James Moore: This boardroom stand-off is unseemly now AA is a public company
Outlook The AA’s boss Chris Jansen has all of a sudden found himself in the position that his customers hire his company to get them out of.
He’s stuck at the side of the road waiting for someone to pick up him after his job as chief executive of the AA, well, broke down.
“We completely understand and respect Chris’s desire to seek new challenges outside the AA,” gushed chairman Bob Mackenzie as Mr Jansen’s imminent departure was announced (with finance director Andy Boland soon to follow). Mr Jansen’s statement on the matter struck a similar tone. They’re all great pals really.
Still, Mr Mackenzie’s desire to rule the roost clearly had no small role to play in Mr Jansen’s “desire” for a new challenge just eight months after taking on the job.
Mr Mackenzie has no intention of being the “elder statesman” that Mr Jansen described him as when the road assistance firm floated. And therein lies the problem.
Mr Mackenzie boasts the title of executive chairman and will retain it indefinitely. Even if he does get around to hiring a chief executive it looks like they may end up being, in effect, a chief operating officer with a fancy salary and title. At best. The “lucky” candidate might just end up them being one of Britain’s best-paid bag carriers.
That wouldn’t matter so much if the AA were still owned by private equity firms. If they want all-powerful generalissimos running their companies then more fool them (the sensible ones don’t). But thanks to the work of Mr MacKenzie, the AA is now a public company.
Those who take the public’s pensions and other savings to further their business ambitions ought to be willing to accept the requirements and responsibilities that come along with doing so.
One of the most important of those is that the roles of chairman and chief executive are kept separate. The latter should be allowed to run the business while the former runs the board in a non-executive capacity.
This isn’t simply a matter of box ticking by corporate governance wonks that can be satisfactorily dealt with by way of a few words somewhere in an annual report. The rule was put in place with good reason even if it doesn’t always work as well as it might in practice (see Goodwin, Fred and Scotland, Royal Bank of).
On behalf of their investors, to whom they have a fiduciary duty, the institutions who backed Mr Mackenzie in taking the business public now need to make it clear to him that they weren’t handing him a blank cheque as regards governance.
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