Patience Wheatcroft - the human factor

Patience Wheatcroft - the human factor - When Allan Leighton announced that he was leaving Wal-Mart but would not take on another chief executive role, corporate climbers everywhere did a double take. If someone not yet 50 and bursting with management mac

by PATIENCE WHEATCROFT, business and City editor of The Times
Last Updated: 31 Aug 2010

When Allan Leighton announced that he was leaving Wal-Mart but would not take on another chief executive role, corporate climbers everywhere did a double take. If someone not yet 50 and bursting with management machismo had decided there was more to life than running the show, perhaps they should re-examine their own ambitions.

Leighton has earned himself a reputation as one of the country's top managers. Although Archie Norman drew up the blueprint for resurrecting Asda, it was Liverpudlian Leighton who saw it through and ensured that the grocer could sell to the Americans from a position of strength.

His success has catapulted him to the top of senior head-hunters' wish lists. It seemed that, once he tired of being Wal-Mart's man in Europe rather than his own man in Leeds, he'd have the pick of the sits vac. But he is opting out.

To listen to the stunned reaction from the business world, one might think he was heading for the Good Life and a spot of sheep farming in the distant dales. In fact, he has opted to 'go plural', aiming to collect a portfolio of roles, including the chair at a FTSE-100 company, so he is not planning an exit from the publicly quoted stage (he has already accepted the chair of lastminute.com). He no longer wants to be in the day-to-day driving seat of a major company. Leighton is not quite talking about finding time to smell the flowers and take up watercolours, but he is keen on the prospect of a more flexible, less frantically paced lifestyle.

He admits that watching his daughter planning her travels for her post-university gap year kindled envy in someone who has spent his adulthood at the beck and call of two employers.

Sceptics suggest his new resolution is based more on expediency than a dramatic change of heart. A man who volunteered to succeed Bob Ayling at British Airways, arguing that although he knew little about airlines, one service industry was much like another, is unlikely to see his ambitions doused overnight. Had he been able to become chief executive of Marks & Spencer he would almost certainly have delayed changing his lifestyle.

But Philip Green, who had lined him up for the role, dropped his idea of a hostile takeover of M&S.

Luc Vandevelde, the new chairman, saw the logic of appointing Leighton, who would have made an instant impact on lifting staff morale from where it languishes at floor level. Wal-Mart, however, did not warm to the idea of him leaving to join a business it judges to be a competitor.

Its insistence on a period of gardening leave made both him and M&S rethink their plans. Although it now seems that M&S will have to wait months for the man it did appoint, albeit to the lesser role of chief executive of UK stores, Leighton is convinced he made the right decision.

He may be part of a trend. In September, Roberto Quarta, chief executive of BBA, caused a stir and left his share price shaken when he announced he was giving up the job. After seven years of hard work at the engineering group, he had more than doubled the share price but felt his efforts should have produced more. So Quarta is heading for the world of private equity, where the deals are big and the rewards great.

He has chosen to join Clayton Dubilier & Rice, one of the more established US private equity firms. He follows the trail made by Philip Yea, who left the finance director's job at Diageo to join Investcorp, the Bahraini-funded private equity house.

Steve Grabiner had difficulty finding a comfortable employment environment, causing Lord Hollick some ire when he decided to leave United News & Media to join On Digital. Within months he was off to eVentures, but before he had even moved into his office he diverted to Apax Partners, where even this restless soul seems to have settled down.

It wouldn't be surprising if Leighton joined this procession, even if his new lifestyle choice precluded a full-time role. Armed with oodles of cash, the deal-doers at private equity firms need to be able to call on expert industry advice. Leighton, with his in-depth knowledge of the grocery industry, would have valuable insights to offer.

It is the privacy aspect of private equity that appeals to many of its new recruits. They can operate untroubled by shareholders and away from media scrutiny and can reward their partners on a scale that would elicit shrieked accusations of fat-cattery in a publicly quoted company.

Being chief executive of a major public company can be a gruelling exercise in which the competing demands of analysts and the media, corporate governance procedures and shareholder meetings distract from the business of running it. As Leighton seems to have realised, there are other ways to have fun and make money.

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