Peter Costello Hugh Marks Nine
Nine Entertainment chairman Peter Costello and CEO Hugh Marks. (Image: AAP/Dan Himbrechts)

As the man himself admitted to The Australian Financial Review yesterday, there have been lots of rumours about Nine chief executive Hugh Marks having relationships with multiple female staff.

And as with so many resignations, Marks appears to have come a cropper courtesy of the cover-up rather than the original sin.

Once the relationship with direct report Alexi Baker had commenced “a couple of months ago”, Marks should have informed the full Nine board. Instead, he didn’t tell them until last week, even though Baker resigned from the business with approving quotes from Marks provided to the AFR back on October 1.

I had no idea about any of this when lodging this written question at the Nine annual general meeting (AGM) last Thursday:

The Sunday Telegraph published a story last May which seemed to suggest that our CEO was now in a relationship with an employee of Nine. Is this correct?

If so, how were the obvious sensitivities of this situation managed internally and is the chairman comfortable with the situation?

As you can see 55 minutes into this webcast, chairman Peter Costello was not at all comfortable responding to this question about Marks’ still-denied relationship with his then executive assistant, Jane Routledge, and said the following:

Is this correct? Well, it is correct that it was published, yes. I obviously saw the article.

As a result of what was published and my own inquiries I don’t believe that there is anything that has breached the company’s policies or its code and I don’t believe it warrants any further engagement.

This provided some fodder for The Australian’s Margin Call column on Friday. It also prompted an insider to lob an anonymous email into my inbox claiming Marks was now in a different relationship with the former head of strategy.

I hadn’t seen Andrew Hornery’s piece in The Sydney Morning Herald on Saturday quoting Marks confirming the Alexi Baker relationship before sending this email to three female Nine executives — the head of media, the head of investor relations and the general counsel — at 8.30am on Saturday morning.

Hi Nola, Victoria and Rachel,

I’m not particularly interested in causing trouble for Hugh Marks and Nine but after asking that question about The Sunday Tele piece at the AGM, the following email tip came through to me:

Hi Stephen,

Bravo on your question regarding Hugh and Jane’s affair at yesterday’s Nine AGM. Costello’s response was disappointing but thoroughly unsurprising.

For your background only …

You may be surprised to learn Hugh has moved on from Jane to another one of his direct reports, the head of strategy. [SIGNIFICANT DETAIL REDACTED]

… They plan to come out as a couple once she’s an ex-employee. They don’t realise half the company knows.

You’d think the chairman of the Future Fund would value his reputation more highly. But clearly he doesn’t understand 2020 standards or the basics of governance.

Toxic.

Name Withheld

Given that you all work for Hugh, could I ask that you forward this email to both Peter and Hugh so that they can work up an on-the-record response, presumably after consulting some of the other independent directors.

I only intend to report the truth, whatever that may be, but do note that QBE has removed its last two CEOs over relationships with employees.

There’s no rush with this but would appreciate a response by the middle of next week if that is okay as I intend to write a story on this for Crikey on Thursday or Friday next week, once the facts are fully established. Would also be happy to be informed of the situation by way of background over the phone if that is preferable.

Regards,
Stephen Mayne

According to reports, an online board meeting of the non-executive directors was convened at midday on Saturday with chair Costello dealing directly and separately with Hugh Marks.

The CEO has very much been trying to control the narrative ever since as he emailed all Nine staff at 3.22pm on Saturday with news of his resignation that did not reference any of these relationship issues.

Annette Sharp from The Sunday Telegraph was also pressuring the company ahead of writing a story. This first became evident in this package on Channel Seven’s 6pm bulletin on Saturday.

Marks then made himself available to multiple journalists for on-the-record discussions on Sunday, once again attempting to control the narrative that it was his decision, that most of the rumours were rubbish and that everything was above board.

It wasn’t until 8.30am on Monday that Nine itself finally put out a statement via the ASX announcements. Given all that has been written, surely chairman Costello should have said more than just one paragraph singing the praises of his CEO.

As it stands, the Nine directors have no public position on the issue of their CEO having at least one relationship with a staff member who reported directly to him.

People like Jeff Kennett have come out swinging saying Marks shouldn’t have lost his job, but if he was planning on leaving in the next 12 months anyway, then resignation was appropriate — particularly given that it won’t take effect until the successor is appointed.

Marks clearly shouldn’t have commenced a relationship with a direct report and once this did happen, he should have promptly told the full board. Failing on both these scores was enough to warrant his departure.

This once again proves that corporate Australia’s has far greater accountability standards than our politicians, given that Alan Tudge and Christian Porter remain in their jobs with no penalty or inquiry seven days after Four Corners told the world about their various escapades.