Supermarkets are good for you. That was the provisional verdict of the Competition Commission as it finished the latest investigation into the dominance of Tesco and pals.
The results of the probe amounted to a whitewash, if you believe any number of high-street and consumer pressure groups. The main finding of the report was that there was no evidence to show that supermarkets damaged smaller, independent stores.
But in the sleepy Norfolk market town of Sheringham, which is facing the prospect of a new Tesco, the verdict has only angered local businesses. The town's chamber of commerce calculates that more than 10 per cent of its high-street businesses will close within 12 months of the Tesco store opening. Or how about this from Bob Farrand, chairman of the Guild of Fine Food who said on Friday that the commission's ruling was "a gold-plated template to destroy our high street".
Strong stuff indeed. What is clear is that the commission was more concerned about address ing the competitive relationship between the big four supermarket chains of Tesco, Asda, Sainsbury's and Morrisons than the social impact of the giant retailers on the high street and the fabric of local communities.
Tesco's fabled land bank - which its critics claim is used to stymie its rivals from building new stores in key areas - will come under pressure. In total, the commission identified 105 sites across the country controlled by supermarkets - out of a total of more than 800 - that gave it cause for concern. Suppliers to supermarkets may also get a lift in the form of an independent ombudsman to make sure farmers and others are not given a raw deal by supermarkets.
Some of the best research to come out since the commission published its findings has been from consultancy MPC Associates. It points out, quite rightly, that the commission made no attempt to define what a supermarket actually is. The commission's use of the word is misleading because it is used to embrace the whole of the British retail food industry, so distorting and hiding the true competitive effects of food retailing in the UK today.
MPC also points out that the commission did not take into account that some parts of the UK have a saturation of food retailing. Any form of hypermarket or superstore development in these areas is likely to cause "utter chaos", with increased traffic congestion and carbon emissions both in and out of town.
My own view on supermarkets, as I have stated before, is not that they are some sort of evil blight on our green and pleasant land - as some would label them. If supermarkets did not provide a good service, consumers would not shop there. Sorry if that sounds frightfully simplistic, but frankly, no one forces a single person to go into a Tesco or an Asda.
Anyway, supermarkets are not out of the woods yet. The Office of Fair Trading is still running its own investigation into Tesco and pals and its findings may be as palatable to supermarket bosses as one of their own value- range mince pies.
It is usually the job of executive directors at a plc to put forward and implement strategies for their businesses. It is the job of the non-executive directors, led by the chairman, to provide the oversight to those strategies and to represent the interest of shareholders.
So what exactly is going on at Standard Life? Gerry Grimstone, the chairman of the insurer, has made it clear that the company's takeover bid for Resolution is his baby. He is, as he proclaims "a former M&A banker" with experience of carrying out complex deals. Well, he is not doing a very good job of it at the moment.
On Friday, Standard Life issued its statement on the mer-ger benefits of a deal with Resolution. It was the second time Standard Life has made the statement. On the first occasion, the company was forced to retract it after omitting to run the advantages of the proposed deal past the Takeover Panel - a prerequisite for making such statements to the stock market.
Friday's statement included the claim that it could wring out £250m in cost savings from the Resolution deal by merging the two companies' funds. But the fly in the ointment is that Pearl, which is also trying to buy Resolution and already has a 24.2 per cent stake in the company, has said it will oppose the Standard Life takeover bid.
Pearl's stance makes it impossible for Standard Life to achieve the 75 per cent shareholder support it would need to merge its funds with those of Resolution. This renders its statement on Friday meaningless. What Sandy Crombie, chief executive of Standard Life, makes of all of this is an interesting question. It must be like being involved in a slow-motion car crash. One is led to wonder whether Standard Life's corporate governance was better in its old mutual days.Reuse content