Only your INTEREST can protect your INTERESTS
I have no idea who sent me this blog site but democracy works in mysterious ways.
The TAC Magazine will not publish anything controversial and indeed fails to address the need for creating transparency. It is the logical forum for discussion of important issues relating to the club, its financial health and its future but is, at best, a bland and expensive presentation of the the irrelevant.
In various discussions on the re-development project, no-one has really addressed the issue of the vested interests.
I believe the Board has integrity.
Less clear is the role of the management and whether their interests are aligned with those of the members on this issue. With this in mind one must understand that management has, in effect, now taken control of what is being trussed up as a fait accompli.
It also appears that a majority of members have no personal financial interest in the process as their membership is part of an ex-pat package and not perceived to be relevant to their own pocket.
Why rock the boat and why raise issues when it could well become a career limiting move.
All that is required for approval of the re-development plan is a majority of a quorum, worst case about 301 votes from a required 20% quorum of about 600.
With indifference the normal state of affairs, a carefully targeted presentation by a skilled PR agency (which you are paying for) can finesse the result.
I do believe, however, before the inevitable happens that there are a few points of order that need addressing in some sort of democratic forum...which by the way, TAC is not.
The first goes back some ten years when the Club was first diagnosed with cancer.
‘Your Club is in a bad way’...the consultants said.
The primary source of this illness was (and still is) salaries.
Let’s take 1983 as the base 100 year.
In 1983:
Salaries: Yen 1.3 billion
F&B: Yen 1.27 billion
Membership: 2,604
F&B/Mbr: Yen 488,000
Let's follow these figures:
1990: 168/129/129/100
2000: 177/118/130/92
2005: 153/86/137/63
2006 Budget: 168/89/138/64
In this financial year your club has budgeted for salaries to climb back to 70% of operating revenue.What is happening?
Average salary per permanent worker is Yen 10 million. More like yen 6 million inflated by ex-pat packages that are actually not fully disclosed in accounts because a lot of cost is deferred and paid off-shore.
How many of the members can retire after working in company for 5 years with a USD 1 million payout, on top of a very reasonable package. Not many I suspect. But that has been and is the reality with the last 3-4 managers of your club, and will be the reality for the next retiree from the post.
The point of all this is that the interests of the members are not necessarily those of the employees.
Should the tail to be wagging the dog?
The club re-development is a major project and should it go wrong, the financial implications are beyond the comprehension of most members.
While there is any chance that this could go wrong, spectacularly wrong, the call for total transparency and analysis of worst-case scenarios should grow stronger.
Perhaps this forum may help to get more members involved in the discussion before the vote…and remember that 51% of a quorum of 20% of the members can decide the fate of the club.
posted by Unlock at 3:38 AM
5 Comments:
annual cost to TAC for average FT staff is about Y10mm. (this is not salary)
Quite a shocking situation when summarized in a no BS way like that.
The off-shore payment of salary to management members (GM and AGM maybe?) is something I'm sure the membership would ALL like to know something about. How to get this information into the open?
I do not see many lights on in the Azabu Towers block these days. That means the cash flow has dried up whilst the liability overhangs the balance sheet.
Does this mean that the club has gone beyond the point of no return on the development before the vote?
I think the membership needs to know what irreversible financial commitments have been made ahead of the vote and...
If the membership does not vote in favor of the proposal, what financial commitments have to unwound and at what cost?
This is not a poker game in the Traders Bar....we need more transparency ahead of the vote not more PR from hired guns.
Cost of labor in Japan is salary and employer commitments to pension and insurance. The add-ons vary from 10-15% depending on several factors.
I stand corrected...cost of FT staff not salary.
It is still extraordinarily high, especially as I believe the full cost may not be brought to book each year due to the structure of deferred commitments.
As I understand the situation, Azabu Towers is in a separate 'Special Purpose Corporation'based in the Cayman Islands. As such it does not sit on TAC's balance sheet per se, although there must be some back-to-back guarantees given by the club.
The financing is structured around large bullet payments, one of which is due this year. That is probabl;y why the cash effect of the place being emptied is invisible at the moment.
I do not understand why a club would go through such a convoluted financing process unless there were people involved in who fancy themselves in structured finance and wanted a little practise with no downside. The fees involved are significant.
The whole thing seems like massive overkill when it would have been far simpler to just buy the place outright in the first instance.
With a large bullet payments looming there is obviously additional pressure to get the redevlopment away ASAP and just pour the whole thing into the big pot where it will not be noticed ....for the moment at least.
This is meant to be a club not an incubator for budding investment wannabes.
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