The McKinsey Report
In 1983, the VFL appointed McKinsey to look into its administration. The League had been plagued by clubs reporting financial issues and the league itself wasn’t in great shape.
Amongst McKinseys conclusions were that the VFL Board had never really had a clear and binding authority to take control of the game and make the necessary decisions on methods to arrest the financial decline of the league and possible collapse of some clubs.
The McKinsey report proposed that the league change its management structure, and adopt an independent commission.
By October 1983, a tasforce under David Mandie had been set up to investigate and make its own recommendations into the leagues governance.
Elliot and the Macedon summit
On 4 September 1984, at Sefton in Mt Macedon, Carlton president John Elliot led a meeting that proposed a national competition, and a change in the way the game was managed. According to Ross Oakley, Elliot was even prepared to leave the VFL in charge provided they became an independent commission.
One of the key points of Elliots proposal was “the establishment of a four-man board that would include a commissioner and three other members, with the commissioner having, effectively, autocratic powers, tempered marginally by the other members whose role “constitutes an Appeal Board function to decisions made by the Commissioner”.
Elliots proposal was eventually folded into the the existing Taskforce Mandie which finally reported on October 1, 1984, and then on November 7 the VFL Board endorsed in principal the Task Force recommendation that the existing VFL Board of Directors structure be replaced by the appointment of a full-time Commissioner and four part-time Commissioners to conduct the administrative affairs of the League on a trial basis.
A subcommittee, of Tony Capes (Footscray), Ron Cook (Hawthorn), Leon Wiegard (Fitzroy), Greg Sewell (Essendon) and Bob Ansett (North), was appointed to choose the commissioners. The subcommittee made Ansett, North’s president, its chair.
The VFL Commission
At the board meeting of 21 November 1984, Ansett had tabled the subcommittee’s recommended terms of reference for the appointment of the VFL’s inaugural commission, noting it favoured “retention by the board of all policy and strategic decisions”.
The sub-committee had given detailed consideration to the proposed amendments to the League’s Articles of Association and Rules and also the Terms of Reference for the operation of the proposed
- (a) The VFL establish a Board of Commissioners to be called “The Commission”.
- (b) The Commission comprise five Commissioners, one full-time and four part-time; the full-time commissioner to be called “the Commissioner” and the part-time Commissioners to be called “the part-time Commissioners”.
- (c) The Commission have such powers as the League may from time to time delegate to it on the basis that any delegation of power may be revoked or made subject to conditions at any time by a resolution passed by a simple majority at a meeting of the League.
- (d) Initially, the League should delegate to the Commission for a period of one year all powers exercisable by the League other than the specific major powers referred to in the draft resolution annexed to these minutes
The subcommittee also put forward the names of the four men to sit on the first commission: Graeme
Samuel, Peter Scanlon, Peter Nixon (all newcomers to football administration) and Dick Seddon,
once CEO of Melbourne and a long-time club delegate on the VFL Board. They would be joined by Ross Oakley and Alan Schwab.
December 4, 1985 is one of the most significant dates in the history of football because it forever changed the way football is administered.
On that date the VFL Board of Directors voted to appoint a commission with specific powers to run the competition. Before that historic vote, the competition had been run by a board of directors consisting of a representative from each club.
The vote by the board of directors referred all powers and responsibilities to the Commission to run the competition with the following exceptions where the clubs retained the power:
- to admit any club, or expel or suspend any club
- to amalgamate or join any other league
- to take over the administration of any additional football club
- to approve the move of clubs out of Victoria
- to provide any financial assistance to any club (other than by payments of advances of dividends) or to guarantee the obligations of any club.
- except as expressly authorised in any budget approved by the Board of Directors, to purchase or dispose any capital asset with a cost of more than $100,000.
- except as expressly authorised in any budget approved by the Board of Directors, to borrow any money otherwise than for the ordinary purposes of the league or give any security for any such borrowing.
- to undertake any major capital works (including major works in relation to existing assets of the league) involving a total expenditure of more than $100,000
- to exercise any of the powers of the League in owning any television or radio station.
- to appoint representatives of the league on the National Football Championships Pty Ltd
- to amend any laws of the game.
That structure continued until August 11 1992, when the AFL Board of Directors accepted a recommendation from the AFL Commission to conduct an independent review of the AFL administrative structure. Mr David Crawford, a senior partner of KPMG was subsequently appointed to conduct the review.
On August 11th 1992, the AFL Board of Directors adopted a recommendation from the AFL Commission to conduct an independent review of the AFL administrative structure examining specifically:
- the respective roles and responsibilities of the Commission, Board of Directors and management of the AFL.
