Cleanaway Waste Management chief executive Vik Bansal has been put on final notice over his “unacceptable conduct” and the company’s chief financial officer Brendan Gill has announced his resignation.
The news comes just hours after an investigation revealed Mr Bansal was probed over allegations of leading a “culture of bullying and harassment”.
The Mark Chellew-chaired board of Cleanaway on Monday confirmed the report in The Australian Financial Review, noting that Mr Bansal had “some issues with overly-assertive behaviour” in the workplace and that the boss had acknowledged he needed to address them.
“The board will not tolerate any further instances of unacceptable conduct,” Mr Chellew said.
In a statement, Mr Bansal said he accepted the feedback and was committed to creating a “progressive culture” at Cleanaway.
In a separate statement, Mr Bansal said he was “disappointed” that Mr Gill was retiring and that he would be replaced by Paul Binfield, chief financial officer at NuFarm.
Cleanaway shares have rallied more than 300 per cent since Mr Bansal joined the group in 2015, transforming the company into a $5 billion ASX100 company.
On Monday, the stock slumped 13 per cent at the open of trade, before recovering slightly to change hands 7 per cent lower by 11am.
The on-market share sales came just days after fine print in Cleanaway’s full-year financial accounts showed Mr Bansal “offered to forgo” his short-term incentive bonus “due to COVID-19 related challenges faced by the group” and that the board had “agreed to reduce” his short-term bonus by 25 per cent.
No other Cleanaway executive manager volunteered to reduce their bonus that year and no reason was provided to the market for Mr Bansal’s share sales.
Australia’s biggest superannuation fund, the $180 billion AustralianSuper, declined to comment on Cleanaway. The fund holds a 4.85 per cent stake in the group, worth $250 million. Dimensional Fund Advisors, which holds an $180 million stake in Cleanaway, also declined to comment.
The Financial Review revealed on Monday that Mr Bansal was investigated in June over accusations he led a “culture of bullying and harassment”, created an environment where senior managers couldn’t escalate bad news for fear of reprisal, and expected employees to work from the Melbourne headquarters against Victoria’s coronavirus guidelines.
Former and current Cleanaway employees who have worked with Mr Bansal argue his leadership style is the chief reason for the company’s high rate of turnover in senior management and lower-level employees, which included a recent instance where six out of eight general managers resigned within a six month period.
In a statement, the Cleanaway board said it took allegations of misconduct in the workplace “very seriously” and that it had been working with Mr Bansal to ensure his conduct met expectations.
Mr Bansal is now receiving “mentoring” and is subjected to “enhanced reporting and monitoring”.
“Mr Bansal had some issues with overly-assertive behaviour in the workplace and has acknowledged that he needed to address them,” Mr Chellew said.
“The board is disappointed in the circumstances but has taken appropriate action,” he said.
“We have noted the committed and sincere manner in which Mr Bansal has responded.”
Cleanaway said Mr Gill, who joined the company as chief financial officer in September 2014, would remain in his role until February and that he was leaving the group’s balance in a “very healthy state”.
“While I am disappointed that Brendan has made the decision to retire, I am also excited Paul will be joining our team,” Mr Bansal said.
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