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Joining the £1m club
Hanif Lalani has joined the FD's £1m club. BT Group's annual report, out today (Wednesday), reveals that the finance chief at the telephone giant is now on a total package of £1.068m, his first time through the million pound barrier. He's buying the beers then.
It's a leap, by the way, of more than than a quarter of a million, which is a decent pay rise by anyone's reckoning.
Last year an investor told Accountancy Age that Lalani was a good communicator, understood the politics and was in the process of building his reputation.
There shouldn't be objections then to the extra wodge he's pocketed which, incidentally, seems to be the biggest pay rise among BT board members.
Let's take a punt on the future. Lalani to become BT CEO. Now we've no reason to believe the job is up for grabs, but given the belief there seems to be in the Ugandan born CFO, what odds would you give on him getting the top job if it became available?
I know what you're thinking - wild and baseless speculation! I agree, but why not. And if Lalani doesn't at some point reach the pinnacle at BT, who's to say he won't do it somewhere else in the future?
Well for a start he's a bit of a company man - he's been at BT since 1983. He's committed, he clearly loves the business. A man who sticks around that long and keeps progressing can't help but feel that he might just go all the way.
You heard here it first.
Logica conclusion
Seamus Keating, finance director at Logica, the IT consultants, must be pondering his future this morning. While for most rain was the only spoiler for the Bank Holiday weekend, Keating learned that his CEO Martin Read was stepping down following sustained pressure from investors.
Not only that, but as he goes to work this morning he will no doubt read the press reports suggesting that he is no longer a favoured candidate to succeed Read, and that an external candidate will be sought.
You couldn't blame Keating for thinking that his time at Logica is up and that it was time to clear his desk. Not only does he seem to have lost confidence as a successor, but investors seem to have generally taken against the board as a whole.
Interesting now to see whether he fights his corner, or cuts his losses. Either way, not a nice way to return from the Bank Holiday.
Network Rail: backtracking on bonuses
There must be some relief this morning that common sense has prevailed and the four Network Rail directors set to share £300,000 in bonuses have at last decided to defer them until after the investigation into the Cumbria rail accident has been concluded.
I say at last because the bonuses of more that 100 staff directly and indirectly linked to the incident had already been frozen. The directors, among them FD Ron Hendersen, had thought otherwise about their own annual payouts, however.
To freeze some, but not their own bonuses was always a thoroughly naive move by the Network Rail chiefs. In one single stroke of genius they managed to alienate their staff and the unions, as well as provide more ammunition to those who like to sling mud at 'fat cat pay'.
You've really got to wonder whether they sat back and considered even for a moment the rather subtle, but oh so significant question of, 'How is this going to look?'
Fair play for putting things right, but only after putting a bullet through their collective corporate feet. Best to spend a little money in future on PR training, I think.
Big Four enemies: numbers two to four
Public enemy number one for the Big Four, at least here in the UK, was Paul Boyle, chief executive of the Financial Reporting Council and the driving force behind the audit choice review. This is the review tasked with finding ways of improving the market, or rather making the Big Four a Big Five again.
But now there’s a new nemesis, or three. Start with Henry Paulson, US Treasury secretary who has announced Washington’s own review of the audit market. Then there’s Arthur Levitt, the hard boiled former chairman of the Securities and Exchange Commission, (who once said that accountancy firms could not be trusted to regulate themselves), and will co-chair the review. And then there’s Donald Nicolaisen, former SEC chief accountant described as ‘a powerful agent for change’ while in a former job.
To be fair, Nicolaisen is a former PwC partner , so he’s likely to be considered as a Big Four ally. But having said that the very fact the Paulson has appointed Levitt will have the US Big Four people worried. Almost makes you feel sorry for them.
Mixing it at Accenture
You’ve got to hand it to David Thomlinson, UK managing director of Accenture. Interviewed in Accountancy Age last week, not only did he talk up the firm’s prospects after a bit poor trading (‘Yeah, I’m very confident on our current trajectory that we are back into a growth position’), but he laid into the Big Four consultancies too.
He said Accenture had ‘much greater breadth and depth. It’s not just based around providing advice and reports.’ Accountancy Age ran the story on the front page under the headline, ‘Consultants dismiss Big Four challenge.’
That must have stung the Big Four consultancy guys. In fact I know it did. I bumped into one at the weekend who said: ‘Nice story on the front page – Accenture says we’re rubbish. Cheek!’ then he stalked off. Guess Thomlinson got the reaction he wanted.
Surviving EMI
What will happen to Martin Stewart, chief financial officer, at music group EMI. The group, which represents acts like the Rolling Stones, Joss Stone and Lily Allen, looks on the brink of being bought by private equity vehicle Terra Firma, with Warner Music lurking in the background threatening to launch a spoiler bid.
But what of Stewart? Reports say current EMI boss Eric Nicoli is unlikely to stay post takeover, but will the rest of his executive team, including Stewart, weather the storm?
He’s an experienced man, having worked at BSkyB as CFO and at Polygram, but has he been around long enough to have been tainted by the Nicoli era?
Well he started in February 2005, in many respects he’s something of a new boy, so he might be in the clear. He might well be attached to his £525,000 salary as well. But the sale is still unravelling, so worth watching to see what happens and whether Stewart will be handling the finances for the next crop of new bands.
© Incisive Media Ltd. 2008
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