Sir John Rose will step down as the chief executive of Rolls-Royce in March next year, after 14 years at the helm of one of Britain's most successful engineering groups. The company announced yesterday that Sir John will be succeeded by John Rishton, a non-executive director, who is currently the chief executive of Dutch retail group Royal Ahold.
Sir Simon Robertson, the Rolls-Royce chairman, led the plauditsyesterday, extolling Sir John's "leadership, strategic vision and tenacity" in creating a company which expects to double its revenues in the coming decade. "John has led a transformation in Rolls-Royce which has few parallels," Sir Simon said. "The group has developed into a truly global company." Sir John himself applauded Rolls-Royce's "teamwork and technology", describing the "tremendous privilege" of working with the people at what he described as an "extraordinary company".
Mr Rishton will have a tough job living up to his predecessor's example. Knighted in 2003 for his services to British industry, Sir John's stint as chief executive has transformed Rolls-Royce into the world's second-largest jetengine manufacturer, and seen itcement its position in the power and marine sectors. He has also proved an outspoken champion of UK manufacturing, both internationally and in Whitehall. He acted as an advisor to Gordon Brown while he was Prime Minister, and is understood to have turned down the offer of the Trade Minister's post from the newly-elected Coalition Government.
Rolls-Royce's figures tell an equally impressive story. Since Sir John'sappointment to the top job in 1996, revenues have more than tripled and profits are up by five times. The company's market capitalisation has alsorocketed – to more than £11bn – thanks to more than 300 per cent boom in the stock price.
Mr Rishton, who has been a non-executive director of Rolls-Royce since 2007 and is chairman of the group's Audit Committee, is not an unknown quantity in British business. After several years with Ford, Mr Rishton was BA's finance director for four years, only moving on to Royal Ahold in 2006 after he was passed over for the top job in favour of Willie Walsh. He is widely credited with playing a key role in arestructuring overseen by former BA boss Rod Eddington that included 14,000 job cuts.
At Rolls-Royce, Mr Rishton will be paid £850,000 per year, slightly less than Sir John's £867,000 rate, plus a maximum annual bonus of 155 per cent and another £1m-worth of shares through a long-term incentive scheme. He will also get a grant of shares worth £2.8m, as compensation for incentives he forfeits on leaving Royal Ahold.
Rolls-Royce's acclaim for Sir John was echoed by politicians and City analysts yesterday. "Sir John Rose has been a tremendous business leader for Rolls-Royce," the Business Secretary, Vince Cable, said. "As a champion of UK advanced manufacturing I want to thank him for the huge contribution he has made to strategic thinking both within business and government on growing global market share."
Howard Wheeldon, senior strategic adviser at BGC Partners, said: "Contemplating Rolls-Royce without John Rose is like imagining strawberries without cream."
The smooth transition from Sir John to Mr Rishton, orchestrated by Sir Simon as Rolls-Royce chairman, is in marked contrast to the debacle he has just overseen as senior independent director at HSBC. The bank was in turmoil for more than two weeks after the announcement that chairman Stephen Green is to become the Government's Trade Minister, which culminated in HSBC chief executive Michael Geoghegan also stepping down after he was passed over for the chairman's job.Reuse content