Margareta Pagano: Should we care about all these alpha males?
Sunday 22 May 2011
What a week it's been for alpha males behaving badly.
In New York, Dominique Strauss-Kahn appears to have taken his droit du seigneur so seriously he is being tried for rape, while Munich Re has been forced to confirm that its top insurance salesmen were rewarded with escort girls at a thermal spa "sex party" in Budapest; red armbands were worn by hostesses willing to flirt only, while yellow showed those willing to provide all services.
In London, the court decision to scrap the super-injunction taken out by Sir Fred Goodwin, former chief of Royal Bank of Scotland, lifted the lid on what all Fleet Street had suspected for months but couldn't report – that he was enjoying an affair with a senior bank executive at the time of the bank's collapse.
It is tempting to indulge in a little cod psychology; to suggest that these high-powered businessmen are classic alphas; driven and ambitious – or "rutting gorillas"– as DSK has been described – and that they are merely being true to type.
But this would be dangerous; each of the cases is different and it is superficial to lump them together. Indeed, it is also worth asking whether the sex lives of these individuals is in the public interest, or if it has had any real impact on their business performance.
By all accounts, DSK has been a tremendous head of the IMF; charismatic and thoughtful. He turned the IMF from a "talking shop" quango with overpaid officials and over-large egos into a serious debating house, helping Europe sort out its woes. He may be le grand séducteur as the French heroically described him before the latest affair – but did that affect his judgement? I doubt it. If he is proven guilty of a criminal offence, that's quite another matter, and he should be jailed.
Sir Fred and his woes may be a little tamer, but the fuss is just as big, and is possibly being made out of all proportion for the wrong reasons. There's no doubt that the use of super-injunctions is a bad thing, but I do worry that much of the press is expressing moral outrage simply because it leads to titillating headlines rather than on real grounds of public interest.
And that's a pity. It clouds a more important issue – that the authorities have not published the full report into how RBS collapsed. What we want – and are entitled – to know, is how Sir Fred and his board, which included heavy-hitters such as Sir Peter Sutherland, Sir Steve Robson and Sir Tom McKillop, allowed RBS to go bust and to be rescued with $45bn of taxpayers money. I want to see Sir Fred – and the others – explaining this in front of Parliament or a commission. If the internal inquiry into RBS were to show us that Sir Fred's attention had been diverted because of personal problems, then knowledge of his private life might be justified. If not, it's a separate matter.
All this raises fascinating questions about how much we should know about our business leaders, and how they should be called to account. Are their sex lives any more important than other personal issues, such as health? Should investors be given files on cancer-sufferer Steve Jobs of Apple, say, to get the latest on his illness and so know when to sell? Please, no. I don't think so.
En Garde, Sarkozy! If Lagarde loses IMF, she could aim even higher
The hot money is still on Christine Lagarde, France's Economics Minister, to take over from Dominique Strauss-Kahn, as head of the International Monetary Fund after his resignation last week, despite calls for the job to go to a non-European. Many of the IMF's members want the job to go to someone from an emerging economy, even though, under the original post-war deal, the top job was to go to a European while the senior World Bank position was to be filled by an American. Lagarde has gained enormous respect for her work during the financial crisis but there are two other factors which may work against her – France has held the IMF job four times already and there is a judicial review into a case she has been involved with. If she isn't chosen, then maybe Lagarde should be persuaded to take another of DSK's presumed roles, that of a candidate to challenge President Nicolas Sarkozy in next year's election. She's made a name on women's quoas and cutting banker's bonuses; a good start for the campaign.
Even in these Kindle times, savvy businessmen are snapping up book shops
What do Alexander Mamut and John Malone know that we don't? Mamut is the Russian billionaire businessman who has just paid £53m to buy 296 Waterstone's book shops from HMV, while the US billionaire Malone and his Liberty Media group are offering $1bn to buy Barnes & Noble – which, with 720 shops, is America's biggest book chain.
The two bids come just as Amazon, the world's largest seller of books, announced that e-books for its Kindle are outselling itsold-fashioned paper books by two to one, and that it is enjoying the strongest growth for a decade. If electronic books are roaring ahead, why are these two serious businessmen prepared to shell out so much money to take over struggling retailers?
Mamut, who has the backing of founder Tim Waterstone, has already lined up James Daunt of the independent Daunt book shops as his MD, so you can see exactly the sort of shops he's aiming for. And he's right; Waterstone's needs to go back to the beginning to what made it great in the first place; great books, great customer service and great ambience. The attempt by Waterstone's to be all things to all men has unquestionably been a disaster – sales down 11 per cent.
But Mamut must also be thinking about the future too, and, on top of investing in the shops (and maybe closing some) must be thinking about introducing Waterstone's own electronic book. Leonard Riggio, the founder and biggest shareholder in Barnes & Noble, did just this by investing in his own Nook e-reader two years ago. But it hasn't been enough to turn around the finances and that's why he put the business up for sale last year – he didn't want to end up like America's Borders, the colourful book chain that had to file for bankruptcy earlier this year. With Malone's backing, he will be able to invest more and will be revealing more details about the Nook this week.
How refreshing that Mamut and Malone are risking their money with such noble intent.
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