Pearson succession draws fire from City analysts

Pearson's long-awaited management succession plan, unveiled yesterday, drew immediate fire from analysts and disappointed some key shareholders. The shares fell 11.5p to 676.5p, a drop of 1.7 per cent.

The appointment as deputy chairman of Dennis Stevenson, the man credited with saving aircraft leasing company GPA from financial collapse, was viewed as a positive step. Mr Stevenson will take over as chairman in the spring, when Michael Blakenham, the last of the Cowdray family to take an executive role at Pearson, steps down. Mr Stevenson is also expected to resign from his high-profile role as chairman of the trustees of the Tate Gallery.

But analysts questioned the appointment of Marjorie Scardino, the little- known chief executive of the Economist, who takes over from Frank Barlow, the managing director, at the end of the year, becoming the first chief executive of a FTSE 100 company.

"So Pearson now has a journalist for a chief executive, a journalist [John Makinson] for a finance director and a management consultant as chairman," said one leading analyst who has been critical of Pearson in the past. "I rest my case."

"We haven't heard of her, and we wonder whether she can be up to the job, given her background," added another analyst.

"This is certainly disappointing because [Ms Scardino] is not a big hitter," Louise Barton, analyst at Henderson Crosthwaite, said. "Running the Economist is far different from running a major PLC."

There was also concern that the appointment came from within Pearson's empire. "They should have gone for a true outsider," complained one analyst.

But Pearson senior executives dismissed the criticisms. "The City always reacts this way," Mr Barlow said. "But the City also always gives new chief executives some room and some time."

He added: "When they get to know her, they will see how capable she is."

The appointments, which were decided last month but delayed by contractual negotiations, mark the end of a series of management changes aimed at preparing for the retirement of Lord Blakenham and Mr Barlow. Between them, they oversaw the transformation of Pearson from a collection of luxury companies such as fine china, oil exploration, financial services and publishing into an integrated media giant, worth nearly pounds 4bn at yesterday's market price.

All the same, the company has been a takeover target in recent months, following a disastrous foray into the CD-Rom and games cartridge market in the US and persistent criticisms in the City that the company continued to lack focus.

Ms Scardino, an American-born lawyer and one-time newspaper publisher, is credited with growing the Economist businesses, particularly in the US. She said she would spend the next few months "looking closely at Pearson and at the opportunities".

She added that she and Mr Stevenson had "no strategic prejudices, and will start with a clean slate". Neither executive would discuss strategy in detail, but it is believed the board of Pearson has not ruled out dramatic changes, which could include the sale of some key assets, or perhaps the spinning off to shareholders of the television subsidiary.

All the same, Ms Scardino said: "We will do what we think is right. If it popular to do something we won't just do it if we think it is wrong. We will stand our ground."

Scardino at the top, page 3 Comment, page 23

Suggested Topics
Alexis Sanchez has completed a £35m move to Arsenal, the club have confirmed
sportGunners complete £35m signing of Barcelona forward
Poor teachers should be fearful of not getting pay rises or losing their job if they fail to perform, Steve Fairclough, headteacher of Abbotsholme School, suggested
voicesChris Sloggett explains why it has become an impossible career path
world cup 2014
Popes current and former won't be watching the football together
Arts and Entertainment
Celebrated children’s author Allan Ahlberg, best known for Each Peach Pear Plum
Wayne’s estate faces a claim for alleged copyright breaches
newsJohn Wayne's heirs duke it out with university over use of the late film star's nickname
Life and Style
It beggars belief: the homeless and hungry are weary, tortured, ghosts of people – with bodies contorted by imperceptible pain
lifeRough sleepers exist in every city. Hear the stories of those whose luck has run out
peopleIndian actress known as the 'Grand Old Lady of Bollywood' was 102
Arts and Entertainment
Currently there is nothing to prevent all-male or all-female couples from competing against mixed sex partners at any of the country’s ballroom dancing events
Potential ban on same-sex partners in ballroom dancing competitions amounts to 'illegal discrimination'
Mick Jagger performing at Glastonbury
ebookA unique anthology of reporting and analysis of a crucial period of history
Germany's Andre Greipel crosses the finish line to win the sixth stage of the Tour de France cycling race over 194 kilometers (120.5 miles) with start in Arras and finish in Reims, France
tour de franceGerman champion achieves sixth Tour stage win in Reims
Life and Style
beautyBelgian fan lands L'Oreal campaign after being spotted at World Cup
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Business Analyst Consultant (Financial Services)

