With working hours across the profession consistently at the high end of the scale, it’s not uncommon to hear of finance directors taking their work home with them. But you can’t help wondering if Charles Snailham, director of finance at the London Symphony Orchestra, has taken the concept a tad too far.
When he’s not sat on the train between London and his home in the heart of Archers’ country (the neighbouring village was used as the model for Ambridge and his local pub is part of a summer coach tour), much of his free time is spent conducting his choir, Intasingers, or singing baritone in Vale Harmony, the barbershop group of which he is a member.
Snailham’s interest in music was, he believes, the deal clincher when he applied for the job four years ago, although his route to the Barbican, the LSO’s home for the last 22 years, was a rather circuitous one.
‘I just happened to be looking for a job at the right time when the LSO was looking for someone,’ he admits.
Despite a career spanning a range of industry sectors – including stints in a medical appliance company, a steel stockholder and even a double-glazing company – the shift to a world-renowned symphony orchestra hasn’t been as dramatic as you might think.
‘In some respects there are a lot of similarities with double glazing, as all the double glazing salesmen are self-employed and it’s the same here – all the orchestra are self-employed. Only the administration staff are employees of the LSO,’ he explains.
Almost 100 years ago to the day, the orchestra was founded as Britain’s first independent and self-governing orchestra – its status enshrined in a constitution that remains in place today.
But far from playing second fiddle to the musicians, CIMA-qualified Snailham and his team have got their work cut out for them this year, as the orchestra ramps up for a series of centenary fundraising activities to boost the coffers of LSO Discovery – its education and community programme.
Based at the orchestra’s new music education centre, St Luke’s, Discovery aims to make great music accessible to all, and is this year’s principle beneficiary of the Lord Mayor’s Appeal. Although Snailham hasn’t been directly involved in the funding of the Discovery project, it has had a major impact on his daily work as the cost of refurbishing St Luke’s – a dramatic 18th century church in Old Street on the outskirts of the City of London – went £4m over budget.
‘The funding was handled by a completely separate company who did all the refurbishment and rebuilding work for us. But it did have an impact on me in the latter stages. When St Luke’s set out, it was a £14m building project and it’s now £18m, so we had to fund the difference. The time and effort of our development department was taken away from the main LSO to fundraise for St Luke’s. That had a hit on our finances.’
Now St Luke’s has been up and running for around 12 months, making sure it runs effectively has had a significant impact on Snailham’s job. The St Luke’s and the Discovery programme have added yet more strings to his bow, marking a distinct shift away from orchestral management, with the two run as completely separate businesses to the orchestra, albeit heavily intertwined.
‘The company that developed St Luke’s recovered all the VAT. And because Discovery works on education projects that muddied the waters from a VAT perspective, we had to put it in a non-charity subsidiary. It’s all very boring I’m afraid. I’ve ended up knowing far more about VAT than ever before.’
Tax aside, Discovery has already proved highly successful, allowing more than 30,000 people to interact with the orchestra and learn about music through education activities, both in the concert hall and the community.
‘We try to involve as many players as we possibly can in Discovery. We may send two or three along to a hospital, community group or a school to do a masterclass, or we bring schools into St Luke’s.
‘We also have a series of concerts at the Barbican geared to the schools’ curriculum as part of our residency. It’s not whole symphonies or anything like that, it’s sections of music and it’s very interactive.’
The objective of Discovery is most definitely altruistic. ‘It’s primarily about opening people’s eyes to classical music. We feel that it’s a bit overlooked in schools these days, because the amount of money they have to spend on music isn’t as much as it used to be. I think the impression a lot of youngsters have about classical music is that it’s very dry, and not something of interest to them.’
‘Essentially it’s about the long-term future for classical music. If children have experienced it as youngsters, they’re more likely to come back to it in their teens or maybe later on in life. It’s about building future audiences.’
Despite significant funding from a number of sources including the Arts Council, English Heritage and commercial sponsors including UBS, a shortfall has meant plans have had to change. ‘We’ve had to revise our expectations of St Luke’s. It was originally and still is our education centre. But because the funding for the building hasn’t quite come together as we anticipated, we’ve had to emphasise the commercial side a little bit more.’
The St Luke’s facility has already been used by Radio 3, Songs of Praise has been recorded there and you can even hire out the centre for your wedding reception. It is a commercial decision that appears to be paying off. A year after St Luke’s opened, it’s now at break-even point. ‘It’s a shame we can’t use it more for education – but at the end of the day we have to pay the bills,’ Snailham laments.
Waving another baton, conducting the orchestra’s finances, Snailham’s role is pivotal to ensuring the orchestra attracts the creme de la creme of musical talent – and has a compelling proposition to retain them. Finance has a huge role to play in that respect.
‘It’s all about getting the orchestra to work together as a team, making sure they’re all comfortable in the jobs they’re doing, and providing them with the level of support to enable them to do the job of producing quality music, which is what the LSO is all about. There are a lot more people issues than there would be in any other industry I suspect.’
