ENSW MEMBER UPDATE – 28 JULY 20

Since Equestrian Australia (EA) was placed under voluntary administration, Equestrian NSW (ENSW) has been working hard behind the scenes with four State Branches (EVIC, ESA, EWA and ETAS) to map an alternative way forward.  

We understand that members want change.

However, we believe this change should be done with much greater consultation and engagement across the equestrian community than what has been done by EA’s administrator KordaMentha. Our focus is to ensure there is considered debate across the country and across the disciplines so members can make informed decisions about the future of the sport, and the outcome is sustainable and delivers the change members want to see.

Using the guise of financial insolvency to force constitutional change in our view, is inappropriate. This is why we have been working on an alternative. But in doing so, we recognise that we have not been communicating quickly and thoroughly enough to provide you with our views so you can be informed. Unfortunately this has resulted in misinformation circulating on social media. We want to take the opportunity to correct this misinformation.

The view of the ENSW Board is that:

• EA was, is and can continue to be solvent (ie it can pay all its bills on time even with the withdrawal of Sports Australia funding).
• The EA voluntary administration process has nothing to do with solvency of the company.

• The EA Directors did not talk with State Branches to discuss financial or structural issues before sending the company into voluntary administration. This process is likely to cost members more than $300k, when alternative options could have been explored. Voluntary administration should have been a last resort. The State Branches must take ownership of the problems with the EA Board. While we have recognised the need for change, as a collective we have failed to work together to find a solution.  
• KordaMentha has misrepresented ENSW, ESA, ETas, EVic and EWA by claiming that only their Deed of Company Arrangement (DOCA) will deliver the changes wanted by the FEI and Australian Olympic Committee (AOC).
• Neither the FEI (see attached letter here) nor the AOC have mandated one member one vote, nor any particular structure. This has been inaccurately reported to you.
• The AOC has advised that if EA goes into liquidation (and there is no National Federation for Equestrian at the time of Olympic nomination/selection), the AOC will simply nominate/select the equestrian athletes to represent Australia at the Tokyo Olympics (see attached AOC letter here). The threat that equestrian athletes/horses won’t be able to compete at the Tokyo Olympics is false.
• KordaMentha intend to choose both the members of a Nominations Committee and in turn, the Interim EA Board. KordaMentha are administrators, not experts in governance or sports administration. The EA Board must be selected by the sports of equestrian.
• While the principle of the one member one vote system may be democratic, it is not necessarily  representative, particularly when voting is voluntary. We note that no other FEI affiliated National Federation nor any Australian National Sporting Organisation has a one member one vote model and Sport Australia has never before supported such a governance model. As a Board, we are concerned that KordaMentha is using EA as a test case as there is no precedence for this model at a National Sporting level in Australia.  
• KordaMentha’s proposed EA Constitution has one member one vote, but allows just  38 of 18,000 individual members vote to change the EA Constitution (ie 75% of a quorum of 50, or 0.2% of the entire membership). Conversely, just 13 members may prevent constitutional reform.  It highlights the downside of this model, which is that a minority can effect change for the majority of members in such a model. This model fails to demonstrate how it will result in greater Board stability when it is so easy for a minority to affect change. In fact, we  believe this model could result in an even higher chance of Board instability.
• By using a voluntary administration process to drive constitutional change, we are now in a situation where KordaMentha can liquidate EA unless the State Branches do what it says.
• The EA Board, on their dedicated website FutureEA and facebook videos, say that the State Branches can’t be trusted to deliver governance reform.  In 2018, the Branches worked together to define the services that EA, the Branches, Committees and Clubs should provide, but couldn’t complete the analysis because EA wouldn’t release their costing information. The hurdle in progress was the EA board, not the States.
• The Equestrian NSW Board is absolutely committed to governance reform, but in an orderly and informed way, allowing enough time for members to understand the options and decide which model is best. We want every person to have a voice in the process.

Our commitment to you

As the Board of ENSW, we promise you - our members:

1. We want KordaMentha to step aside immediately, to stop the un-necessary bleed of YOUR cash for a job that is not necessary. We want experts in governance and in sports to drive the change, not solvency experts.
2. Like all other sports coming through  COVID-19, we commit to finding improved revenue and reduced costs, to get our sport back on its feet as quickly as possible for a sustained future. This includes a different and improved governance model.
3. For the sport to choose a Nominations Committee and Interim Independent EA Board.
4. For the State Branches to commit to working collectively and collaboratively towards a governance reform process, under a formal agreement with the Interim EA Board, which clearly defines obligations to do the due diligence, present options and recommendations to members and give them a genuine voice in the future. That’s how Cycling and Sailing did it, and it worked.
5. We will work with the sport disciplines and clubs who are the future.
6. Improved transparency and reporting regularly as the process is navigated by independent and expert people in your best interests.

We want and need your feedback, so please click on the following link;

https://www.surveymonkey.com/r/GKKNDHN

• to do a quick five minute survey. You will need your Equestrian NSW membership number (eg 2123456).
• If you have any questions, please email [email protected] and we will post questions and answers on our web site, as long as they are respectful and not personal.

PETER DINGWALL – President Equestrian NSW