FINANCIAL TIMES: London's winners and sinners of 2004: “And now the brickbats, where one company stands head and shoulders above the rest: Royal Dutch/Shell. Its oil reserving scandal revealed lying, duplicity, vicious infighting, smugness and incompetence at the very top of the company. Its initially complacent response - dismissing the affair as due to human failings, not structural deficiencies - revealed the depths of its cultural and governance malaise. As the year ends, the company appears to be getting to grips with the degree of change needed. But to it goes the Lombard reflecting glass trophy, the better to see itself.” (ShellNews.net) 30 Dec 04
Published: December 30 2004
Who are the UK business and finance personalities of 2004? It is time for Lombard to hand out its Winners and Sinners awards for the best and worst performances of the past 12 months. As in past years, the judging is entirely subjective, totally undemocratic - and the whim of the editor is final.
Being a column that revels in accentuating the positive, and countering the canard that we only carp and criticise, let us start with some awards for positive achievements.
The outstanding bid battle of the year - although a formal bid was never actually launched - pitted entrepreneur Philip Green against Marks and Spencer. Mr Green formally lost, in that he withdrew his putative offer in the face of a vigorous M&S defence, but he picks up one of Lombard's top awards, the Lord Hanson memorial cocktail shaker, for a well-timed assault that dramatically shook up M&S and, one hopes, will create sustained shareholder value under its new management team. If not, Mr Green may be back.
Mr Green, perhaps fittingly, finds himself garlanded with the gold chains of Lombard awards. For he picks up two more: One is the Alfred Hitchcock mystery medallion. It is still not clear to this column, despite the favour of a long, colourful explanation from Mr Green, why he abandoned his attack on M&S when he did, just when he seemed to have the company on the run, under pressure to open its books. One more push, and who knows?
Also, for the second year running Mr Green gets Lombard's Mine's- Bigger-than-Your's trophy for huge dividend payments, thanks to a £460m pay-out from Arcadia, the retail chain he bought two years ago and led to record profits. He is a clothing retailer of rare skill.
It is perhaps also fitting that Paul Myners, the man who was parachuted into the M&S chairman's seat to head its bid defence, also picks up an award: the Senior Prefect badge for ubiquity and sound judgment, since in addition to his St Michael halo he earned further plaudits for a remarkable string of well-received City inquiries, ranging from rights issues to mutual governance.
Some of the most prize-worthy performances of 2004 have come from companies that have not attracted huge headlines but quietly got on with creating shareholder value. The Golden Globe award for building a world-leading bank, while enjoying a strong share price performance, goes to HSBC, under the leadership of Sir John Bond. Tesco takes the Silver Robot statuette for inhumanly consistent good performance and Tate & Lylethe Innovations Sugar Bowl for the success of Spenda, its calorie-free sweetener.
One of Lombard's most prestigious awards, the Turnround Trophy, goes this year to Philippe Varin, who faced an extremely difficult task 18 months ago when he took over as chief executive of struggling Corus, the steelmaker. Admittedly helped by soaring steel prices, he has overseen a recovery that has made the company the second-best performer (after oil explorer Cairn Energy) in the FTSE100 index this year.
And now the brickbats, where one company stands head and shoulders above the rest: Royal Dutch/Shell. Its oil reserving scandal revealed lying, duplicity, vicious infighting, smugness and incompetence at the very top of the company. Its initially complacent response - dismissing the affair as due to human failings, not structural deficiencies - revealed the depths of its cultural and governance malaise.
As the year ends, the company appears to be getting to grips with the degree of change needed. But to it goes the Lombard reflecting glass trophy, the better to see itself.
The board that presided (before its recent personnel shake-up) over the mess that is J Sainsbury deserves a sideboard-load of wooden spoons: for awarding Sir Peter Davis, the chairman, an obscene bonus just as the company's performance was bombing; for appearing unaware of the full depths of the company's problems; and for messing up the appointment of a successor to Sir Peter, by naming a candidate the City did not want.
Sir Peter himself walks off with the Fat Cat feeding trough for the worst kind of executive greed.
Sainsbury's board must share one of its awards - Lombard's Tin Ear, for appalling communications with the City - with Jonathan Bloomer, chief executive of Prudential, who caught investors badly wrong footed when announcing a rights issue to build the company's UK business. It has left him looking insecure.
Jarvis, the troubled support services group, takes the Misplaced Optimism award for always seeing light at the end of what has been a very long, dark tunnel. However, its results statement yesterday might, as the group says, represent the nadir of its fortunes.
Finally, the award for political wimp goes to Tessa Jowell, the culture secretary, whose plans to deregulate the gaming industry were progressively emasculated as the year went on in the face of anti-gambling fever. Ms Jowell recently revealed herself as a proponent of less jargon or "bollocks" in government. So let us speak plainly: her handling of the bill was a total shambles.