Once accepted into the LSO (Snailham describes it as a long and tortuous process involving multiple auditions, lengthy trials with the orchestra and peer group evaluations), members become shareholders in the orchestra.
It is a process that is key to ensuring the highest quality of players, but once you are in, the orchestra provides a raft of benefits, which is where Snailham and his team come in.
‘When I first joined, most of the instruments were owned by the players. We bought percussion, but in the past couple of years we’ve invested in more instruments. We got an Arts Council Lottery Grant and one of the conditions was we had to match the amount. We’ve spent just short of £1m.’
This is a benefit in kind to ‘shareholders’ in the orchestra that Snailham believes gives the LSO a real edge over the competition.
‘It’s not just a case of recruiting the best players. It’s also about providing them with the best instruments to enable them to produce a good-quality performance,’ he says.
As part of the package, an endowment trust set up by LSO offers players struggling to buy their own instruments loans with ‘reasonable’ rates of interest. Donations from trustees, including Roberto Mendoza and Rocco Forte, are invested in the money markets through an investment company.
It is Snailham’s job to sit down with them every six months to check everything is on track.
Orchestra members are also offered insurance for their musical instruments.
Bearing in mind some of the instruments are worth hundreds of thousands of pounds, it is a hefty bill. And although you may not rank orchestral playing on your list of hazardous activities, the LSO provides medical insurance to players because injuries do occur.
‘Some of them are quite serious because players can get repetitive strain injury. We have three levels of cover – private medical insurance to cover any doctor’s treatments or operations, a musician’s benevolent fund and we also can provide long-term invalidity benefit,’ he says.
Fortunately for most players, the only drama they are likely to experience is taking part in the recording of a film soundtrack. The orchestra was behind the music in all the Star Wars films, the Indiana Jones trilogy and the second Harry Potter film, to name but a few.
‘We’re quite a busy orchestra. Between the 80 or 90 concerts we do at the Barbican, and the 30 to 40 concerts we do abroad each year, plus all the Discovery work and other UK concerts and recording sessions, the diary gets quite full. When they recorded the first Harry Potter film, they wanted more flexibility than we could provide in the diary so they went to someone else.’
Film royalties generate around £20,000 a year of the orchestra’s £10m annual turnover. ‘It’s a small but regular income. Every quarter I get printout an inch thick with details of all the royalties we’ve earned.’
In some respects, little has changed of the financial instability of London’s orchestral life in the past 100 years. ‘The Arts Council and the Corporation of London, who are our major funders, front-load a lot of the grant, so most of it gets paid early on in the year. We don’t have any reserves and we aim to break even every year, so it’s a big juggle trying to make sure the cash flows and we’ve got enough money to meet our commitments.’
Snailham, meanwhile, continues to do his dream job. As with his previous careers, it’s the trips to the shop floor that really inspire him. ‘I’ve always enjoyed seeing how things were actually made, but it’s even more of a thrill to hear the orchestra in rehearsal.’
Needless to say, his motivation isn’t always totally selfless.
‘I’m absolutely thrilled to be able to hear them perform. It’s widened my musical vocabulary and, actually, I’m always picking up tips on conductor techniques.’
When the London Symphony Orchestra was created 100 years ago, it became the first independent and self-governing orchestra in Britain, a status that remains intact today.
All the players are shareholders, and the orchestra’s board is composed of 12 directors, of which nine are players and two are outside directors.
But as corporate governance moves up the business agenda, and the LSO experiences a greater need to be a commercially viable activity, it is being pushed down a controversial route by the Arts Council, one of its primary sponsors and the national development agency for the arts in England responsible for distributing public money from government and the National Lottery.
‘Of the two outside directors, one of them has been instrumental in getting our sponsorship deals together, the other is a key figure in the City financial world, Snailham explains.
‘I think the Arts Council feels that we ought to have more outside directors not associated with the music industry to provide a commercial input.
‘At the moment, we’re not sure whether that is appropriate. It’s not only pushing us – but it’s pushing a number of other orchestras to go along the same road.’
Whether the board will change its makeup is still being determined, although Snailham has been told that the Arts Council is close to a decision.
Snailham is not averse to a stronger commercial focus on the board. He adds: ‘The one thing I am unhappy about is that I’m not on the board. Although I’m company secretary, my title is not finance director but director of finance, and it’s not a directorship as such.
‘That’s not to say I don’t have a presence on the board. We do aim to have quarterly business meetings where we review the accounts, but that’s about the limit of it.’
Does Darwin's theory apply to taxation? Colin ponders...
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states
Accountancy watchdog the FRC has dropped its investigation into the former chief financial officer of Tesco, nearly two years after the supermarket was engulfed in an accounting scandal
Colin imagines how Apple's logo might change in the wake of the EC's ruling over its Irish tax arrangements