With the threat of internecine warfare over Europe brewing, the CBI is proving to be a much tougher posting than its ambitious young director general may have been expecting.
Try to imagine what it must be like running the Confederation of British Industry right now. First, you have to deal with a Labour government which is so keen to work closely with business that many of your members are in severe culture shock. Second, you have to sort out your relations with a Conservative party that seems to have totally lost touch with its natural constituencies. On top of which, you have to negotiate your way round a national issue of extreme political sensitivity where the views of your members are completely at odds with those of a number of leading newspapers - not to mention some public opinion. Then up pops a small but vocal minority to claim that the organisation itself has been hijacked by big multinationals. Suddenly the public arena, for so long a calm sea with clearly marked hazards which the CBI had patiently navigated, has become very rough water. Diplomacy, a bit of guile and a firm hand on the tiller are what's called for, and a few people are beginning to ask, has the current director general got what it takes?
'Yes' is the answer from most of the senior businessmen at the top of the CBI, who have formed a tight defensive circle around Adair Turner following the rows over Europe this winter. It is two and a bit years since the 42-year-old ex-McKinsey partner took over from Howard Davies as CBI director general and in that time, they point out, he has performed admirably at the employers' organisation: streamlining staff, reorganising the London head office, and sensitively negotiating the potential minefield of last year's general election. So who's complaining? The problem, it seems, is that Turner does not have quite the same mastery of the media as his predecessor, and now faces far tougher difficulties than confronted Davies. Then there is the problem of his manner. Too smooth, too arrogant, too ambitious, too cocky - Turner, a tall, slim, handsome man, has provoked a variety of views among those who have met him, not all complimentary.
These would be minor quibbles in so able a manager, but with the row over the CBI's support for Britain's entry into a European currency unlikely to go away, the director general is going to need every last ounce of media savvy he can muster. Otherwise a healthy debate is going to be depicted as a cavernous split, and the organisation, and Turner, will get shredded.
Is this fair? Sitting at the conference table in his 10th-floor Centre Point office, Turner appears anything but confident. After the rows at the CBI's annual conference in November, with Sir Stanley Kalms, chairman of Dixons, loudly proclaiming that the organisation is no longer representing its members' views properly, the previously plum job of director general has taken on a distinct tinge of after-you-Claude. Davies, safely ensconced at the new super-agency regulating Britain's financial affairs, could be forgiven for feeling rather pleased with himself these days. It was Davies, another ex-McKinsey man and CBI director general for just three years, who recommended his old friend for the post back in 1995. Looking at the problems Turner now faces, the favour could turn out to be something of a hospital pass.
So, given that Turner has spent most of his working life avoiding publicity at a notoriously tight-lipped management consultancy, it is perhaps not surprising that press interviews appear to make him rather uneasy. Perched on the edge of his seat, arms tightly crossed, a little frown playing over his neat, executive good looks, he seems uncertain how to approach our meeting. He looks at his watch. He defers to his press officer. He jiggles about a bit nervously. Does he still find dealing with the media difficult? It is not, he says after some thought, something that comes naturally to him. The process of communicating what the CBI is doing - which is a small but vital part of the director general's job - has proved rather tougher than he expected. For instance? Well, he says, on a trivial level, just producing those 20-second soundbites that broadcast news programmes love so much can seem an impossible task.
'Being the classic McKinsey person, I believe in the power of fact-based argument. That shouldn't mean you go on and on at great length but it does mean that if you are going to make a statement you would like to be given two minutes and be able to develop a beginning and an end,' he sighs. But didn't Davies warn him of what it would be like? 'Howard told me that dealing with the media was an immensely intricate skill and if I worked very hard at it I might be as good as him at it,' he says, and he laughs a bit derisively. He means it affectionately but ouch, you think, no wonder Turner can put noses out of joint. While scrupulously polite and charming, he does occasionally make you feel that communication with lesser mortals is not the sort of thing that clever people, like those at McKinsey, would ever set much store by. And, over the course of an interview, he does like to remind you of just how successful he was at McKinsey, how much money he gave up to come to the CBI, and how jolly clever he really is. This sharp-young-consultant manner has tweaked a few egos. 'Let's put it this way,' says Kalms, who has been unimpressed with the way Turner has handled the European issue, 'I don't think he got his double-first in diplomacy.'
