Friday, 01 January 1993

UK: Profile - Michael Jordan of Cork Gully.

UK: Profile - Michael Jordan of Cork Gully. - Chris Blackhurst talks to the head of Cork Gully, a man in a lonely profession.

Chris Blackhurst talks to the head of Cork Gully, a man in a lonely profession.

1931 - Born in Derbyshire, one of five children, the son of a wealthy builders' merchant. Sent to boarding school aged six, first to prep school, then to Haileybury. Trained as an accountant in Cardiff.

1958 - Joined R H Marsh in London.

1968 - Spoke against Sir Kenneth Cork at a creditors' meeting. Cork was impressed and recruited him. Developed his own contacts and practice. Recognised, like Cork, as one of the so-called insolvency barons, who dominated the world of corporate failure and did not bother themselves with normal, humdrum, accountancy work.

1978 - When Cork took time off to become Lord Mayor of London, Jordan moved up to senior partner. Decided that while the firm was synonymous with insolvency, it also needed a larger partner. Led merger discussions with Coopers and Lybrand.

1990 - After overseeing high profile crashes of the Savings and Investments Bank and Barlow Clowes, Jordan was asked to sort out Polly Peck.

1992 - Now past Coopers' normal retirement age of 60 but plans to carry on for two or three years.

If anyone could be said to be having "a good recession" it is Michael Jordan, head of Cork Gully, the country's biggest firm of insolvency accountants.

While a cold wind blows through other areas of the accountancy profession, Jordan's firm is blooming. High-profile collapses like Polly Peck's and Olympia and York's have come its way as have many of the smaller business failures that are occurring daily. Jordan, a stylish, charismatic figure, is firmly at the top of the tree.

Climbing up to see him is not easy. It starts with the simple request to interview him. Cork Gully is part of Coopers and Lybrand, the international firm of accountants. Their press officer seems unduly apprehensive about the interview. Mention is made of a piece which appeared in The Times and of how there was "a misunderstanding". Provided I agree to clear quotes and do not mind having a Coopers' press person in attendance during the interview, I may see him.

Then there is the small matter of arranging a suitable date. The first appointment is cancelled at the last minute - he has to go to Turkey in a hurry, "on Polly Peck". The second is also rearranged - he has got too much on, before going on a trip to the Far East. Finally, I am assured, there is a firm slot in his diary.

Forewarned is forearmed, so I dig out The Times cutting. It says that Jordan believes that the fashion for creating multi-disciplinary practices is over and we could now see big firms splitting up into their constituent parts. Fair enough. But it continues, "one of his biggest regrets is, he says, merging Cork Gully into Coopers and Lybrand, Deloitte in 1980".

There is a direct quote from Jordan: "I made a big mistake. Sir Kenneth Cork was against it. He said, 'If I were you I wouldn't do it', but I was forced into it because of our name. Clients didn't want us doing their investigative work because they didn't want their creditors to know that they had Cork Gully in there. We had to get under the umbrella of a major firm. We now use the name Coopers for all investigative work."

Jordan, says The Times, has never been a Coopers man. He is quoted again: "It is a vast organisation, run like the civil service and no, it is not really my scene. Everyone is on first name terms and I'm not a great believer in that. I think you should have a bit of respect, particularly for your elders, and I'm not going to have some squirt coming into my office and calling me Michael."

Biggest regret? Big mistake? Squirt? No wonder when I arrive, the Coopers press person is ready, notebook open, pen poised.

Cork Gully has its own building in the City, close to St Paul's and separate from Coopers. Unlike Coopers' headquarters, which is all fountains and sculpted archways, Cork Gully's is a throwback to how offices used to be, before architects and interior designers were allowed to run riot - and before it became the norm for firms of accountants and lawyers to spend money like there was no tomorrow.

The entrance is functional without an overblown atrium or expensive sculpture. Upstairs, Jordan's own office reflects the mood of sobriety - it would be wrong, he points out later, for Cork Gully, a firm advising on insolvency, to have lavish premises. But if his room symbolises thrift - the only eye-catching item is a huge "organogram" detailing the network of companies that went to make up the Polly Peck empire - Jordan himself has a sleek, discreetly expensive look about him.

His face is tanned, his silver hair is swept back and neatly coiffured. His suit is Savile Row, his shirt double-cuffed with silver links, a carefully folded silk handkerchief peeps out of his breast pocket, his shoes are highly polished. He is a dandy, a man who not so long ago, when his first marriage was on the rocks, was a regular at Annabel's, the Mayfair nightclub, with a girl on each arm.

He still has a passion for vintage champagne and caviar but these days he consumes them in private at home with his second wife, Dorothea, whom he married after an especially acrimonious divorce in 1990 (Friends say that this episode, which left him estranged from his two grown-up children, has had a profound effect on him.). Similarly, his Bentley Turbo R will not be seen parked outside his office. He drives it at weekends at his farmhouse in the Chilterns, well away from critical eyes.

He was born in Derbyshire, one of five children, the son of a wealthy builders's merchant.He was sent to boarding school at the age of six, first to prep school, then to Haileybury. Resisting pressure to join the family firm he chose instead to train as an accountant in Cardiff. He joined R H Marsh - now merged with Touche Ross - in London in 1958 but gradually moved away from traditional accountancy and into insolvency. In 1968 he came to the attention of Sir Kenneth Cork, then the doyen of receivers, and was recruited to join his company.

My first question has the Coopers pen racing. He must, I imagined, be doing well, what with hundreds of companies going to the wall every week? "You have to be very careful in this country about being seen to do well at anything. As a nation we are all eaten with jealousy. My wife, who is a Continental, tells me that."

