John McFarlane has a fearsome reputation for shaking up companies soon after he joins them.
Barclays said Antony Jenkins’ abrupt departure as chief executive was triggered by non-executives agreeing that his time was up. But McFarlane’s arrival as chairman less than two months ago surely played a part.
The veteran banker helped oust Andrew Moss as Aviva’s chief executive in May 2012 after a shareholder revolt over pay and financial performance. There, too, he became stand-in executive chairman, running the insurer for eight months, reining in costs and redrawing its strategy.
McFarlane was named as Barclays’ chairman in September 2014, having vehemently denied any interest in the job. He took over from Sir David Walker, who spent three years as chairman, at the bank’s annual meeting in April and is paid £800,000 a year.
At the meeting, disgruntled shareholders called for McFarlane to repeat his shakeup of Aviva at Barclays. One shareholder told the board that only two directors were left at Aviva after McFarlane “arrived at Aviva with his axe”. Another said he was looking forward to McFarlane wielding his chainsaw at Barclays.
McFarlane sat impassively throughout but he issued an unusual letter to investors suggesting that protesters at the meeting might get their way. Barclays was changing too slowly, costs were too high, businesses might need to be closed and the bank needed to settle disputes with regulators, he said.
“While substantial progress has been achieved … it is transparent that a great deal still needs to be done,” he said.
McFarlane also played a part in the ejection of Fred Goodwin as chief executive of Royal Bank of Scotland. He became a director of RBS in October 2008 – two weeks before the bank’s rescue by taxpayers. McFarlane later said he was “slightly instrumental in the change of the chief executive” at RBS.
He was tipped to become RBS’s chairman but the job went to Sir Philip Hampton. McFarlane stayed on as a non-executive director of RBS until he became Aviva chairman in 2012.
McFarlane has chaired the Scottish-based bus and train operator FirstGroup since January. Soon after arriving he cleared out half of the company’s board and quashed hopes of a resumption of dividend payments at the indebted company.
Tim O’Toole, FirstGroup’s chief executive, was under pressure when McFarlane arrived but has survived in the job. McFarlane will leave FirstGroup in July, having taken the Barclays job.
The Scottish-born banker is best known in Australian banking circles after running ANZ – Australia and New Zealand Banking Group – for a decade until September 2007.
He turned the bank into one of the region’s most respected companies by focusing on retail banking, cutting investment banking and expanding in China. Before ANZ he was an executive director at Standard Chartered, the Asia-focused UK bank, and headed Citibank’s UK and Ireland business.
McFarlane started his business career in manufacturing at Ford’s European operation in 1969. He moved back to the UK from Australia in 2012 to chair Aviva. Outside of his business career, he has played in a skiffle band called the Sekrets and now grows olives in Provence.
A reputation for cost control and a willingness to oust chief executives have led some UK journalists to label him Mack the Knife. McFarlane said on Wednesday he did not recognise the nickname and that cost cuts were only part of his work at Aviva.
“Tripling the market cap and doubling the stock price isn’t about knives its about accelerating”. He said slashing costs had not been a hallmarkt of his 40-year-career but he said: “I am decisive and that’s fair enough … Look at my track record: it’s largely about process not just about cost.”
In Australia, newspapers called him Johnny Hollywood in honour of his performing past and willingness to sing songs such as House of the Rising Sun at corporate and charity events.
This article was written by Sean Farrell, for theguardian.com on Wednesday 8th July 2015 10.21 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010