Sir John Parker: 'A man you want on your side, and not one to cross'
Face to Face: The Superman of British boardrooms and favourite of headhunters says warnings of an imminent winter fuel crisis are just a scare
Sunday 17 January 2010
Sir John Parker is Britain's very own Clark Kent. Most days he's the mild-mannered chairman who runs some of our most important strategic corporations. But whenever a really big crisis hits, he steps out of the phone booth and swings into action, his cape swirling around him.
Britain running out of gas? Banks about to collapse? Barbarians at the gates of a giant mining company? No problem. Superman is there, bang in the middle of the crises, leading the troops and masterminding solutions.
Right now, Sir John is applying his superpowers to Britain's energy supplies as chairman of National Grid, the network piping gas and electricity around the country, which has issued four emergency alerts over the past few weeks as demand has peaked at unprecedented levels.
So does the big freeze mean we are about to run out of energy? As you might expect of a real Superman, Sir John is quick to reassure, his voice calm yet firm: "I can stand back and say we are not in a crisis. There's no need for anyone to worry. Demand is up at extremely high levels because of the weather, but we are not going to run out of gas. We have the necessary supplies."
But why the alerts? "We are obliged to tell our customers which have interruptible supplies [including some factories and NHS trusts] that there are potential shortages. Also, it's a means of telling our suppliers that we need more gas, so they are part of a balancing act to ensure we have enough supplies. There have been hiccups in supply coming from Norway because of freezing undersea pipes," he says, and he should know, as he has a hotline to the Grid's control room at Warwick, where staff monitor second by second the UK's power supplies.
The severe cold has pushed demand for energy up by 4 per cent over the past few weeks. While this doesn't sound much, Sir John explains this meant the UK consumed some 463.9 million cubic metres of gas on the worst day, beating the previous demand record by 10 million cubic metres.
What about warnings from politicians that we don't have enough storage space, and that only seven days separate us from a Day After Tomorrow-type disaster? Again, Sir John dismisses the scares, saying that the storage built up by the Grid over the past few years has created more than enough capacity: "It's simplistic, extreme and untrue to say we have only a few days' supply; whoever has been saying this doesn't know what they are talking about." For a complete disaster, he says, it would mean all supplies from the Zeebrugge pipes, BG, Exxon and the Grid would shut down – an implausible situation. For now, half of the UK's gas still comes from indigenous sources, the North Sea and Morecambe Bay, while the other half is imported, mainly from Norway. Huge investment by the Grid over the past few years – the £1bn pipeline to take Norwegian gas through the whole of South Wales and up into Gloucestershire to connect with the main arteries – means that there is regular gas coming into the country.
The even bigger fear that the UK's lights will go out in 2012 because of dwindling energy sources is even more nonsense. Even Superman's patience wears thin: "There's a lot of hysteria about the lights going out There is also a lot of misinformation being put about. With the investment programme we have put in place, plus all the new developments taking place with new nuclear plants and the new planning authority, there shouldn't be a crisis." But Sir John does have a caveat: "We have have a few critical years in which to make sure all these things do come together; otherwise there could be problems."
We meet on a wintry grey afternoon at the Carlton Terrace headquarters of Anglo-American, one of the world's biggest mining companies, in one of the tiny meeting rooms which has windows more like portholes and from which you can spy the London Eye. He spreads his week between Anglo, which he joined last summer as chairman to help to see off the unwanted advances of rival Xstrata, and the Grid's offices near Trafalgar Square.
Since being parachuted into Anglo's boardroom, he hasn't stopped, bringing in new faces to the board, including Sir Philip Hampton from the Royal Bank of Scotland, which caused a few raised eyebrows, and more mining experts. Visiting South Africa was a priority and he's been to meet "the people at the front end" at the platinum mines, spending time with the engineers and those who make the company really tick, making sure he understands all the critical issues such as health and safety as well as new mining techniques.
He's also been out talking to investors who were rattled by Xstrata's cheeky, nil-premium, £10bn takeover bid for Anglo. Sir John's appearance on the scene has seen Xstrata's Mick Davis skulk away, for now. But, as Sir John admits, Anglo must show it can provide shareholders with value and come up with the promised £1bn of savings.
Most pertinently, though, he's also given his backing to Cynthia Carroll, the chief executive, who came in for a rough, if not misogynist, ride from investors and former employees. "Some of the comments about Cynthia have been, well, how can I put this politely, disgusting, despicable and painful." Ever the gentleman, he's backing Carroll in her drive to deliver change as well as savings and the sale of certain assets."She's had a lot of stick – from inside and outside – partly because she wanted to make changes which upset a lot of people who have been used to doing things in a certain way."
No one doubts that Xstrata will be back if it spots any weakness in Anglo's game. By the same token, Sir John has never shied from doing deals, the right ones, and he's always been up for a fight during an extraordinary 40-year career as one of Britain's top industrialists, sitting on the boards of 12 quoted companies, chairing eight of them. As he puts it: "It's about getting the right value out of a company."