But his success is nothing compared with what he sees as the fate that is before us. "I said in 1989 that we were about to enter the mother and father of a recession, and I see nothing to change that view," he says. "I see a similarity, between the 1930s and now, that is frightening. Bush has been chucked out because he couldn't fix the US economy and in has come Clinton, hopefully as a new Roosevelt. Gatt is in difficulty which raises the prospect of protectionism, just like in the 1930s. We've left the ERM just as, at the beginning of the 1930s, we left the gold standard."

What is required, he maintains, is for the Government to inject "massive support" to get industry back on its feet again. That support should be directed to small businesses as the only way of reversing the unemployment graph. "You can't arrest that climb by pumping money into big business. We've got to get small businesses going again. They are the only people who will employ people again. Until the swing to small businesses takes place we won't get out of this recession."

You get the impression that these remarks are considered and deeply felt - as are his next: "It gives me no joy or pleasure whatsoever to see companies run into difficulties. We dedicate a lot of time to trying to keep companies out of insolvency. I'm a great believer in Great Britain Limited. Nothing would please me more than to see our companies survive and prosper."

Listening and watching Jordan, a possible reason for the press officer's apprehensions becomes apparent. He can't say how much he regrets merging with Coopers - not because of anything personal against Coopers but because the deal cost his firm its independence - for fear of upsetting Coopers' partners.

Likewise, he cannot be seen in the midst of a deep recession to be saying that business has never been better and how much he is enjoying himself. In the same way that an undertaker is forced to do his laughing in private, an insolvency practitioner has to preserve a sober public face. When Jordan says that his great pleasure is pottering about on his own at his farmhouse, doing DIY - installing an electronic security system is his current pet project - you feel for him.

No doubt while he potters he thinks about how Cork Gully has grown like topsy these past few years, how he wished he had kept the firm independent, which will be the next major company to go bust, why such and such a business was doomed to fail. In public, a combination of Coopers' sensitivity, his own desire to curb his natural outspokenness and in cases like Polly Peck, legal restraints, have taught him to play dumb.

He comes across - to use a cricketing analogy - as a batsman whose natural instinct is to play off the front foot but who is forced to play off the back. His defensiveness makes him appear cold and aloof. His smile has been described as sardonic, but he is reserved, rather than cold; his smile is knowing. At the end of our meeting, he took the trouble to accompany me in the lift and to show me the way out. The Coopers press person stayed behind. Jordan was chatty, relaxed and friendly, his handshake firm and warm.

Inevitably, given the nature of his work, cynicism creeps in. He spends his life clearing up the mess created by others. Lessons that should be learned are ignored and the country stumbles from one spectacular corporate failure to the next. It is not Jordan's job to teach and lecture - which is a pity. Because if anyone knows why some companies succeed and others fail, it is he.

In a word, he says, the answer is "mis-management". When businesses run into trouble, all sorts of excuses ranging from fraud to unfair competition are propounded but usually, management is to blame.

Experience has taught him that "a company needs two managements to run it, one in the boom times and the other in recessionary times". In his view, each extreme in the cycle requires a new management team. "You need a different style to get through a recession than through a boom," he says. "Surviving a recession is all about watching the bottom line, running a tighter ship, cutting back to the core businesses."

Those companies - like Burton, Next and Storehouse - that expanded rapidly in the late 1980s, ran into difficulty but changed their management in time, should pull through. Others that were still clinging to the old guard might not be so lucky.

When Cork Gully is called into a business, either by the company itself or, more often than not, by concerned creditors, the first thing Jordan and his team do, is to listen to senior and middle management. The bigger the company and the bigger the problem, the chances are, he says, that one individual, the man at the top is responsible. "There is a saying that it takes a big man to make a big mess and a small man only makes small messes."

The man at the top might not be ignored but he may not find himself part of the company's fight to get out of trouble. The top man would say how he grew the company, middle management would say where he went wrong. "We pick the brains of the chap who made the big mess," says Jordan. "But what is normally very good is the middle management team. We try and pick their brains and latch on to them."

The key, he says, is understanding what went wrong. "If you can work out how the company got into difficulties, you are a long way to resolving its problems."

His team, he says, will not go into the company with the intention of closing it down. If a company is not profitable, "we will try and make it profitable. If we can see light at the end of the tunnel every effort will be made to save it and the employees."

Frequently that means breaking the company up and selling off bits. Although, as Jordan points out, the depth of this recession is making it "more difficult to sell assets and to get a good value for those assets". He dismisses criticism that assets are sold too cheaply. "We always ask for best and final offers. Those who claim they offered a higher price should reconcile that with what they actually said to us at the time."

No matter how hard he tries, Jordan cannot win - someone is always injured. "Insolvency is full of criticism," he says. "People always get hurt. The employees who lose their jobs get hurt, the bankers who have not yet got their money back get hurt. When people are losing their jobs and money, it is impossible to avoid criticism. We are doing a very good job in very difficult conditions."

As to his staff and colleagues at Coopers, he professes to be full of admiration for them. "I never called anybody a little squirt. I referred to them as 'young Turks', not little squirts."

Did he not say, though, that he regretted merging? "I'm not saying they weren't the words I said. Don't forget, I gave up my independence when we joined Coopers. I'm amazed all the partners at Coopers have put up with me for so long. I hope I can say sorry at times." He pauses. "I am a bit of a loner, I know, but in fairness to myself, insolvency is a very lonely profession to be in."

Now, as he moves past Coopers's normal retirement age of 60, he finds himself busier than at any period of his career. He plans to carry on for another two or three years. "I should think this recession will see me out".

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