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Brown shows bosses the way

London Evening Standard: Brown shows bosses the way

Alex Brummer, Daily Mail

14 May 2004

E used to think of the public sector as sluggish and cautious and private corporations as fleet of foot. But as far as senior jobs are concerned there is a role reversal.

Gordon Brown has snatched David Varney, one of the country’s more impressive industrialists, from under the noses of Marks & Spencer, Shell and several other companies that might well have seen him as a future chairman.

The speed with which Varney has been through the rigorous approval process for public appointments is impressive. Brown only unveiled his plans to merge Customs & Excise and the Inland Revenue in his March Budget and a couple of months later the new man is parachuted into the job, without any of those mysterious leaks that accompany company board appointments.

This is becoming something of a habit. Michael Grade left a raft of private sector jobs to become the lowly-paid chairman of the BBC, after an equally speedy process.

So what is happening here? Company boards have become increasingly cautious in their appointments.

Instead of reaching out straightaway to the obvious candidates, and even openly advertising for key jobs, they insist on employing armies of headhunters and corporate governance experts before making their decision.

Even then they are still often grotesquely wrong, as when they appointed Sir Ian Prosser in preference to Sir Christopher Gent at J Sainsbury and had to abandon Prosser in the face of a shareholder revolt.

The independent directors who make up the nominations committees are behaving like frightened rabbits.

They are doing the corporations concerned no good. Shell would benefit from a powerful chairman and one like Varney, with experience at Shell and in the broader energy industry, would have been ideal. Instead they are prevaricating.

It is essential that Marks & Spencer, where the turmoil continues, finds a new boss urgently rather than let the sand slip through the hourglass.

As we have noted here, there are good retailers able and ready to go, as well as City grandees in search of a new role.

Varney will take a wage cut to head Her Majesty’s Revenue and Customs, but will no doubt be rewarded with a seat in the Lords. Before that he has a massive job to blend two different cultures at the Customs and Revenue and make some complex systems – which defeated his predecessors – work.

If anyone can cut through the morass, start slashing red tape for business and improve collections, it should be the mmO2 boss. Brown has chosen sensibly.

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