ICI hits at single market delays

Click to follow
The Independent Online
Sir Ronnie Hampel, chairman of ICI, warned yesterday that European companies were suffering due to the lack of progress in fully completing the single market in Europe. Sir Ronnie claimed that US companies had a 2 to 3 percentage point advantage in their return on assets simply due to the efficiency of their own internal market in North America.

"One of the things which concerns us most is not the politics of Europe - I refer to the debate over EMU and the single currency - but that the internal market has not been of the highest priority. There are still significant barriers to the free flow of trade," he said.

The controversy over more political areas had distracted attention away from the importance of the single market. Regulations for energy, transport and the safety of products remained with national governments, despite the free trade in goods opened up by the single market. By comparison, the single currency was "icing on the cake", Sir Ronnie suggested.

But, addressing shareholders yesterday at the annual meeting of the chemicals giant, Sir Ronnie said he was surprised and encouraged by the importance attached to the issue by the European Commission on a recent visit to its president, Jacques Santer, and other officials.

"There is a recognition that if we do not get an internal market up to the levels of the Americans and, in the not too distant future, those of Asia, we have real difficulties ahead of us. So I am not without hope, but I think it will be a long haul."

Sir Ronnie had to field a wide range of questions from the floor, ranging from his taste in ties to the pressure ICI workers were being put under by the group's demanding financial targets. David Sofer, a long-standing shareholder, wished him well. "The fact that you have not grown your hair long - what is left of it - and do not wear flashy ties does not bother me," he said, in an obvious comparison with the trade marks of one of Sir Ronnie's more colourful predecessors, Sir John Harvey-Jones. But the shareholder was more concerned about whether ICI's executive directors handed over to the company fees earned while sitting as non-executive directors on other boards.

In reply, Sir Ronnie said ICI encouraged its directors to take up non- executive positions elsewhere after sitting for a year on the board. But the company took the view that they should keep their fees, given the onerous nature of a non-executive's duties and the fact that they were equally liable in law for their actions with the other, executive members of the board.

The group's shares dived another 26p to 900p yesterday, making a two- day fall of 54p after poorly received results.

Comments