Today was a banner day in the storied history of Crown casino. After being pushed as close to the brink as possible, Australia’s historically leading casino snatched victory from the jaws of defeat. After committing a multitude of sins so vast and so cataloged that I won’t bother to repeat them, Crown somehow has come out of the quagmire and finds itself a big boy again, with its very own casino license, and no longer needing a baby-sitter. The Victorian regulator has waved its magic wand and given Crown a second chance at life after what can only be described as a corporate near-death-experience.
Congratulations are in order to Ciarán Carruthers, the CEO of Crown Resorts. After nearly two decades in Macau at Galaxy, Sands China and Wynn Macau, Carruthers took on the scariest job in the APAC IR industry – CEO of Crown – at a time Crown was being pummelled from all directions by all sectors of Australian society: the media, the regulator, the government, social commentators, anti-gambling crusaders, and worst of all in Australia, the “man in the street”.
Of course it was a team effort, but Carruthers was at the helm, and to the victor go the spoils. But as Carruthers himself has already acknowledged, this road to redemption is but the first part of his job, and all it does is get him – and Crown – to the starter’s gun. But without having got over the suitability hurdle first, nothing else Crown could do really held any significant meaning.
Today’s 40-minute press conference was fascinating. I’m not normally a fan of gaming regulators, especially those who have little gaming business background and a lifetime of government service. But credit where credit is due – Fran Thorn, Chair of the Victorian Gambling and Casino Control Commission (VGCCC), did an excellent job in today’s presser. She played some silly media questions with a very straight bat, and simply told it like it is.
The Australian media are always baying for blood when it comes to casinos. And so it was today, when Thorn was asked, “How many people have individually suffered any consequences?” Thorn quite rightly stood her ground and explained that that was not a matter for the regulator, noting that financial regulator ASIC has the powers to “take action against the company, the organization, if they behave criminally or inappropriately.” I would personally add that if any individual has acted criminally, isn’t that simply a matter for the police and the public prosecutor?
Another journalist asserted that Crown had merely been given a slap on the wrist, since they finally ended up getting their license back. I don’t know that AU$700 million in fines, hundreds of millions more in losses through massive remediation expenses, and years and years of public humiliation and being dragged through the mud is a “slap on the wrist”. The pain and total metamorphosis that Crown has had to go through – with a new owner, a totally new Board and completely new management – is patently obvious to see.
When asked, “What would it have taken for Crown to lose its license?” Thorn simply replied, “To not have acted on remediating the failings [identified by] the Royal Commission. And they have acted. Very substantially. And at great cost to them.” A plain, simple and clear answer. And for further clarity on this, just compare and contrast what Crown has done side-by-side with the utter mess Star Entertainment finds itself in, highlighted by the resignation of former CEO Robbie Cooke on Friday in the face of a second Bell inquiry into Star’s suitability.
On a personal note, despite a rocky frenemy relationship with Crown over the decades, I’m glad to see Crown regain suitability. Crown has always been the leading casino in Australia, and to see what it had become was saddening. Today’s decision is a second chance, an opportunity for Crown to turn the corner and head down a road to redemption and eventually become again what it once was, if it’s prepared to take a long-term view.
My relationship with Crown casino in Melbourne goes right back to before the opening of the temporary casino at the Galleria in the World Trade Centre on 30 June 1994. I was there on the opening day, queueing up alongside what seemed like half of Melbourne. I was also there at the opening of the permanent casino at Southbank on 8 May 1997, and I even lived for a number of years at Southbank Towers, diagonally opposite Crown’s flagship high roller Mahogany room, just a 30 second walk from Crown. A walk I took multiple times per day, for years.
So, safe to say, I know that place, and that company. I’ve spent countless thousands of hours at Crown Melbourne. I’ve witnessed their incredible arrogance, their aggressiveness, their “we know best” attitude. I fought with them and admired them, simultaneously. I also witnessed their golden years, when they became a beloved institution in Melbourne, around the first decade of the new century. And I witnessed their slide back into becoming a sleazy, cynical and arguably predatory organization during the James Packer years.
Under Blackstone and CEO Carruthers, and with today’s decision, a new day has dawned at Crown Melbourne. What remains to be seen is whether they can take this second chance at life, maintain a straight and narrow trajectory, honor their ethical and moral obligations, fulfill their legal and social licenses, and rebuild a sustainable business model that can work in the years and decades ahead.
There is no doubt Crown was a bad actor for a long time. But they have worked tirelessly at redressing that kind of behavior, to emerge as a completely different company with a completely different attitude.
Just like all of us, they deserve a second chance.
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