The message wasn’t lost on Holgate.
“She knew instantly she was gone,” says one confidante who spoke to Holgate within half-an-hour of the Prime Minister’s remarks.
“She said ‘that’s it, I’m done. I can’t come back from this’.”
It took her another 11 days to quit, as her camp kicked into reputation-salvage mode and rallied high-profile business leaders and political figures in her defence.
As she bowed out on Monday, she attributed her demise to a failure to appreciate the “optics” of the luxury gifts, and made it clear she was not seeking any financial payout.
“I deeply regret that a decision made two years ago, which was supported by the chair, to recognise the outstanding work of four employees has caused so much debate and distraction and I appreciate the optics of the gifts involved do not pass the ‘pub test’ for many,” she said in her resignation statement.
Bob Black, the group chief operating officer who left Australia Post earlier this year after a five-year stint, watched the Cartier saga unfold with bafflement from the UK, where he lives with his family.
“Somebody or some people have got it in for her,” Black says. “As a CEO of a multi-billion dollar company, you buy four watches and you’re stood down for it? It’s just ridiculous.”
Poached by Australia Post after 30 years at courier delivery giant TNT, including five years as managing director of its Australia operations, Black says Holgate was “not everybody’s cup of tea” but had a tireless work ethic.
“She had massive supporters but she had people trying to derail her. But what I would say about her is you haven’t met a CEO who works harder,” Black says.
“She’d be up early and still in the office until 9 at night before going back to the hotel to work until midnight.
“I’ve been in the industry 35 years and worked for a lot of people. In terms of her commitment, drive and energy, she was honestly right at the very top.”
Holgate’s exit was set in train at a Senate estimates hearing on the morning of October 22, where she revealed her office had purchased the watches for the employees as a reward for their work in signing three of the four big banks to the Bank@Post deal. The watches had cost a total of $19,950, while the deal had netted $22 million a piece from each bank to provide banking services at post offices.
One senior Australia Post manager, who was not authorised to speak publicly, says the gifts, while not widely broadcast, were not a secret inside the company.
“I do think they were too much, dollar wise, but from what I knew they were a one-off. The deal was really significant,” the employee says.
“While they may have raised a few eyebrows, the reaction now seems over the top.”
“As a CEO of a multi-billion dollar company, you buy four watches and you’re stood down for it? It’s just ridiculous.”
Bob Black, a former executive general manager of Australia Post
Inside government circles, Holgate’s crucial misstep was her justification – brutally dubbed an “11-word suicide note” – that no public funds had been expended on the gifts.
“I have not used taxpayers’ money. We are a commercial organisation,” Holgate told the Senate estimates hearing.
One government MP, who spoke on the condition of anonymity, says the admission was an “indictment” that after three years at the helm, Holgate still did not appreciate the standard of accountability expected of government-owned businesses like Australia Post.
“Morrison’s quite a middle-class PM. He’s not like Malcolm. He would be thinking about what his constituents think of this. Most Australians are working in jobs where there’s no such thing as a bonus,” the MP says.
The MP adds: “It was quite classy of her to say she wasn’t going to take any payout, when she had a legitimate claim to one.”
If she had failed at the optics at the first hurdle, many believe she nailed them on the way out the door.
Former Prime Minister Malcolm Turnbull, whose government appointed Holgate to lead the postal service in 2017, was among a slew of public figures who lined up to offer glowing character references.
“I certainly do not think the Cartier watch thing should be a hanging offence,” he told ABC TV.
Her former boss vitamins mogul Marcus Blackmore branded her treatment unfair, Industry Super chief Ian Silk said she was a victim of a “pile on”, and former Foreign Minister Julie Bishop praised her leadership skills.
Then there was the blistering public statement from her legal counsel Bryan Belling, an experienced employment lawyer, which lobbed at the feet of the board the prospect of a costly break-up.
Belling accused the board of having failed to follow basic legal process in standing her aside and claimed, in any event, there were no grounds for doing so, noting that “optics” was “not a legally-valid defence”. The board hit back saying Holgate had agreed in a phone call to stand aside.
Against the backdrop of this brewing stoush, Holgate pulled the pin four days later, making it clear she wanted none of the $700,000 she was contractually entitled to had her contract been terminated.
“I am not seeking any financial compensation,” Holgate said in her departure statement.
It was a rare move in the highfalutin world of C-Suite executives who are usually dispensed with a golden handshake. The contrast with her predecessor Ahmed Fahour, who exited three years earlier with a $10.8 million payout, was stark.
“It was about letting the world know she hadn’t done anything wrong, going out with her head held high, and saying this was not about the money,” one of her supporters says.
However, Holgate’s critics are quick to point out that her departure does not absolve genuine questions about the governance culture inside Australia Post.
The Cartier watches scandal added to an existing perception of largesse inside the senior ranks of Australia Post, already fuelled by a series of damaging revelations about Holgate’s corporate expenses.
It emerged that she had spent $300,000 on corporate credit cards and chauffeur-driven cars in the 2019/20 financial year, and had agreed to pay a reputation management firm $119,000 for 38 days’ work for the organisation between June and July.
The news headlines came as Australia Post was grappling with intense demand spurred by COVID-19 lockdowns, triggering complaints from customers about parcel delays and anger from the unions over the move to “every-second-day” letter deliveries in metro areas.
The watches saga also coincided with a renewed wave of scrutiny of executive pay and bonuses within government agencies and businesses.
One of the employees to receive a Cartier watch in 2018 was Gary Starr, executive general manager of government and business. That same financial year he took home $413,000 in bonuses, taking his total salary to $1.2 million.
As thousands of Australians were laid off due to coronavirus this year, Australia Post paid out $92.4 million in bonuses, including to 502 staff on salaries between $252,000 and $845,000. The smallest average bonus was $43,000. Holgate and her executives agreed in March to forgo their bonuses, on top of a 20 per cent pay cut – a commitment they had to be pressured by government to stick to as internal leaks suggested Holgate had taken a contrary pay proposal to the board.
A number of former senior employees, who spoke on the condition of anonymity, say the federal investigation should lift the lid on a corporate culture that has long been accustomed to extravagance and wasn’t reined in on Holgate’s watch.
“There’s a culture of excess and largesse which, to be fair to Christine, started years ago,” one says.
“There was a complete lack of oversight on credit card spending. If you did an audit of B cards, which are the company credit cards, the waste would be enormous. If you went out for coffee with someone from Post, you’d put it on the B card. Let’s go have lunch – you’d put it on the B card.”
Another former employee also agrees there was a “very lax attitude” towards corporate spending, and recalls lower-ranked employees being asked [by senior employees] to put lunches and dinners on their corporate credit cards so they could avoid scrutiny.
“I found the largesse on some of the B cards pretty extreme,” the ex-employee says.
“The attitude to government in there was also quite amazing. They were very indignant to government scrutiny and that attitude was not restricted to the CEO. That attitude pervaded the whole organisation.”
The investigation, led by the communications and finance departments, is due to hand its findings to government by the end of the month.
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Lisa Visentin is a federal political reporter at The Sydney Morning Herald and The Age, covering education and communications.