British Gas can't fix my boiler, so can the new boss repair customer service?


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Our boiler chose the onset of cold weather as the moment to spring a leak.

Cue four consecutive days of visits from British Gas engineers, parts-ordering and teeth-sucking until the appliance is mended. I thought our boiler cover was meant to spare us such domestic hassle.

It’s been a quiet few months for the energy sector. A mild autumn has meant the big six providers will have sold less gas, but faced fewer public attacks. Now it’s getting chillier, stand by for the seasonal row over sky-high bills.

Centrica, the parent of British Gas, has been a company with an upstream boss and a downstream problem. Formerly of Chevron and Amerada Hess, Sam Laidlaw has spent billions securing Britain’s future energy supply with deals in Norway and Qatar. The beginning of production next year at the Cygnus gas field in the North Sea is another sizeable tick in the box.

But Centrica’s reputation will struggle unless British Gas shapes up. Together with its peers, the division must make its pricing far more transparent and up its customer service. Something is wrong if, despite all that faffing about, its residential services arm maintains some of the best profit margins in the group.

Mr Laidlaw’s handover to his successor, Iain Conn, is in full swing. There are two views of the BP man. The first is that he is a brilliant appointment – very capable and overdue a chief executive posting after being passed over at BP because he was tarnished alongside colleagues by the Gulf of Mexico oil spill. The other is that he is a little too sure of himself to lead a business that must be public citizen first, public company second.

I fear his customer-service credentials might have been overstated. Mr Conn has been lauded for the marketing genius behind the Castrol oil brand and overseeing BP’s 18,000 petrol stations. Does that give him the common touch to overhaul a company, or, unlike the boiler engineer who finally did the trick for us, will Mr Conn be reluctant to get his hands dirty?

Quietly, some bosses are breaking ranks over Europe

 Philip Hammond was an interesting choice of speaker for TheCityUK’s annual dinner at Mansion House on Tuesday. The Foreign Secretary found himself under attack from the outgoing European Commission President, Jose Manuel Barroso, for suggesting Britain was “lighting a fire under the European Union” with the Conservatives’ in-out referendum. His language has been at odds with TheCityUK’s more measured push for reform.

Mr Hammond was at pains to emphasise that the call for greater competitiveness is being heard as he tours European capitals. But that big conversation is at odds with David Cameron being deserted by allies in Scandinavia on the key topic of immigration. And Mr Hammond needs a better example of national disaffection than a poor turnout in fringe member Slovakia for the most recent European parliamentary elections.

The concern of business is that it can’t cut through the negative rhetoric on Europe at the moment. The CBI has an idea for Nicky Morgan, the Education Secretary – to generate warmer feelings towards the region by sending university undergraduates to study in a different member state for a year. Only 3 per cent do so currently.

But that is for the long term. In the short term, I detect that behind the European reformists, there is the odd business leader who is not prepared to give negotiation the time to work.

One frustrated boss I had lunch with this week surprised me by volunteering that it was time for Britain to leave. And this from a man who knows all about the benefits of being part of a larger trading bloc, including the single market of labour that most British companies rely on.

Accounting reforms don’t  stand up to a proper audit

Royal Bank of Scotland is trying so hard to make itself over since its taxpayer bailout that it is no surprise Deloitte is being dropped as the company’s auditor. This is a relationship that dates back only to 2000, but anything linked to the Fred Goodwin era must be expunged.

Other FTSE 100 members have far longer relationships, often stretching for decades, with the accountancy firms that approve their books. Where an auditor has been in place for more than 20 years, a new rule demands a switch by 2020. This is heralding an unprecedented amount of activity in the audit world and not all of it good. Rather than increasing competition, there is a suspicion that the largest firm, PwC, might end up with a 50 per share of FTSE 100 audits when the dust has settled.

The problem is that any audit firm outside the big four – PwC, EY, Deloitte and KPMG – hasn’t got a network of offices big enough to service a global company based here. This means that in the act of ditching one firm, companies are left with a credible choice of three – before taking possible conflicts, such as consulting work, into account.

Anecdotally, choice doesn’t improve much outside the FTSE 100. One non-executive director who sits on the audit committee of several mid-sized companies said that when smaller auditors are invited to pitch for their business, the quality of the submission is frequently embarrassing.

One beancounter compared notes with people in other industries and worked out that the audit market is now more highly regulated than the nuclear industry. But will this latest merry-go-round make it easier to spot the next Goodwin-style corporate meltdown?