You couldn't call Sir Richard Branson coy, so why all the secrecy at Virgin?

Mark of misery
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The Independent Online

There's a lovely moment in the film Four Weddings and a Funeral when one of the chinless wonders is asked how he rates among the richest men in Britain. In his imprecise answer, he comments: "That Richard Branson is doing awfully well."

That may be the case. He certainly has fingers in many pies – airlines, rail, retailing, mobile phones, financial services. And he appears to be the appointed saviour of the world, stepping in to solve Sabena's woes and providing the new head honcho for the rail network.

Yet for such a public-spirited – and dare I say publicity-hungry – chap, he remains surprisingly reticent about telling people what is going on in his business. Of course the Virgin empire is almost entirely privately owned. But even taking that into account, Virgin is secretive.

The group is controlled via offshore trusts and has a labyrinthine structure of companies operating in little groups without a central holding company. Sir Richard's central core provides finance and management services to the subsidiaries, many of which are joint ventures with outside shareholders – Singa- pore Airlines for Virgin Atlantic, Stagecoach for Virgin Rail, AMP for Virgin Direct etc etc. Sir Richard has taken to equating the structure with a venture capital firm, which is a novel approach.

If you want to get an up-to-date picture of how these parts are doing, you might as well forget it. The Virgin Atlantic side is good on its reporting and we will soon learn how 11 September harmed it, and Virgin Rail has no choice given its regulatory structure. But many other businesses file their accounts late or as late as they can get away with.

Take Virgin Direct. The financial services business filed its accounts on 31 October, the last day it could. When you read them, two things stand out. One is that the business loses money. The other is that is auditor, Ernst & Young, signed them off on 24 May. The accounts could have been filed five months earlier. Why the delay?

The same thing happened at Virgin Mobile, the joint venture with One2One. It filed its accounts, showing a £106m loss, on 31 October. But auditor Andersen signed them off on 9 May, and Virgin Direct sat on the figures for nearly six months.

The nearest thing to a central company in Sir Richard's group is Virgin Management. Its most recent accounts are for the year that ended on 31 January 1999 – so they are two and a half years out of date. I asked Peter Gram, the company secretary for that and some 240 other Branson businesses, why and he said he had nagged the directors to update the accounts, "But what can you do?"

I don't want to get at Sir Richard; this country has few enough genuine entrepreneurs. And even if all the Virgin empire does is leverage its brand name, at least it does it intelligently. But why the secrecy, Sir Richard? It makes people think you have something to hide.


A couple of years ago Regus founder Mark Dixon won Ernst & Young's Entrepreneur of the Year award. But a couple of days before his victory was announced, Regus pulled its stock market float, causing much soul searching at the accountants.

Mr Dixon, though, received his prize and Regus eventually did float. But its short life on the market has been one of disappointment and misery for those who bought into the Dixon dream. On Friday Regus announced a massive restructuring, which led to it recording an attributable loss of more than £100m.

In the statement Mr Dixon admitted that revenue per workstation – a key measure for Regus – fell by 25 per cent. This contrasts with his comments a couple of months ago when The Independent on Sunday discovered that customers were being offered discounts to stick with Regus. He threatened us with serious repercussions and said "we can't operate our business like that".

We could not agree more – though the repercussions are for Regus, not us.