- the structure of the Commission, Board of Directors and management of the AFL
- the relationship between the Commission, Board of Directors, management of the AFL and the clubs.
Mr. David Crawford, a senior partner in the firm KPMG Peat Marwick, was subsequently appointed to conduct the review.
The Crawford Report
On March 1, 1993 Mr. Crawford presented his report to the AFL Board of Directors and the AFL Commission. The Key Recommendations in the report were as follows:
- The Commission should be retained.
- The clubs should be given the right to appoint part-time Commissioners who would be appointed for 3 years at the annual general meeting of the AFL. While the clubs and Commission may nominate people to become part-time commissioners for election at the General Meeting, only the representative of a club may vote in the event of an election.
- The Commission be restructured to provide for up to 8 commissioners to be appointed, including at least two Executive Commissioners. There should always be a minimum ratio of part time commissioners to executive commissioners of 2:1.
- There should be a Chairman appointed by the commissioners from amongst their number who should not be the Chief Executive Officer. The Primary role of the Chairman would include:
- Chairing meetings of the commission – if necessary he would have a casting vote
- Chairing meetings between the commission and the clubs
- Being a sounding board for the Chief Executive Officier
- The Chief Executive Officer appointed by the commission would be a commissioner as a matter of right while retaining his position as CEO and would therefore not be subject to re-election as a commissioner. He would be a voting member of the AFL Commission. The role would include being
- responsible for the operating performance of the AFL.
- responsible for the implementation of policy as decided by the Commission.
- the public face of the Commission.
- Executive Commissioners, other than the CEO shall be appointed commissioners by the Commission but shall not be voting members of the Commission.
Recommended Powers of the Commission
With the exception of 1) the appoint of Commissioners at Annual General Meetings and 2) the implementation of a Commission decision to admit, expel, relocate or merge a club without clubs being consulted;
The Commission be granted the power and authority to take all decision relating to all aspects of the AFL. Other recommendations included
- Holding quarterly information meetings between the Commission and representatives of the clubs
- continuing the monthly meetings between the Commission and club general managers.
The VFL Board of Directors accepted the reports recommendations on March 9th, 1993.
Acceptance and Implementation
On July 19, 1993, the Board of Directors unanimously approved new Memorandum and Articles of Association which reflected the recommendations of the Crawford Report.
The Date was effectively the last meeting of the Board of Directors as the Crawford Report recommended that all powers and responsibilities to run the competition be referred to the AFL Commission.
The Clubs however retain specific powers in relation to the admission, relocation and merging of clubs.
Any decision by the commission to admit or relocate a club or approve the merger of clubs can be reversed by the clubs at a duly constituted meeting of clubs called within 14 days of receiving formal notice of a Commission decision to admit, relocate or approve a merger of clubs.
A two thirds majority is required to overturn any such decision by the commission. Three clubs may requisition a meeting of clubs to reverse a decision by the Commission to admit or relocate or approve a merge of clubs. Clubs cannot be merged unless the clubs who are party to the merger first agree.
Clubs also have a reserve power on the possible expulsion of a club from the competition. Any decision by the Commission to expel a club must be ratified at a general meeting of clubs by a simple majority.
While the AFL Commission was given wider powers to run the game when the recommendations of the Crawford Report were adopted, Clubs retained the right to appoint the Commission.
Composition of the Board, Elections and Removal
- The Minimum number of Commissioners is six
- The Maximum number of Commissioners is nine
- No more than a third of Commissioners can be executive Commissioners, including the CEO.
According to Article 42 of the Articles of Association, any club appointee or Commissioner can nominate a person to fill a non executive seat on the Commission. The AFL may also appoint a Commissioner to fill a vacancy on the Commission without election after consultation with the clubs (Article 48).
Article 39 requires that two Commissioners retire at each election to be either replaced or re-elected. Article 40 requires that these be the longest serving commissioners.
Article 51 lists the ways and reasons a Commissioner can be dismissed. The Articles do not appear to give the club appointees a means to dismiss a Commissioner outside of these.
So who controls the AFL?
Note: David Forbes wrote an excellent blog piece on this here.
The AFL is controlled by its members, who in turn elect the Commission. However the “AFL members” arent the people out there buying AFL memberships. It boils down to 18 people appointed by the leagues clubs – Essentially the AFL board of directors became the voting membership (there are two hundred odd non voting life members of the league), and it is these appointees who elect Commissioners.