Vodafone was in trouble at its annual meeting on Tuesday last week when, in a highly unusual public display of discontent, several institutional shareholders voted against the reappointment of Arun Sarin as chief executive
They are disgruntled because in the words of one critic ‘the company does not
know what it is or where it is going’.
BP is also in trouble. This time the issue is not the quality of the chief
executive Lord Browne, but many are concerned about the date of his retirement
and the choice of his successor. There was a feeling that he might want to stay
on and have undue influence over the up-coming appointment .
There are echoes here of Vodafone. Sarin was seen as the choice of previous
chief executive Sir Christopher Gent, and the transition, whether or not it has
been Sarin’s fault, has not been a happy one.
Tesco is in trouble. Its financial results are stunning but its continued
expansion, mastery of the planning laws and dominance over suppliers, have made
the public uneasy.
There is beginning to be a pattern here. Why are our largest companies so bad
at public relations?
Why has Vodafone not been able to communicate its vision of the future and
why are people questioning Tesco’s power, despite it accounting for one in every
eight pounds spent in shops?
The big companies that do well are those where the chief executive fronts the
PR effort and makes an effort to relate to decision formers at a personal level.
The strugglers are those where the leader is remote, or ‘too busy’ or delegates
it.
Sir David Varney put it well once. ‘The most important thing an industrial
leader has to do these days is communicate’ he once told me. ‘Trouble is’ he
added, ‘it is the one thing none of us has any real training for’.
Anthony Hilton is finance editor of the Evening Standard