City & Corporate: Chairmen wars undermine PROs

One of the main worries about corporate governance, according to several FTSE 100 chairmen, is the increased risk of division in company boards. Their concern is that the chairman, whose job it is to manage the board, will no longer be seen as the boss for all seasons.

Governance codes map out specific responsibilities, for the senior non-executive director and the chairmen of the audit committee and the nominations committee, which potentially cut across the chairman's authority. So there are four possible centres of power even before considering the chief executive.

The division of power was always seen as likely to lead to increased conflict. One big recent story is the clash between Marks & Spencer chairman Paul Myners and Kevin Lomax, the chairman of its nominations committee, over whether Myners should stay or go. Meanwhile, BAE Systems' recently appointed chairman, Dick Olver, has been interfering too much in day-to-day business for the liking of CEO Mike Turner.

Where do such spats leave the PR executives and consultants of the companies concerned? From whom do they take guidance and what message do they give to enquiring journalists? It is all very well to say they cannot take sides and must play everything with a straight bat, but these disputes can quickly become very damaging for reputation, and giving no guidance whatsoever simply allows the story to run riot.

The M&S and BAE stories leaked because some of those concerned, or their allies, wanted to mobilise public support for their case. These people often have closer relations with journalists than the in-house PROs do, so the battles are likely to remain public. Indeed, we may well see some individuals employing their own PR counsel, at which point it could really get messy.

- Anthony Hilton is City commentator on London's Evening Standard anthony.hilton@haynet.com.

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