In his current position, he has been responsible for Telstra's corporate, government and large business customers in Australia, TelstraClear in New Zealand and Telstra's international sales division.
With the chief executive selection process complete, Mr McGauchie resigned as Telstra Chairman and said he would leave the board immediately.
"Telstra's strength and ongoing performance are the paramount priority,'' Mr McGauchie said in a statement on Friday.
"It is my view that speculation on my tenure was a distraction to the business.
"Nothing should be allowed to get in the way of David and the management team getting on with the important job ahead of them.''
Last month, Telstra was on the receiving end of strong criticism from its biggest shareholder, the Future Fund, over the erosion of its multibillion-dollar stake in the telecommunications giant.
Future Fund chair David Murray said the value of its 16% holding had fallen by about $2 billion because of speculation over the national broadband network, and which companies would build it.
At the time, Mr Murray would neither confirm nor deny that the fund would press for an extraordinary general meeting aimed at unseating Telstra's board.
The Future Fund is a government body established to oversee cash in public sector superannuation savings. As at the end of March, there was almost $60 billion in the fund, about 10% of which was in Telstra stock.
The Telstra board also has appointed Telstra's chief financial officer John Stanhope, a contender for the CEO's position, as an executive director of the Telstra board.
The controversy surrounding building materials supplier James Hardie Industries' handling of its responsibilities to the asbestos diseases fund claimed another casualty when Telstra said another director, Peter Willcox, also was leaving the board, "due to his concern that the James Hardie judgment may cause embarrassment to the company''.
The Telstra board had asked Mr Willcox to stay on until the telco's annual general meeting in November, which he had agreed to do.
Mr McGauchie also is a director of James Hardie.
Telstra's new chair, Ms Livingstone, has been a director of the company since 2000.
More to come
BusinessDay
