Chairman Makes The Rules At ADM

At precisely 2:00 p.m. on Thursday, Oct. 19, Dwayne
Andreas, Archer Daniels Midland's chairman and
chief executive, called to order the company's 72nd
annual meeting in the gymnasium of a former school
that now serves as ADM's Lakeview Center in
Decatur, Illinois.
Quickly, Andreas moved to the first order of
business: a listing of the directors "who will be
elected." He read the names of all 17 current
directors, and asked for a single motion to adopt
the slate in one swoop. A rapid "So moved" and "I
second" floated up from the assembled crowd.
Andreas asked if there were any other nominations.
A split second later he said, "Hearing none, I
declare the nominations closed."
Startled by the fast action, several stockholders
shot out of their folding chairs crying, "Point of
order, Mr. Chairman." Andreas acknowledged their
existence with a curt, "There will be time for
questions later."
He then called for the vote. Again three
stockholders rose to challenge Andreas's slam dunk.
Again Andreas put them off. One angry shareholder
loudly grumbled, "This meeting shows just how this
company is run."
Taking the bait, but with little inflection in his
voice, Andreas retorted, "This meeting, sir, runs
according to my rules."
Indeed, the meeting was dominated by Dwayne's Rules
of Order. Just what those rules are, however, was
made plain a little later when all the corporate
apple polishing was interrupted again by a
sarcastic stockholder who asked, "Just what are the
rules?"
"I make the rules as I go along," replied Andreas
tartly.
Evidently that is not uncommon for ADM. Some of its
rulemaking is now under investigation by a federal
grand jury in Chicago. One alleged rule, as
reported by the Wall Street Journal, states
"Competitors are friends; customers are our
enemies."
During the annual meeting, Andreas himself showed a
stunning gift for both making and interpreting
rules.
In his introduction of Brian Mulroney, an ADM
director and former Canadian prime minister,
Andreas fired back at critics who claim ADM's
corporate directors are too cozy with the boss (10
of the 17 are either past or current ADM executives
or relatives), overpaid (each non-employee director
earns US$100,000 a year), and underworked (the
board meets five times a year).
Andreas noted that Mulroney, as Canada's past
leader, was present at the creation of the
international economic Group of Seven and played
key roles during GATT and NAFTA negotiations.
And, continued his boss, "He was a recent weekend
guest of Yeltsin. He was a week-long guest of the
Prime Minister of China. He has been with Mr.
Mitterand of France and Mr. Kohl of Germany - all
countries where we have business interests."
In sum, said Andreas, ADM "shareholders get a big
bang for their buck" by having the "Right
Honourable Brian Mulroney" on the ADM board.
Later, when Andreas took questions from the floor,
one shareholder asked if ADM had lobbied "Gingrich
and Congress" recently to preserve ethanol's
federal tax exemptions.
No, said Andreas. "In the first place," he
explained, "we do not deal with Gingrich." Then, in
direct contradiction to his just-concluded praise
of how Mulroney is plugged into the international
political power grid, Andreas added: "For 20 years,
we have not lobbied Congress for anything."
At least not directly. Since 1979, however, ADM,
the Andreas family and the ADM political action
committee have given over US$4 million to the
Democratic and Republican parties and their
candidates, according to political watchdog groups.
In a town where money speaks, ADM already has a
loud, clear voice. Lobbying would be redundant.
That seems to be another ADM rule - put your money
where your mouth is and then shut up.
Which is precisely what Andreas did Oct. 19. About
the time Andreas adjourned the rancorous meeting,
ADM's battered stock was closing 50 cents higher on
Wall Street. The rise was tied to ADM's
announcement that day it would double the quarterly
dividend and buy back 25 million shares of its
stock.
Alan Guebert writes from the Corn Belt. 

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