A harsh twist of fate dictated that Cairn Energy dropped out of the FTSE 100
on the same day that Accountancy Age met its finance director Jann
Brown. Rumours had been circulating that Cairn would be relegated for a number
of weeks, so a rescheduling until the heat had died down might have offered a
welcome reprieve from the feverish attentions of the cynics and the
But for a woman who has carved out a position in the top rung of UK finance
bosses without sacrificing her family life, Brown is more than accustomed to
taking the rough with the smooth. Brown stresses that there is no stigma
attached to Cairn losing its FTSE 100 berth as the prestige factor had never
been the ultimate driver for oil explorer.
‘Look, we would have left it in June anyway, at the outset of the Indian
float to give cash back to shareholders. That’s very much part of our philosophy
– we’re giving £3 per share this month. There was minimum fuss when we went into
the FTSE 100, the fundamentals of the business are unchanged and the value of
the business is unchanged so there haven’t been any tears shed at coming out of
it. We’re about value not price,’ she stresses.
Brown endured something of a baptism of fire in stepping up to the FD throne
at Cairn after seven years as its financial controller. Her first task was to
shepherd Cairn India through the final stages of its initial public offering
after the oil explorer’s flourishing Indian arm was spun out of the parent
‘We set ourselves an incredibly aggressive timetable and we got there earlier
than we expected but I don’t think any of us realised quite how intense that
process would be. It was a huge amount of work. It was incredibly labour
intensive and my husband was fabulously supportive at home. This year I actually
have a bit of a life!’
Maintaining the delicate work-life balance has been a constant feature of
Brown’s career despite taking an unconventional route into the accounting
‘If anybody had told me when I was studying history that that I’d be an
accountant and I’d really enjoy it, I would never have believed them,’ she says.
After completing her degree at Edinburgh university she decided to have a
family before launching her career, a major hurdle, then and now, for those
women trying to negotiate the perilous waters of the corporate shark tank.
Route to the top
After a few years as a full-time mother, Brown found, initially at least,
that her route to the top was far from easy. Determined not to spend the rest of
her life doing ‘part-time, lower grade work’, she embarked upon her chartered
Back in the late 1980s, there were nine big firms, she recalls, but KPMG was
the only one to decide that it could take a woman in her mid 30s with a couple
of young kids: ‘Nobody else would look at me.’
She joined the firm’s audit division but it quickly became clear to Brown
that if she wanted to progress, a lot of travel would be involved. ‘It wasn’t
going to be ideal for me, so I moved into tax, which was much more office-based.
That was one of the best moves I ever made. It exposed me almost immediately to
deals and transactions work and to me that’s still the most exciting part of
It was when she was at Deloitte a few years later that she was recommended
for a role at the oil company. ‘Cairn was expanding and looking for a group tax
manager. I joined up within a matter of weeks of my predecessor Kevin Hart also
Hart encouraged her to move out of the pure tax role and become his financial
controller. She had no reservations about taking on overall responsibility when
Hart announced his intention to step down.
‘When I found out, I said that I wanted the job but if you want to put it out
for tender I’ll be there as well,’ she recalls.
‘Our chief exec Bill Gammell is very much about giving people responsibility
until they almost say “I can’t take any more”. There wasn’t any aspect of the FD
role that Kevin hadn’t tried me out on.’
‘Accounting is an incredibly varied, creative, exciting job and I’m lucky to
be working in a company that’s so fast-paced,’ Brown says.
She admits to having a low boredom threshold, but fortunately the frenetic
pace of the energy industry and the fact that she’s constantly working on new
projects keeps things interesting.
One of Brown’s signature traits is her ability to segue from one thorny topic
to another in typically forthright style.
She certainly doesn’t pull her punches when it comes to the IFRS minefield:
‘I recently chaired a session at a finance directors’ strategy conference about
IFRS and I don’t think there was anybody there who thought it was a good thing
in the way that it’s gone.’
But she accepts the accounting rules are here to stay despite it resulting in
huge amounts of profit and loss volatility on Cairn’s balance sheet.
Brown also admits Cairn did not get the support it was looking for from its
auditors E&Y during the IFRS transition. ‘I have yet to speak to a company
who felt that they were fully supported by the auditors.
‘Since then I think they’ve really taken on board that they have to provide a
same standard service in all the countries that we operate in. That’s a
challenge for them and they really pull out all the stops to make sure that
they’re doing that. We operate an absolute “no-surprise” culture here.’
As an avid supporter of principles, Brown raised some serious doubts about
the regulatory landscape of the future.
‘I have a grave concern that we will sacrifice them to get the convergence
with the US, because the US isn’t going to move. With the IPO, we had to restate
our IFRS-based accounts in Indian GAAP — 140 sets of them going back five years
for all the companies going into the Indian float and that’s a situation that’s
screaming out for convergence.
‘I absolutely agree with getting a truly international global capital markets
system going without barriers but I have real concerns about rules-based
accounting. Unless we can persuade the US that there is merit in principles,
then all the detail will get lost.’
Brown says there’s nothing she would have changed about her baptism of fire
at Cairn. ‘Maybe I wouldn’t have gone through it quite so intensely,’ she
reflects. ‘We’re always looking for the next strategic opportunity that we can
get our teeth into.’
Although change often reflects opportunity she points to a lack of role
models and adequate childcare provisions as being the main hurdles rather than
any perceived glass-ceiling for women.
‘The women that thrive tend to be strong characters. Ginger Rogers said that
she did everything that Fred Astaire did – but had to do it backwards and in
high heels – and that’s what we do.’
Oiling the wheels
Cairn surprised industry watchers recently as it announced that it would
stump up 70% of the cash needed to build a pipeline from its Rajasthan
development to refineries on the coast. To compound the issue, the conduit is
expected to cost between $700m (£354m) and $800m – double previous estimates.
‘Our legal approach is absolutely clear – we’re not obliged to build a
pipeline to export the oil, but in the interests of keeping the schedule of
bringing first oil and getting additional benefits from participating in the
pipeline we were willing to negotiate with the ONGC (India’s state-owned Oil and
Natural Gas Corporation). For every dollar we spend, we take the dollars out of
the oil revenues until we reach payback from the pipeline costs and only then
will the government share in the revenue. For the Indian government this is
absolutely critical as they’re still a net importer of oil with all the
associated costs. They want to get this happening as much as we do, Brown says
Cairn India could hold its own until the Rajasthan oil field starts to bear
Echoing some oil analysts’ sentiments she believes the relevance of P&L
as an indicator of fiancial health is waning. ‘It’s about having a strong
flexible balance sheet and not having too much gearing. In completing the IPO we
raised some equity for Cairn India plus we’ve got an $850m facility for them
which should give them more than enough funding to complete what is necessary
until they start producing, at which point the adult project becomes
‘It’s all about making sure the cashflow is there to getthrough to that first
oil at which point the revenue literally starts flowing, the bankers are paid
off and we can look for new placesto invest it. The driver in floating off the
Indian business was to allow the potential there to be re-geared for future
We’re looking at other places in the world where we want to invest. There are
lots of opportunities for oil and gas but the competition for assets is tough,
so if I told you where we were thinking of investing, I’d have to kill you!’
Find out more about Cairn’s maverick founder Bill Gammell at
Visit the oil explorer’s website at
Read about the impact of IFRS on the oil industry at
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