TRANSNATIONALS
TRANZ RAIL 'CORPORATE GREED' WINS ROGER AWARD FOR WORST COMPANY FOR THIRD TIME

Tranz Rail has won the Roger Award for New Zealand's worst transnational corporation for an unprecedented third time, Foreign Control Watchdog reports in its latest issue. And the company was accused of "corporate greed".

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Tranz Rail has won the Roger Award for New Zealand's worst transnational corporation for an unprecedented third time, Foreign Control Watchdog reports in its latest issue.

And the company was accused of "corporate greed".

The organisers also made a special "collaboration award" to the Labour-led coalition government for "failure to assert the public good against corporate pressure at a critical point".

Its "proud" record is victory in the first year, 1997; a continuity award in 1998; victory again in 2000 and a position on the short list in all six years of the award.

It would, sadly, have been worthy winners every year, as the input of the public to this award testifies.

The judges for the award, announced in Auckland on Friday night, were Dunedin mayor Sukhi Turner; Victoria University academic and feminist Prue Hyman; Dr Ranginui Walker, Emeritus Professor at the University of Auckland; and John Minto, national chairperson of the Quality Public Edication Coalition.

Also on the shortlist of worst transnationals were timber company Carter Holt Harvey, last year's winner; Novartis Seeds, now part of ther world's largest agrochemical and seed company, Sygenta; Shell/Shell Todd Oil Services; Telecom; and Auckland's Sky City, which operates Sky Casino gambling interests.

Tranz Rail has taken a major community asset and run it into the ground over a period of 10 years. The effects are not only to be worn by the community as a whole in terms of needing to fund an upgrade because of poor maintenance of the infrastructure, but the company's appalling safety record leaves one aghast.

NZ Railways was a public utility built up progressively over 100 years by the taxpayers of New Zealand. From its inception in the 1880s to its privatisation in the 1980s, NZR built up a huge capital asset comprising the network of lines, tunnmels, bridges, deviations and stations that linked the major towns and cities of New Zealand.

In addition, it accumulated rolling stock and locomotives, which it maintained and replaced when necessary, including the switch from steam-powered locomotives to diesel engines in the 1950s-60s.

Permanent rail gangs were employed to maintain the lines. NZR transported New Zealand produce to the ports for export, and thousands of passengers in safety.

Since privatisation, the company has cut staff, services, safety and many corners.

Recently, the culture of corporate greed has included extended depreciation, asset stripping and inflated income through creative accounting, with track renewals treated as capital expenditure and the costs added to fixed assets rather than treated as a deduction from revenue, practices which fooled the sharemarket into thinking that Tranz Rail was in good heart and its shares worth buying.

Profits were also artificially inflated by the sell-off (and lease back) of the Aratere ferry for NZ$55 million and of rolling stock for $93 million.

This generated a profit of $90 million. The hidden cost is the lease commitment of $542 million on these two deals over the life of the leases. These sharp practices initiated a recovery in the share price to $3.50 and $3.70 a share, whereupon Fay Richwhite and Wisconsin Central sold out in February 2002.

In September 2002 these shares were worth only $1.70, an indication of what the robber barons had done to Tranz Rail.

The other downstream effect of the failure to deliver service to customers is the proliferation of juggernaut truck and trailer rigs on our roads transporting logs and containers that should be transported by rail.