(Bloomberg) -- Star Entertainment Group Ltd.’s future hangs in the balance after an inquiry found the company had suffered from dysfunctional leadership, questionable ethics and culture, and remains unfit to operate its Sydney casino.
The gaming regulator, which received the report by lawyer Adam Bell a month ago, said Friday it’s still assessing the conclusions of the three-volume publication.
Bell’s report shows a company that has failed to adequately address long-standing governance and cultural concerns, Philip Crawford, chief commissioner of the New South Wales Independent Casino Commission, said in a statement.
Crawford’s decision to hold off on a final determination on Star leaves the company’s fate largely in the hands of new Chief Executive Officer Steve McCann. He’s been in the role less than two months, but Crawford said transparency and cooperation at Star had already improved. McCann now has limited time, likely a matter of weeks, to prove he can lead the company back to acceptability in the regulator’s eyes.
Star’s shares were halted in Sydney as the company assesses Bell’s report. The stock has slumped more than 50% in the past year, slashing the company’s value to A$1.3 billion ($883 million).
The first two volumes of Bell’s final report that were released Friday — a 500-page blend of dense legalese and candid critique — contain telling findings.
According to the report, an ethics assessment commissioned by the Star concluded in June last year that a set of “shadow values” inside the company were subverting the integrity of staff. These values included ‘profit matters most’ and ‘play politics to stay alive and thrive,’ Bell said in his report.
Bell said the evidence at the inquiry confirms the assessment of the Star’s directors — that the company is “presently unsuitable to be concerned in or associated with the management and operation of The Star Casino.”
McCann was appointed after a period of boardroom upheaval at Star during Bell’s inquiry that saw several executives including former CEO Robbie Cooke and Chairman David Foster leave.
Star’s Sydney casino has been run by a government-appointed manager since a damning report in 2022 found it had lax anti-money laundering controls, allowed patrons to flout China’s capital controls and encouraged problem gamblers.
The manager’s term is currently due to expire March 31, 2025.
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