Business

The Institute of Directors requires a quality judge

More City than Soviet – inverting Sir Ken Olisa’s oft-used phrase (coined when describing the governance shenanigans at Kazakh miner ENRC) might seem a little hard on the poor old Institute of Directors (IoD).

But how else to describe an organisation where the chair is covertly recorded by the director-general, is the subject of a litany of allegations about her conduct, and a cabal of directors is on the brink of resigning?

The charge-sheet against Lady Barbara Judge, the IoD’s chairman since 2015, doesn’t look pretty.

Many of the allegations against her – using racist language, bullying behaviour and using IoD resources to promote her private interests – would, if upheld, be resignation matters in isolation.

Yesterday, Stephen Martin, the director-general, told members that the IoD took the allegations against unnamed board members extremely seriously.

Yet at least one of those allegations, that a purportedly private conversation involving Lady Judge was secretly recorded, relates to his own behaviour.

Read more: Institute of Directors chair "steps aside" after misconduct allegations

That means, at the very least, that a heavyweight figure with a strong track record on corporate governance reform will be required to restore credibility when Lady Judge’s successor is appointed.

It’s hard to see how the IoD can opine on the corporate governance standards of major companies with its Pall Mall headquarters in a state of abject disorder.

And such a crisis could hardly have come at a worse time, with the organisation’s finances not exactly in rude health.

It may not be an overstatement to suggest that the handling of this crisis will be make-or-break for the IoD.

London risks IPO snub

What links Aston Martin, Farfetch and Saudi Aramco? The answer, currently, is not much. But in a few months, they could all fall into the category of multi-billion pound companies snubbing London in favour of a New York listing.

Whoever succeeds Xavier Rolet at the helm of the London Stock Exchange Group (LSE) will have some instant marketing to do. All three of these would-be public stocks could conceivably content themselves with a UK listing.

The signs, though, are not positive: Farfetch already appears to have plumped for the companionship of its technology peer group on New York’s two stock exchanges.

Meanwhile, the controlling shareholders in Aston Martin might reasonably argue that emulating rival Ferrari’s luxury goods valuation will only be possible if the car maker goes public in the same place.

Read more: City watchdog seeks to reassure big investors on Saudi Aramco float

As for Aramco, this week’s visit to London by Mohammed bin Salman, the Saudi Crown Prince, offered a chance for City chiefs to make the case for the country’s state-owned oil giant to eschew the political risks of New York. The outcome remains opaque.

The LSE’s business is, of course, about far more than the prestige of the international companies which list on its principal equity market.

Nevertheless, a decision by three such prominent businesses to consider, then reject, London will inevitably accentuate Brexit-related jitters.

Hayward seals deal

Tony Hayward has ticked a lot of boxes since getting his life back more than seven years ago.

Since leaving BP in the wake of the Macondo oil spill, he has joined, and stepped down from, the board of its Russian joint venture; floated a resources company on the London Stock Exchange (with limited success); and taken the helm of Glencore, where he has helped steer it back from a near-death experience.

Read more: BP: Oil demand to peak by late 2030s as electric vehicles jolt the sector

Now, Hayward is back on the deal trail. I understand he, alongside the buyout giant Carlyle, has signed a deal to acquire a Colombian oil asset. Both parties are coy about the terms of the transaction, but it’s said to be worth tens of millions of dollars, and will be the first leg of a new buy-and-build platform.

The performance of Genel Energy, listed by Hayward and Nat Rothschild in 2011, will make an eventual exit via the stock market for his latest venture a tough assignment to pull off.

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