As the former chairman of the Bank of England's court, Sir John was at the heart of the historic rescue operation in the autumn of 2008 which bailed out Royal Bank of Scotland and Lloyds Banking Group and pumped new money into the financial system. He can't reveal too much of what went on during those dramatic months but let's slip: "I'm to the right of Genghis Khan, but even I would have nationalised the troubled banks." At the Bank, he oversaw significant reforms to the court, including cutting it down in size. He has the biggest admiration for the Governor, Mervyn King. "A great intellect; we are lucky to have him in charge."
By far the toughest of all the crises this Superman has dealt with was at Harland and Wolff, the Northern Irish shipbuilding yard. He was sent in by Lady Thatcher in 1983 to take it private; he stayed for a decade. "That was the most difficult thing I have ever done; dealing with the unions; terrorists out on the street."
But it was also enormous fun as Harland was his first job, where he first trained in the ship design team after studying naval architecture at Belfast's College of Technology and mechanical engineering at Queens University.
As he talks about his life, which began on a small farm in County Down, it's not hard to see where his grit comes from, or why he's still the UK's most sought-after company chairman and director. As one headhunter put it: "There isn't a board in the country which doesn't want him as its chairman." While there's grit, there's also a gentleness of manner (that Clark Kent again) which is given all the more softness by his sing-song, Northern Irish brogue, but there's no doubting the killer instinct; he's ruthlessly precise and to the point. One merchant banker who came up against him in a bid situation says: "John is unfailingly courteous but with a mind like a steel trap. He's a man you want on your side, and not one to cross."
What does Sir John think makes him so special? He breaks into laughter for the first time in our chat: a serious, proper chuckle. "You know I never talk about the personal," he says, but goes on: "Being a good chairman comes down to leadership but most of all to having really good people around you to whom you can delegate. You've got to be tough about getting the right ones and, at times, brutal about pruning those who are not up to it. Good management does make a difference. But never get so high up that you can't find time to go down."
You wouldn't believe Sir John will be 68 this April, as he's as energetic and driven as a man half his age; most days he's at the office between 7am and 8am, keeps religiously to carefully timed meetings through the day, capped off nearly always by a dinner. Any free time is spent on his beloved Shimna, a 46ft Malo sailing boat kept in Plymouth near where he lives with his wife, Emma.
So what drives him, I ask, and why doesn't he just go off and sail around the world? That's what most people do in his position. He laughs again. "I still love every minute of my work and feel privileged to be working for two such great companies. It's also good to feel that I can put my experience to good use. The day I don't think I'm adding any more value, that's the day I leave." It's my time to go – my very precise 45-minute slot is up – but I am left pondering what on earth could be the next crisis for which Sir John will be tearing off his shirt.
The busy life of an industrial fixer
Born: 8 April 1942
Studied naval architecture and mechanical engineering at the College of Technology and Queens University, Belfast and joined the ship design team at Harland and Wolff in 1964.
DSc (Eng), ScD (Hon), DSc (Hon), D.Univ (Hon), Hon Fellow Imarest, Frina
*Chairman of National Grid
*Chairman of Anglo-American
*Vice-chairman of DP World (Dubai)
*Member of the Prime Minister's Business Council for Britain
*Non-executive director of Carnival Corporation
*Non-executive director of EADS Airbus
*Chancellor of the University of Southampton
Stepped down as chairman of the Court of the Bank of England in July; as joint chairman of Mondi plc and from the chair of the BVT joint venture in June 2008.
Appointed managing director of Austin & Pickersgill (Shipbuilders) Sunderland.
Following nationalisation of the shipbuilding industry, appointed to the board of the British Shipbuilders Corporation, later becoming deputy chief executive.
Returned to Harland and Wolff as chairman and chief executive to lead a turnaround and transfer from public to private sector.
Joined Babcock International Plc as chief executive.
Became Babcock chairman and chief executive during a period of significant group turnaround and transformation.
Non-executive director of British Gas
Chairman of the Lattice Group on its demerger from BG Group.
Chairman of the combined National Grid Transco after it is formed by the merger of Lattice with National Grid.
Non executive directorships
Industrial Development Board of Northern Ireland
British Coal Corporation GKN; BG Plc and Brambles Industries, chairman of Firth Rixson and non-executive director and subsequently deputy chairman of P&O Princess Cruises.
Chairman of RMC Group, leading its sale to Cemex of Mexico in 2005.
Appointed chairman of P&O, leading its sale to DP World (Dubai) in early 2006.
*Fellow of the Royal Academy of Engineering, a younger brother of Trinity House and a visiting fellow of University of Oxford.
*President of the Royal Institution of Naval Architects and prime warden of the Worshipful Company of Shipwrights and an honorary freeman of the Worshipful Company of Fuellers.
*Governor of the Royal National Lifeboat Institution, a member of the General Committee of Lloyds Register of Shipping and vice-president of the Royal Navy and Marines Charity.
*Leader of the Young Offenders into Work programme and a member of the International Advisory Board of Citi Group and served on the Defence Academy Advisory Board.
*Member of the Government's Asia Task Force and was deputy chairman of the White Ensign Association.
*Knighted in 2001 for services to the defence and shipbuilding industries. Apart from sailing, he likes reading and music.
Married to Emma, a former Latin teacher and pianist; two children: Graham, an artist and writer, and Fiona, an environmental scientist; two grandchildren.
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