Ruth Richardson, the chair of the board of Morningstar Research Pty Ltd, has stepped down from the position after failing to receive assurances from the US directors regarding issues of corporate governance and business performance.
Richardson has been a director of Morningstar Research Pty Ltd since April 1999 and says she was the only independent member on the six person board.
According to company information obtained from the Australian Securities and Investment Commission (ASIC), the other board members are Graham Rich, chief executive and publisher of Morningstar Research Pty Ltd and members of the Morningstar Incorporated board, based out of the USA.
These board members are Don Phillips, managing director, Tao Huang, chief operating officer, Joe Monsueto, chairman and chief executive and Bevin Desmond, president, all of Morningstar Inc.
Richardson says her position on the board was at the discretion of the research house’s owners and she had maintained a committed view on the standards of corporate governance.
“I drew lines in the sand regarding issues concerning business performance and corporate governance and said without assurances I was not prepared to continue,” Richardson says.
“The US directors could not meet those assurances and since I hold strong views on these [issues] I stepped down. It is time for directors to stand up on such matters.”
Richardson would not elaborate further on the particulars of the business performance and corporate governance issues due to the upcoming court hearing on Friday involving Morningstar Inc and Rich. Rather she says the issues would be made clear in court.
However in a statement Morningstar Research Pty Ltd chief executive and publisher Rich says the court case centres on claims that Morningstar Inc. as majority shareholder has acted in an oppressive manner against Fiduciary, a company which is a minority shareholder in Morningstar and owned by Rich.
As such, Fiduciary is seeking damages against Morningstar Inc. and also alleges that representatives of Morningstar Inc. on the board of Morningstar Research Pty Ltd have acted in breach of their duties as directors of the Morningstar Research.
Fiduciary also claims that Morningstar Inc. has breached the terms of the joint venture agreements between the two shareholders of Morningstar Research Pty Ltd.
