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The Rise and Fall of Gunns Ltd

por Quentin Beresford

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At its peak, Gunns Ltd had a market value of $1 billion, was listed on the ASX 200, and was the largest employer in the state of Tasmania as well as its largest private landowner. Most of its profits came from woodchipping, mainly from clear-felled old-growth forests. A pulp mill was central to its expansion plans. Its collapse in 2012 was a major national news story, as was the arrest of its CEO for insider trading. Quentin Beresford illuminates, for the first time, the dark corners of the Gunns empire. He shows it was built on close relationships with state and federal governments, political donations and use of the law to intimidate and silence its critics. Fearless and forensic in its analysis, the book shows that Tasmania's decades-long quest to industrialize nature fails every time--but the collapse of Gunns is the most telling of them all.… (mais)
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I recall a friend of mine writing an article about the potential impact of odours from a pulp mill on wine grape flavour in the Tamar Valley. I vaguely recall that it was related to some local political debate about a pulp mill and I can't recall whether he was pro or anti the pulp mill. I have a feeling he was claiming that there would be no impact on the grapes. Though having seen a lot of grapes written-off, in the year of our bushfires, due to "taint" I find it hard to believe that the wine grapes would not be also tainted by the pulp mill emissions. (I've passed Fuji city in Japan many times and sampled the air near their pulp mills.....it's really bad.).
Anyway, this book is not specifically about the proposed pulp mill...though it features very strongly in the story about the rise and fall of Gunns Ltd in Tasmania.
In many ways this is a story about corruption in government and the corrupting influence of big business in Tasmania. But it actually ranges wider than this.
Beresford digs deep to explain the driving paradigms in Tasmania; the idea that Tasmania needed to industrialise; it needed to harness its natural resources; Government needed to support business to get things done and to provide jobs. It probably even goes back to the very early days when "the only good tree was a dead tree"; the settler's battle against nature when survival was at stake. Beresford paints a picture of various State Premiers as strong men; riding rough-shod over opposition; goal driven...where the goal was industrialisation. A corollary of this was an unholy alliance between the State Electricity Commission initially with the flooding of Lake Pedder and then plans to flood the Franklin River (The latter were frustrated by the environmental movement essentially). But as the power of the State Electricity Commission waned, so grew the power of Forestry Tasmania and hand in glove with it grew the power of Gunns Ltd...and its driven CEO, John Gay.
It's a tale of people who only listened to like-minded people and who surrounded themselves with like-minded people. A total inability to see a contrary view. Not only that but positive steps were taken to denigrate and "take-down" decent people who happened to have opposing views. Greenies were the enemy and were dangerous. It was ok to use thuggish tactics against them plus law suits to shut them up etc.
It's also very much the story of John Gay; a man with incredible self belief, charismatic but ruthless at the same time.....willing to "do what it takes" to see his vision fulfilled. A risk taker who managed to build Gunns Ltd from a small timber business into a behemoth.....but whose lack of perspective and inability to see the world changing around him and adapt ultimately led to the demise of Gunns.
There was also a fundamental economic/ecological issue which would bring Gunns unstuck. That was that Gunns was exporting wood chips from native "old-growth" forests in Tasmania but also from their own plantations. They were getting access to the old growth forests at cheap or subsidised prices (courtesy of Forestry Tasmania) and their own forests were insufficient for them to sustain their business on their own.
governments in Australia (federal and state) could see that exporting chips was a fool's mission; they really needed to go downstream and make paper....that's where the real value add lay. Hence the pulp mill proposals. First Wesley Vale (which fell over) then the second proposal for a mill in the Tamar Valley. It was promoted as using Gunn's plantation timbers but the reality was that it would not be economic without continuing access (at subsidised prices) to native, old-growth forests. It just didn't add up economically...let alone deal with the objections of the environmental movements, the greens under Bob Brown, and local residents.
The way that the various opposing forces interacted, their strength in diversity, the power that Geoffrey Cousins brought to the campaigns is an interesting story on its own. And Beresford wryly comments about the irony of the Forestry workers who loved their rural life style and the beauty of the bush and their access to clear rivers and clean air.....at the same time being violently anti "greenie" and being used as shock troops by the bosses at Gunns.
As one who has worked with the service industries I understand the community's disbelief in suggestions that Tasmania's future lay with tourism and high value-added products like art and craft. (And the pure environment and old growth forests were going to be the mainstay of these sort of industries). The person in the street, generally has totally warped ideas about the contribution that mining, agriculture, and manufacturing make to both employment and to GDP (It's 6%, 3% and 5% respectively for GDP......and 3%, 1% and 6% respectively for employment in Australia). Over 80% of GDP and employment comes from the services sectors. Certainly this message did not reach the forestry workers, or, indeed, the ordinary voter in Tasmania....let alone people like Paul Lennon (premier) and John Gay.
I think Beresford has done a fair and workman-like job of forensic sleuthing what was happening in Tasmania and why it was happening. In the light of what we've seen in the USA under Donald Trump, it's sobering to think about the dangers to the community of a paradigm that drives the players and which is used to justify undemocratic, corrupt, thuggish, behaviour....secrecy, poor governance, lack of transparency, lack of diversity in thinking and management. Especially so, when the underlying paradigm is later shown to be false.
A good book. I give it four stars. ( )
  booktsunami | Oct 28, 2022 |
Revealing and confronting. Informative. ( )
  DannyKeep | Dec 1, 2020 |
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At its peak, Gunns Ltd had a market value of $1 billion, was listed on the ASX 200, and was the largest employer in the state of Tasmania as well as its largest private landowner. Most of its profits came from woodchipping, mainly from clear-felled old-growth forests. A pulp mill was central to its expansion plans. Its collapse in 2012 was a major national news story, as was the arrest of its CEO for insider trading. Quentin Beresford illuminates, for the first time, the dark corners of the Gunns empire. He shows it was built on close relationships with state and federal governments, political donations and use of the law to intimidate and silence its critics. Fearless and forensic in its analysis, the book shows that Tasmania's decades-long quest to industrialize nature fails every time--but the collapse of Gunns is the most telling of them all.

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