Royal Mail closes in on Canada Post boss
Thursday 27 May 2010
Royal Mail is poised to appoint its first female chief executive within days. The state-owned company is said to be in advanced talks with the chief executive of Canada Post, Moya Greene, after Adam Crozier, Royal Mail's former boss, left to join ITV last month.
Ms Greene, who took over at Canada's federal-owned postal service in May 2005, is credited with increasing productivity and stringently cutting costs. Canada Post declined to comment and Royal Mail did not return calls last night.
The imminent appointment comes at a crucial moment in the history of the UK postal operator, whose operating profit rose by 26 per cent to £404m in the last financial year. The coalition Government this week confirmed plans to partly privatise Royal Mail, with a stake of up to 49 per cent being sold to investors.
This is likely to provoke a fierce response from the Communication Workers' Union, but David Cameron's administration hopes to dampen the flames of opposition by promising to keep post offices under public ownership.
Ms Greene is said be the clear front-runner to land the role, although her appointment would have to be signed off by the Government, which remains the sole shareholder in Royal Mail. She is thought to be on a final shortlist of two or three candidates.
During her time at Canada Post, Ms Greene has taken the plaudits for improving its online operations, reducing absenteeism and increasing automation. Such experience could be crucial at Royal Mail, where Mr Crozier constantly stated the need for it to modernise outdated working practices and stem a decline in mail volumes. The Canadian postal operator has not been affected by major industrial action for about a decade – an enviable track record that strike-prone Royal Mail would welcome.
In the year to 31 December, Ms Greene helped Canada Post to triple its profits to C$281m (£1,183m), despite a 5.1 per cent fall in revenues and 8 per cent drop in mail volumes. Its 14th consecutive year of profits growth was driven by spending cuts of C$500m last year.
Royal Mail managed to raise its profits despite a series of strikes by postal workers last autumn. However, it also faces declining mail volumes and handles 13 million fewer letters a day than it did five years ago, partly because of stiffer competition. Its revenues fell by 2 per cent to £9.35bn last year – their first decline in a decade.
Royal Mail also faces the significant issue of its pension fund deficit, which is expected to be revised up from £3.4bn to least £10bn in its three-yearly valuation, due next month.
Last week, the Royal Mail chairman, Donald Brydon, said: "These are good [annual] results achieved against a backdrop of harsh economic conditions and the relentless reduction in the number of letters sent by customers, not just in the UK but around the world."
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