He wasn't hired, however, to win any media beauty contests on the basis of personality. When he joined the 250,000-member CBI in 1995, he took over an organisation that had changed radically over the past decade.
Under Howard Davies and his predecessor Sir John Banham, the CBI was transformed from what was seen as a 'whinge-on-request' body into a sophisticated, proactive lobbyist on business' behalf, pushing out well-researched initiatives on a range of issues and, incidentally, gaining a high public profile for its director generals. Turner, with considerable experience working for McKinsey clients in telecommunications, brewing and aggregates, fitted the bill as Davies' successor: he had been close enough to those involved in running business to understand their needs, and came heavily recommended by those who had dealt with him. He was also young - a useful counterbalance to the CBI president, who is always a senior businessman - bright and ambitious.
'He was a comer,' says Sir Bryan Nicholson, chairman of BUPA and president when Turner was selected. Most important, adds Davies, Turner brought with him a disciplined, analytical approach to issues, which is essential to a body like the CBI. 'There is a lot of emotion and politics involved, and the person at the centre of it must be seen to be approaching issues from an analytical point of view.' Yet, as was remarked upon at the time, he was the first CBI leader to have had no experience of a public position (both Davies and Banham headed the Audit Commission before decamping to Centre Point). And two years later it is Turner's very analytical rigour - his inability to brook any opposition to what he sees as a logical business position - that has so enraged the Eurosceptics.
Kalms' claim that the organisation has been hijacked by big company opinion in its rush to endorse EMU has clearly opened a wound. Kalms' argument goes as follows: around 90% of the CBI's members are small and medium-sized businesses with fewer than 200 employees. Most of them are as yet undecided on the advantages of joining EMU. The string of CBI surveys on the issue, typically involving just hundreds of members at a time, are not representative of the full range of opinion. Worse, people at the top of the organisation have simply decided that Europe is good and tried to drag the membership with them. If the CBI doesn't get back in touch with its grass roots, Kalms concludes, it will lose credibility, first with its members and then with the people it seeks to influence.
It is stiff criticism from a senior businessman and a CBI council member at that. Others on the council, who are clearly furious that Kalms has determinedly courted the press on this issue, point out that he stands absolutely alone. 'Where is Stanley's support?' hisses one ex-CBI executive.
'Where are all the businesses backing him? There aren't any!' But it resolutely turns up the heat on Turner who, you suspect, is rather unused to being criticised in public. He digs his heels in. 'Our position was set out in July,' he says. 'It followed an intensive process of consultation, which involved meetings with hundreds of members. We said then that in principle we would like Britain to be a member of a successful monetary union, that several conditions apply to going ahead with convergence fiscally, and that Britain has to join at the right point in the cycle and at the right exchange rate. It is partly when, and partly if; but in principle, the desired end is that there will be successful monetary union and we should be part of it.' Some of his members, he adds with a smile, are more 'if' than 'when'.
Yet the danger is that all this, stoked by newspapers which have their own axes to grind, could quickly escalate into a vicious internal war inside the CBI. However much Turner points out that the surveys of opinion on Europe have been scrupulously fair, that other surveys by bodies like the British Chambers of Commerce show similar results, and that debate has been encouraged - Kalms was even given the platform to put his views to the annual conference in November - the issue is likely to remain front-page news right up to the next general election. It needs careful handling.
Kalms himself stresses he has no criticism of Turner's management abilities, his disagreement is simply one of philosophy. 'I think Adair, like many bright men, has become so convinced of his view that he is determined to persuade everyone of the benefit of EMU, rather than allowing himself to keep listening to the arguments,' says Kalms. Indeed, one of the reasons Turner was selected as director general, suggests Kalms darkly, is that he perfectly reflected the views of senior businessmen like Sir Bryan Nicholson.
'And Bryan,' says Kalms, 'is a frightful Europhile.' Nicholson, for his part, says it is all 'such balls'.