£60000 - £75000 per annum: Harrington Starr: Business Analyst Consultant (Fina...

Systems Administrator - Linux / Unix / Windows / TCP/IP / SAN

£60000 per annum: Harrington Starr: A leading provider in investment managemen...

AVS, JVS Openlink Endur Developer

£600 - £700 per day: Harrington Starr: AVS, JVS Openlink Endur Developer JVS, ...

Technical Support Analyst (C++, Windows, Linux, Perl, Graduate)

£30000 per annum: Harrington Starr: A global leader in trading platforms and e...

Day In a Page

A History of the First World War in 100 Moments: Peace without magnanimity - the summit in a railway siding that ended the fighting

A History of the First World War in 100 Moments

Peace without magnanimity - the summit in a railway siding that ended the fighting
Scottish independence: How the Commonwealth Games could swing the vote

Scottish independence: How the Commonwealth Games could swing the vote

In the final part of our series, Chris Green arrives in Glasgow - a host city struggling to keep the politics out of its celebration of sport
Out in the cold: A writer spends a night on the streets and hears the stories of the homeless

A writer spends a night on the streets

Rough sleepers - the homeless, the destitute and the drunk - exist in every city. Will Nicoll meets those whose luck has run out
Striking new stations, high-speed links and (whisper it) better services - the UK's railways are entering a new golden age

UK's railways are entering a new golden age

New stations are opening across the country and our railways appear to be entering an era not seen in Britain since the early 1950s
Conchita Wurst becomes a 'bride' on the Paris catwalk - and proves there is life after Eurovision

Conchita becomes a 'bride' on Paris catwalk

Alexander Fury salutes the Eurovision Song Contest winner's latest triumph
Pétanque World Championship in Marseilles hit by

Pétanque 'world cup' hit by death threats

This year's most acrimonious sporting event took place in France, not Brazil. How did pétanque get so passionate?
10 best women's sunglasses

In the shade: 10 best women's sunglasses

From luxury bespoke eyewear to fun festival sunnies, we round up the shades to be seen in this summer
Germany vs Argentina World Cup 2014: Lionel Messi? Javier Mascherano is key for Argentina...

World Cup final: Messi? Mascherano is key for Argentina...

No 10 is always centre of attention but Barça team-mate is just as crucial to finalists’ hopes
Siobhan-Marie O’Connor: Swimmer knows she needs Glasgow joy on road to Rio

Siobhan-Marie O’Connor: Swimmer needs Glasgow joy on road to Rio

18-year-old says this month’s Commonwealth Games are a key staging post in her career before time slips away
The true Gaza back-story that the Israelis aren’t telling this week

The true Gaza back-story that the Israelis aren’t telling this week

A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
A History of the First World War in 100 Moments: The German people demand an end to the fighting

A History of the First World War in 100 Moments

The German people demand an end to the fighting
New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

New play reveals what Oscar Wilde said at trials

For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
Can scientists save the world's sea life from

Can scientists save our sea life?

By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
Richard III, Trafalgar Studios, review: Martin Freeman gives highly intelligent performance

Richard III review

Martin Freeman’s psychotic monarch is big on mockery but wanting in malice
Hollywood targets Asian audiences as US films enjoy record-breaking run at Chinese box office

Hollywood targets Asian audiences

The world's second biggest movie market is fast becoming the Hollywood studios' most crucial