Reprise: The first ten years

MT has presented these influential awards for a decade now. Andrew Saunders looks back in admiration at previous winners and pinpoints the shifts in corporate reputation. It's 10 years since the Britain's Most Admired Companies Awards first appeared in MT, finding its permanent home after appearing intermittently elsewhere since 1989. High time, we decided, for a review of the Awards, a look at the lessons learned and the fates of some of our early winners. The essence of the survey, then as now, is an in-depth look at the components of corporate reputation. A peer review, it harnesses the opinions of the competition (and who knows a business's strengths and weaknesses better than its rivals) in an attempt to get to the heart of one of the most important but most difficult to quantify aspects of contemporary corporate power.

Sales, profits, return on invested capital, earnings per share... all these may be readily quantified and understood. But reputation and standing defy such ready analysis.

What, exactly, does it mean to be admired in business?

In 1994 when Oasis were Top of the Pops and the Tories still had a few years left in power, Clive Thompson was a man who knew the answer to that question better than most. He was chief executive of our first ever winner, the gruesomely named Rentokil. Remember his City soubriquet 'Mr 20 per cent': he earned it because Rentokil had defied its municipal rat-catcher origins to deliver at least 20% annual profit growth for an amazing 10 years running. Here was living proof of the '80s dream, that nostalgia for the good old days of flag-waving Brit manufacturing was just that - nostalgia.

Who needed grubby factories hungry for huge injections of capital every few years in order to get back a measly few per cent annually? This was a company run on a lean, mean global perspective, thrifty with CapEx and focused on the bottom line, an approach that could produce reliable double-digit growth year after year. If this was the future, bring it on.

Of course, no company can defy the second law of thermodynamics for ever.

Despite this sterling performance, Rentokil was not destined to become the corporate equivalent of the perpetual motion machine and eventually the numbers began to flag. It never made it to the top of BMAC again. Look for it this year and you'll find it languishing in 117th place, mired in takeover and break-up speculation and its profits tumbling.

Thompson served as chairman until May this year, when he was unceremoniously booted out, the glory days long forgotten by shareholders who only look forward, never back. But the outsourcing sector that he helped to create has proliferated into almost every other area of business.

Two other names from the class of '94 were then among the bluest of British blue-chips, but are now relegated to undistinguished mid-table positions: Reuters and Marks & Spencer. For most of the '90s, Reuters and M&S could be found at or near the top of each year's league table. Both were pre-eminent in their field, brimming with confidence and the cachet that comes with being the best at what you do.

Many people at the top of their professions today owe their start in life to graduate jobs at one or other of these, whose reputations for training la creme de la creme in retail and journalism have not been bettered to this day.

But pride comes before a fall, and these were two of the proudest companies around. Reuters' fatal error was to assume that a market it had had to itself for the best part of 100 years would be forever immune to competition - a fallacy exposed with ruthless efficiency by US entrepreneur Michael Bloomberg, whose business not only ate Reuters' lunch but its breakfast, elevenses and dinner.

M&S's failing was hubris of a slightly different kind. Under its legendarily autocratic boss Sir Richard Greenbury, the king of the high street, it became so convinced of its own greatness that it forgot about keeping the keen competitive edge that had given it such dominance in the first place.

By 1998, a new retail order had been established, not only on the high street but also in the out-of-town shopping centres, and the age of Tesco was in full swing. Tesco is the single best performing company in the history of BMAC, winning overall a record four times (1996, 1998, 1999 and 2003) with the highest-ever winning score - 75.00 - in 1996, to boot.

Chief exec Sir Terry Leahy has also won the most admired leader award twice since it was introduced in 1999.

So although this year's result suggests that Tesco's reputational crown may be getting just a mite tarnished, the company's overall performance makes it the brightest star in the Most Admired firmament, and streets ahead of any of its direct rivals. Sainsbury's last top 10 appearance was way back in 1995.

Perhaps the greatest strength of our survey is its constancy. Still researched by its originator, Professor D Michael Brown (formerly of Loughborough University, now at Nottingham University Business School), and still working to the same rigorous methodology, the survey has grown over the years into a detailed and unique map of the rise and fall of the nation's corporate heavyweights and of the shifting priorities and concerns of business.

BMAC has even been the subject of academic study itself. New research from Stephen Brammer at the University of Bath and his associates at Cass Business School and the University of Reading suggests that the share price of some companies may rise in anticipation of the announcement of our results on 1 December every year.

Yet for all its strength, even Tesco can't compete with the tiny cadre of elite companies that have been in or around the top 10 every year since 1994. Others may come and go, shooting to brief, brilliant prominence and burning out as quickly as they arrived, but these guys are in it for the long term. Unilever, Cadbury Schweppes and the various pre-merger companies that now make up GlaxoSmithKline are the marathon runners of Most Admired. Cadbury and GSK have both been overall winners, but for these companies outright wins are less important than their consistent performances.

They have not been without their ups and downs, but this trio prove that a reputation carefully garnered by years of diligent work is robust enough to survive most short-term problems, provided they are handled well. In this kind of company, BP deserves honourable mention - not quite such a regular top 10 presence but pretty good all the same; overall winner in 2002, with Lord Browne winning the Most Admired leader poll three times.

Were we writing this in December 2003, another name would be standing alongside our quartet of long-term high performers - BP's arch-rival Shell.

Long considered a bastion of thoughtfulness and earnest endeavour, Shell battled through rows with environmentalists and global recessions only to be unseated from our top table this year by the scandal over its reported reserves.

Even the most copper-bottomed name cannot weather every storm unscathed - and disssembling, or dishonesty, is the kiss of death to reputations.

Can the company bounce back, or will it go the same way as other BMAC stars of yesteryear?


1 Rentokil 74.1

2 Glaxo 73.3

3 Marks & Spencer 72.3

4 SmithKlineBeecham 70.5

5 Unilever 69.2

6 Reuters 68.5

7 Cadbury Schweppes 68.3

8 Electrocomponents 68.2

9 Shell 67.4

10 Bowthorpe 66.4


1 Tesco 75.0

2 Argyll Group 72.7

3 Burford 69.8

4 Next 69.4

5 Marks & Spencer 69.1

6 Cadbury Schweppes 69.0

7 Reuters 68.6

8 SmithKlineBeecham 68.2

9 Siebe 68.1

10 Spirax Sarco 68.0


1 Tesco 74.5

2 Cadbury Schweppes 72.8

3 Schroders 71.2

4 BP 70.3

5 SmithKlineBeecham 70.1

6 Glaxo Wellcome 69.9

7 Unilever 68.8

8 Shell 67.6

9 Lloyds TSB 67.3

10 Boots 67.2


1 GlaxoSmithKline 73.6

2 BP Amoco 71.1

3 Shell 70.8

4 Cadbury Schweppes 70.0

5 Tesco 69.0

6 Exel 68.6

7 AstraZeneca 66.1

8 Sage Group 65.5

9 Unilever 65.1

10 GKN 65.1


1 BP 73.0

2 Cadbury Schweppes 71.3

3 Tesco 69.1

4 Unilever 69.1

5 GlaxoSmithKline 68.7

6 Shell 68.4

7 Next 67.8

8 Diageo 67.0

9 BAA 67.0

10 Wm Morrison 66.8

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