Will the rows ever subside? Turner sighs. 'The only thing predictable in British public life is that Europe never goes away,' he says. If there was ever a national referendum, would the CBI campaign openly? Turner chooses his words carefully: 'If the vast majority of members believed the proposition was sensible, then there is at least the possiblity that the CBI will institutionally support the Yes vote as it did in 1975, when it argued we should stay in Europe.' How big a majority would it need?
'Well,' he says, 'if it's 60-40, then we cannot do it. When we get to a referendum then we will have to decide.'
Would he describe himself as a Europhile? 'I do drive Eurosceptics mad by telling them that I have no problem about saying to my children that they have European passports,' he laughs. In fact, he adds, his children actually have Irish passports, as his wife Orna, who is also a management consultant and a partner at McKinsey, is Irish. Turner himself was brought up by English parents in Scotland, and can switch his accent from fluent public school English to convincing Glaswegian with surprising dexterity.
'I think of myself as having a mix of English and Scottish roots, being essentially British but also European. I don't have a problem with that multi-faceted identity. That is the nature of identity. I am deeply suspicious of people who feel the need to define themselves as exclusively English or Scottish.' Yet, of course, to his detractors Turner appears the epitome of the modern, ambitious Eurocentric executive keen to push Britain in to closer links with the Continent simply because of the business logic.
Turner retorts that he can only represent the views of his membership - the problem, perhaps, is that director generals in the past have always been encouraged to interpret that brief rather loosely, and Turner is now paying the price for it. But he wouldn't have taken the CBI job if he had been battle-shy. After all, as he points out, he was earning a fine living at McKinsey. He didn't have to move. He really wanted the job.
He says that business and economics have always fascinated him - he can remember, aged 10, watching the news and wondering: what is this thing called the balance of payments? Brought up in the new towns of Crawley and East Kilbride - his father was a town planner and local government officer - he was educated first at grammar school and then at an expensive Scottish boarding school. He has an elder brother who is an engineer and a younger sister who is a vet, both living in Scotland.
He also has a younger brother who lives in Africa and does charity work, who, he says, is the complete opposite of him. 'I like to think he is my alter ego,' he says.
'If you get two lives, I will get his, just totally different.'
Turner has, it seems, always been ambitious for success of one sort or another, a factor perhaps, in his early decision to be known as Adair (his second name) rather than the more mundane Jonathan (his first). At Cambridge University he climbed the traditional ladders, becoming president of the union and chair of the Conservative Association, the sort of positions that normally guarantee a glittering political career. He clearly caught the bug: he remembers with affection addressing a student union meeting following the Portuguese revolution, putting forward a motion welcoming multi-party democracy, while 200 hard-line Marxists chanted 'Bourgeois!
Bourgeois!' at him - good training, you feel, for anything Kalms can throw at him. But somehow those ambitions got deflected. He left the Conservative party, flirted with the SDP after university, and now claims to be broadly apolitical.
On the work front, he tried oil and banking before plumping for McKinsey.
He lasted six months at BP before finding it too dull and followed some friends to Chase Manhattan. He wanted to earn a lot of money, he says, and it removed the need to go to business school. But he always knew he didn't want to be a banker and three years later he joined McKinsey. He stayed 13 years, working for a variety of clients and with a string of now-famous colleagues, such as William Hague and Archie Norman. He loved it, he says, although after 10 years he had got 'a bit bored' again so he moved on to building up McKinsey's practice in Eastern Europe. When Davies, an old friend, mentioned the possibility of joining the short-list for the CBI job, he jumped at the chance. As both Davies and Banham, now chairman of Tarmac, have proved, running the CBI can be an invaluable career boost.
Did he find the switch difficult? No, says Turner, apart from dealing with the media, most of the skills which he had picked up at McKinsey were pretty relevant to the CBI. Such as? 'Well,' he says, tapping a thick wad of paper stacked up on the corner of his desk, 'the ability to pick up something from here, from an expert on competition law, for example, to understand it, to say: "You haven't sorted out this, this, and this", in other words, the speedy ability to absorb an intellectual case and critique it.' Those who work with him say his management skills are excellent; in particular the internal changes he has brought to the CBI, carrying on where Davies left off, have been well thought out. 'He has reduced staffing levels by about 20%, he is in the process of restructuring our lease, allowing us to re-accommodate ourselves elsewhere in Centre Point, and he is getting us the most modern technology,' says Sir Colin Marshall, chairman of British Airways and current president of the CBI. 'He really is doing a first-rate job.'
