Aug 8 (Reuters) - Australia's Qantas said it

was cutting its former CEO's exit bonuses by A$9.3 million ($6

million) after an external review found him responsible for

measures alienating travellers, employees and shareholders in

the COVID era and beyond.

The decision marks a gloomy footnote to the 15-year rein of

Alan Joyce at Australia's dominant airline, who brought forward

his retirement to last September under a cloud of lawsuits

alleging unfair pandemic sackings and selling tickets to

cancelled flights.

Qantas was one of Australia's top brands for years even as

Joyce leaned into controversy. In 2011, he grounded its entire

fleet over a union dispute, but the sacking of 1,700 groundstaff

in 2020 while collecting COVID stimulus payments, followed by a

surge of flight cancellations and lost luggage once COVID border

restrictions lifted, prompted analysts to warn the cost of

repairing the airline's reputation may hurt profit.

Joyce's final compensation totalled A$21.4 million including

bonuses, but the company said at the time it reserved the right

to withhold some pending an external review of how the airline

which sells nearly two-thirds of Australian domestic fares was

run.

Qantas published the review on Thursday, which blamed the

company's reputational crisis on a "command and control"

leadership style, and said it was cutting Joyce's final package

to just over half the original amount.

"There was too much deference to a long-tenured CEO who had

endured and overcome multiple past operational and financial

crises," said the report by McKinsey & Co senior adviser Tom

Saar.

"(Qantas) had a 'command and control' leadership style with

centralised decisions and an experienced and dominant CEO," the

report added.

"This contributed to a top-down culture, which impacted

empowerment and a willingness to challenge ... decisions of

concern. That cultural characteristic underpinned some of the

events that affected the group's reputation."

The Qantas board had "limited visibility or appreciation of

the manifestation of this cultural characteristic", the report

noted, adding that the company had already replaced some

directors and top managers.

The company was also re-setting its relationships with

external stakeholders, the report said, in light of an

"adversarial approach to engagement" under Joyce.

And the airline had brought in a stricter internal approval

process for CEO share sales, the report said, noting Joyce's

sale of A$17 million of Qantas shares in June 2023, a few months

before his scheduled retirement, contributed to a loss of trust

among stakeholders.

Qantas agreed in May to pay A$120 million to settle a

regulator lawsuit over the sale of thousands of tickets on

already cancelled flights.

The airline, which reports full-year results on Aug. 29, is

still waiting to learn how much it must pay after losing a

separate lawsuit which found it illegally fired 1,700 ground

staff in 2020 to stop them from taking industrial action like

strikes.

($1 = 1.5349 Australian dollars)