By Tess Bennett
WiseTech Global has appointed a loyal lieutenant of its controversial chairman Richard White with almost no chief executive experience to run the $40.2 billion-valued software maker, raising concerns about his ability to stand up to the group’s billionaire founder.
Zubin Appoo was named as the global logistics software giant’s new chief executive after a search for a permanent replacement that lasted more than nine months. He will lead a company where White still holds enormous influence as its executive chair and chief innovation officer.
White resigned as chief executive in October after a board investigation concluded he had misled directors following reports by The Australian Financial Review that he had paid out several women, including a former employee, to settle personal matters.
“Some funds would have preferred a candidate … who had demonstrated the ability to lead a large global tech firm and had the metal to stand up to the founder when needed,” RBC Capital Markets’ technology analyst Garry Sherriff said after speaking to some WiseTech investors, including large super funds.
A spokesman for superannuation fund HESTA, which has previously threatened to sell down its 0.6 per cent stake, said it had been looking for a new chief executive to take responsibility for strategy and innovation, to rebuild investor confidence.
“We are looking for the new CEO to drive cultural change, demonstrate independent thinking and constructively engage with investors,” the spokesman said. “This is a critical appointment for WiseTech to get right, given it is designed to begin a path toward long-term succession, including transition of key functions.”
Australian Shareholders’ Association chief executive Rachel Waterhouse said she was concerned to see an ASX20 company appoint a CEO with no listed company leadership experience. She said this left concerns that decision-making power was concentrated in White’s hands.
“Effectively, the power sits with [White] within the organisation. It’s masquerading as an ASX-listed company, when, in fact, it’s operating like a private company in many ways,” Waterhouse said.
“How much of a real global search did [the board] do if they just went into their own backyard and picked someone internally who is probably going to be quite compliant with their existing reporting lines and executive chair and founder?”
Whether Appoo can be that man will come down to his ability to step out of the shadow of White, the executive chair and chief innovation officer, who founded WiseTech in 1994, and has been his boss for most of the last 20 years.
Appoo has been close to White’s since 2004 when he first joined WiseTech. He was part of a handpicked group to undertake a training course alongside White and a small group in 2005, where they learned the Theory of Constraints – described as “a methodology for turning bottlenecks into accelerators”.
This group drove the creation of CargoWise, WiseTech’s most important product, which helps co-ordinate freight, and “The WiseTech Way”, a set of strategies, tools and processes that dictate how the company operates.
Appoo initially worked at WiseTech between 2004 and 2018, before returning this year as deputy chief innovation officer, reporting to White.
“As WiseTech enters the next phase of its growth trajectory, it is imperative that we have a strong succession plan in place,” White said.
“Since rejoining WiseTech … Zubin has been working closely with our senior leadership team, our development teams, as well as customers, and investors. He has immersed himself in WiseTech’s business operations with a focus on driving innovation, value creation, and efficiencies.”
Andrew Cartledge has been acting as interim chief executive since October, after being chief financial officer since 2015. He will retire at the end of the year.
WiseTech insider
During his first stint at the company, Appoo worked closely with White to integrate two of the software giant’s many acquisitions – TradeFox and Digerati – which became its BorderWise product, a compliance platform that calculates duties and taxes at customs. His name also appears on a handful of patents alongside White’s.
“I am a strong believer in WiseTech and have been a shareholder since 2005. I’ve been a part of, and witnessed, the immense impact WiseTech continues to have on the global logistics industry,” Appoo said.
Between his stints at WiseTech, Appoo was the chief technology officer of the payments business InLoop which incubated LanternPay before it was sold to NAB subsidiary HICAPs in 2022.
His only previous chief executive role was at the Uniting Church’s online marketplace Find a Carer – a website that connects older Australians or those with disabilities.
Appoo will be paid $1.4 million a year, split equally in cash and equity, as well as the option to earn up to $1.05 million in share rights if all performance targets are met. In his new role he will oversee WiseTech’s largest-ever acquisition, the $3.2 billion purchase of Texas-based competitor e2open announced in May.
Last week WiseTech told its 3500 employees it is increasing the use of artificial intelligence across the business as part of a broad restructure of the ASX-listed logistics software giant that will result in redundancies.
RBC Capital Markets’ Sherriff said some investors would be happy with the appointment, figuring Appoo has lots of experience of how WiseTech operates and could “play on and grow the business and the margins”.
WiseTech shares were flat on Monday, trading at $120.50.
Hailey Kim, an investment analyst at Wilson Asset Management, which holds WiseTech shares in its WAM Leaders fund, said the appointment appeared to be a “continuation” of WiseTech’s existing strategy.
“It was slightly surprising that it wasn’t an external candidate, but still, [Appoo] has a history with a WiseTech team. I’d assume that he’s a quite well-known entity internally, which is positive because it will minimise any disruption,” Kim said.
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