Turner himself talks about 'the new CBI', soon to be shifted into open-plan offices on the lower floors of Centre Point, re-equipped for the next century. 'The opening of the new layout will be the most visible manifestation of that. It's the interesting thing about this job: as a public policy vehicle the CBI has a lot to do with big business, but for 25% of the time you are actually chief executive of a middle-sized business, with 250 employees and £17million turnover.' Once the new office is up and running, what he would really like to do, he says, is change the organisation's name. 'There is just an ambivalence with the word "industry". People think it only means manufacturing. While that's very important to us, it is also important that we are understood to represent service industries and others as well.' What would he call the organisation? 'Probably the Confederation of British Business,' he says with a smile, 'but it turns out that is rather difficult to arrange. We might do it some time.'
Before then he has more pressing concerns such as influencing the detail of the labour market initiatives introduced by the Government: the social chapter, the minimum wage, trade union recognition. Despite opposing such initiatives before the general election, Turner says the CBI is sanguine about their imposition. 'The US has both the minimum wage and a form of trade union recognition, so it is not possible for a logical person to argue that vibrant capitalism is totally incompatible with the existence of either,' he says. The CBI's task now, he says, is to get the details right. On the minimum wage, it has indicated that anything much above £3.20 per hour will, in its opinion, adversely effect employment. The trade unions, of course, want £4-plus. A figure is being hammered out by a nine-member commission, which includes the CBI's head of human resources.
So what will they end up with? 'I don't know,' says Turner. Does he have a hunch? Turner seems as if he is about to tell me, then he looks at his press officer who says firmly, no, not even off the record. 'He's dictatorial,' says Turner, apologising and smiling weakly.
Finally, what about his own plans? Turner already has the material wealth that many business leaders take 50 years to amass - the big house in Kensington, the country house in the north Hampshire Downs - so will he move back to consultancy after his five-year stint at the CBI? He might, he says, but first he will take some time off to see a bit more of his two daughters before they get too old. Oh, and he is also going to write a book on globalisation, economics and politics. 'It's a sort of Will Hutton State We Are In-type book,' he says, looking rather nervous. 'I am already talking to publishers.'
Politics won't tempt him again, now he has a public profile? 'I don't think so,' he says. 'I don't think I would enjoy staying in any party where you had to stick to a rigid set of policies on a range of items.' Well, no problem about rejoining the Conservatives then? For a moment he looks confused then he gets the joke. 'Ah yes, I see what you mean,' he says, with a little laugh, as if not quite sure whether such a gesture is acceptable or not. Then he says my time is up. Being director general of the CBI is, I suspect, quite time-consuming at the moment.
Born 5 October, Ipswich
Educated Trinity College Glenalmond and Gonville and Caius, Cambridge University
Graduate trainee, BP
Associate, McKinsey & Co
Director general, Confederation of British Industry
What People Say
'Of the three CBI director generals I have known Adair is probably the most cerebral. He may not be as assured with the media as Howard Davies but that is judging him against someone who was absolutely outstanding.'
Sir Bryan Nicholson, chairman of BUPA 'I think Adair, like many bright men, has become so convinced of his view that he is determined to persuade everyone of the benefit of EMU, rather than allowing himself to keep listening to the arguments.' Sir Stanley Kalms, chairman of Dixons
'Adair is a very decent man and I think the CBI is very lucky to have him. It is easy to snipe or carp about the rows over Europe, but what we should be doing is having a healthy debate.' Sir John Banham, chairman of Tarmac 'Adair is first-rate. He certainly believes in his own convictions, but he puts them over in a non-confrontational way.' Sir Colin Marshall, chairman of British Airways and president of the CBI
'I think Adair starts with a great advantage. He has got an extremely good manner and a good working method. He has got McKinsey's training, and the more you work with people who haven't got that, the more you appreciate it.' Howard Davies, chairman of the Financial Services Authority.