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James HardieJames Hardie is an industrial building materials company headquartered in the Netherlands, specializing in fibre cement products. History James Hardie immigrated to Australia in 1888 from Scotland, and created a business importing oils and animal hides. Andrew Reid, also from Scotland, came to join Hardie in Melbourne, and became a full partner in 1895. On Hardie retiring in 1911 he sold his half of the business to Reid. James Hardie Industries Ltd. listed on the Australian Stock Exchange in 1951. In December 2001, the company shareholders unanimously voted to restructure and relocate the company in the Netherlands as a parent company. Asbestos products and controversy James Hardie was also involved in selling asbestos related products, however many of these products resulted in people developing asbestosis and mesothelioma. In 2001 it set up the Medical Research and Compensation Foundation to provide financial compensation for victims of asbestos related diseases caused by their products. The foundation chairman, Sir Llewellyn Edwards, has criticised James Hardie for providing insufficient funds for settling claims from victims of asbestos related diseases. The company has been accused of not handling their liabilities to these victims properly. A number of factors were included as part of the allegations, such as its restructure, resulting in the move to the Netherlands, and its reorganization of the business relationships between related companies, which were claimed to minimise financial exposure to employees who had become sick after working at its asbestos mines and manufacturing plants. These allegations were the subject of a judicial inquiry in New South Wales (Australia). The findings were very critical of James Hardie and its management. Subsequent to the inquiry, prosecutors were considering bringing charges against the C.E.O. amongst other senior executives. On 10 August 2004, James Hardie Industries announced strong profits. A day later, it announced the resignation of its Board Chairman Alan McGregor due to ill health, and that he had been replaced by director Meredith Hellicar. Another day later, John Sheehan, the senior legal counsel assisting the inquiry, made recommendations that the company's chief executive officer, Peter Macdonald, be charged with fraud. (These charges carry a maximum penalty of 8 years in prison and fines of A$350,000; James Hardie could also face fines of A$1.75 million.) The basis of charges are a February 2001 press release where the company claimed the adequacy of its compensation fund was based on expert advice from accountancy firms which, allegedly, effectively misled the public and the Australian Stock Exchange. External links News items related to inquiry
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