September 20, 2022 | By Bronwen Largier

The Star Entertainment Group’s interim chairman has offered a “sincere and unreserved apology” on behalf of the organisation and pledged that the business will do better following the release of a damning report into The Star Sydney’s conduct last week.

Not the first investigation of Australia’s casino industry

The review was commissioned by the New South Wales government through its Independent Liquor and Gaming Authority (ILGA) and overseen by an independent head, Adam Bell SC. The report, released publicly last Wednesday, found the The Star Entertainment Group unfit to hold a gaming licence.

The review comes after similar investigations into Australia’s other major casino business, Crown Resorts, which found that business unfit to hold casino licences in the three states in which it operates – Victoria, NSW and Western Australia. In NSW, which held the first inquiry into Crown’s operations, the granting of Crown’s licence for its new Barangaroo casino was delayed by more than 18 months.

Falling short

The Star Entertainment Group’s current interim chairman Ben Heap released a lengthy statement to the ASX late last week saying the report made for “difficult reading”.

“We acknowledge its findings and recommendations and the gravity of the matters as set out in the report,” he wrote.

“We also acknowledge the public criticism of our governance, behaviours and culture, including by the NSW Independent Casino Commission chief commissioner, Mr Philip Crawford.

“We have fallen short of expectations. The people of NSW placed their trust in us as the holder of a casino license, and we have not lived up to that trust. For that we offer a sincere and unreserved apology.

“We recognise the seriousness of the matters raised by Mr Bell and Mr Crawford and we are determined to address them and to do so with urgency,” he wrote.

Cultural changes

Heap said cultural transformation was among the group’s immediate priorities.

“It is clear from the report that we need to fundamentally transform our culture. We need more transparency, more robust governance, and greater accountability.

“At its heart, we need to be a workplace where our team members feel free to raise concerns, where we have open and honest dialogue with our regulators and Independent Monitor, and where our leadership is both vigilant and listens when concerns are raised. We need to ask not only ‘Can we?’, but ‘Should we?’, and act swiftly where there is an issue.

“I accept that there have been times we’ve been arrogant and closed off to criticism. That will not be the case in the future.

“Our goal is to earn back your trust and the trust and confidence of the NSW Independent Casino Commission, and indeed all our regulators.

“I recognise that we won’t be judged by our words, but by our actions. You have my commitment, and that of my fellow directors and senior management team, that we will do everything in our power to make the necessary improvements,” he wrote.

The remediation effort

Heap said the business was developing a comprehensive remediation plan, referred to as their “Renewal Plan”.

“We will not only fix the issues raised in the report but will examine and address their root causes. Given the extent and breadth of the issues raised, our Renewal Plan is a multi-year plan, to fully address and embed the fundamental changes required in all aspects of our business.”

Determining the underlying issues with The Star Entertainment Group was something the head of the NSW Casino Commission, Philip Crawford, highlighted as a critical issue when the report was released last week.

Heap said several steps had already been taken to address problems in the business.

“Examples of actions we’ve taken to date include introducing stronger controls, enhancing our regulatory compliance functions and training, adding new members to our Board, rebuilding our senior leadership team, separating our risk and legal functions, hiring a new chief risk officer, and voluntarily appointing an Independent Monitor to oversee our progress.

“We acknowledge there is much more to be done and we will do it working constructively and transparently with the NSW Independent Casino Commission, our other regulators, and our Independent Monitor.”

A big business events offering

The Star Entertainment Group has significant event space and luxury accommodation within its business, including at The Star Sydney and The Star Gold Coast. The group is also a major investor in the multi-billion-dollar Queen’s Wharf development in Brisbane, which is set to begin opening in 2023, with The Star Brisbane and a major events space part of the offering. The Star Entertainment Group also manages the Gold Coast Convention and Exhibition Centre on behalf of the Queensland government.