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The Australian
November 15, 2003

Lowy: "I am not driven by greed."

Frank LowyI earnt my $12m bonus: Lowy

By Teresa Ooi

BILLIONAIRE Frank Lowy has defended his $12.38 million bonus and refused to step down as head of Westfield's remuneration committee despite growing shareholder concerns.

"I am not driven by greed," Australia's third richest man and highest paid executive told shareholders at the annual meeting in Sydney yesterday. "I am driven by what I think is proper.

"I provide two things to the company. I contribute capital, like you, and I contribute my labour. I believe I am entitled to be paid for my labour irrespective of how much of the company I own."

The Westfield Holdings executive chairman's contract paid him $13.39 million 2002-03, up from $11.92 million a year earlier.

It includes a base of $932,000 and a bonus of $12.38 million this year.

But Mr Lowy defended his record, saying he headed an international group of three companies with assets worth $32 billion and a track record of 43 consecutive profit increases.

"If there is no profit, there is no bonus," he said.

In May [2003], Mr Lowy announced plans to donate $30 million from his salary to establish a think tank called the Lowy Institute for International Affairs.

While that gesture won applause, investors have been concerned that Mr Lowy heads the Westfield remuneration committee while holding the title of highest paid executive in Australia. The News Corporation Ltd's chairman and chief executive Rupert Murdoch and chief operating officer Peter Chernin are paid more, but both are based in the US.

Giles Edwards of the Australian Shareholders Association questioned at the meeting whether there was a conflict of interest for Mr Lowy to be chairman of the remuneration committee.

"Would it be too much to ask that you simply absent yourself and have a truly independent remuneration committee? Otherwise, the perception in the market is that you are the judge and executioner of your own salary. And that's not good business practice," Mr Edwards said.

But Mr Lowy said it was "entirely proper and it makes good sense" for him to play a key role in setting pay for senior management.

"I know the executives, I see their performance. I have worked closely with most of them for several years. I am able to provide an internal perspective of senior management while the independent directors provide an external perspective."

When pressed whether he should step down from the remuneration committee in line with good corporate governance, he said: "There's a binding contract between Westfield Holdings and myself. The company cannot change it unilaterally. I have to agree to make a change. I thought about it long and hard. I got advice and I decided now I will not change it.

However, given shareholders' discomfort, Mr Lowy said he would review the matter.

"Having regards to the sentiments, we will consider it -- and I don't say I will, and I don't say I won't (step down).

"There is a perception when people talk about salary that I take so much out of the company.

"It's like my own decision ... we have a very vibrant and strong board that deals with all issues and this will be one of the issues the company will deal with."

Mr Lowy, who turned 73 last month, also dismissed any suggestions that he would would retire soon.

"I want to be in the chair of the company, I want to leave it a day before I have to.

"I'm doing well, I feel good, I'm strong. I think I've got my marbles and until I cannot make a contribution, I'd like to stay ... (I have ) no plans to retire."

Our website dossier on the origins of anti-Semitism
Frank Lowy has business and political interests in Israel and is seeking to develop shopping centres across Britain: a veteran campaigner on Jewish causes
Lowy had recently acquired 99-year lease for the 425,000 square foot retail portion of World Trade Center before the WTC attacks of Sept. 11, 2001 reported The Jerusalem Post on Sept. 12.
Jewish donors like Lowy were among the biggest corporate and individual contributors to party political funds in 2001 and 2002

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