Rose engineers smooth departure from Rolls-Royce

Rolls-Royce CEO Sir John Rose will step down next spring. He's earned a drop in revs...

by MT Staff
Last Updated: 19 Aug 2013
One of UK plc's leading lights is retiring: Sir John Rose, CEO of Rolls-Royce since 1996, has announced that he will step down from the UK-based engine maker at the end of March 2011. Announcing his departure today, Rolls-Royce paid tribute to his 'leadership, strategic vision and tenacity'. And for once, that's not a case of rose-tinted glasses.

Indeed, Rolls' CEO has a rep as one of the most effective leaders on the UK business scene, having transformed the company from a stalwart of British industry into a truly global player. When he climbed into the pilot's seat, Rolls had revenues of £3.6bn and profits of £175m.
Rose helped drive a nearly three-fold increase in sales, to £10.1bn in 2009, while profits soared to £915m last year. And Rolls also credits Rose with creating a platform for the company to double revenues in the next 10 years too. Just the level of horsepower we like.

Rose can also take credit for the company's performance in the wake of 9/11. While the global airline industry - Rolls' biggest customer - went into a nosedive, Rose was busy diversifying into defence aviation (the company now counts the US Defense Department as its biggest customer), marine propulsion and, with the £576m purchase of Vickers in 1998, the energy sector. At the same time he built up a crucial presence in after-sales support (a nice repeating revenue stream), and proved the size of his pistons by doggedly standing by his investment in the fuel-efficient Trent engines - despite its lack of shareholder-friendly short-term profits.

Rose will pass the executive spanner to John Rishton, currently CEO of the Dutch retail group Royal Ahold (and former CFO of BA). But then what? He's the latest in a string of high-profile CEOs to step down lately: BP's Tony Hayward, Barclays' John Varley, Lloyds' Eric Daniels, HSBC's Michael Geoghegan... Meanwhile Sir John Parker is supposedly lining up an exit from the chair of National Grid towards the back end of 2011, and Vodafone chairman Sir John Bond could be disconnecting within the year too. So there's a few jobs going (the Sunday Times has actually linked Rose to Bond's job, in fact).

But with governance demands getting ever stricter, and the consequences of failure more marked, we wouldn't blame Rose if he left corporate airspace altogether and just left his engine ticking over quietly instead.

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