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Monday, 20 May, 2002, 13:20 GMT 14:20 UK
Egan roars into business leadership role
Sir John Egan
Sir John Egan: Building a better future for business?

If anyone spots Digby Jones eating out in coming days, see whether he supplements his menu selection with a sprinkling of his own words.

It was only last July that the director general of the CBI was enthusing over the election of Sir John Egan - a businessman of "experience and wisdom" - as confederation president.

"I have... followed his career with interest and admiration," Mr Jones said.

"We all look forward to working with him."

On Monday, the day before Sir John took office, it became apparent that what Mr Jones could actually look forward to was euro-furore, union hostility, and shredded political relationships.

'Bandit territory'

After a succession of mealy-mouthed CBI presidents, content to simmer on the back burner, Sir John, a former Jaguar boss, has roared his desire for the heat of battle.

Sir John Egan - profile
1969: Engineering degree, Imperial College London
1966-68: Petroleum engineer, Shell
1962-66: General Motors
1968-71: British Leyland
1976-80: Director, Massey Ferguson
1980-90: Chief executive, Jaguar
2000- present: Chairman, Inchcape

Mr Jones had every reason to splutter into his Fruit and Fibre on Monday on discovering not only that the CBI had made headlines in all Britain's major national papers, but over issues ranging from NHS investment to the funding of political parties.

Sir John was quoted as warning that the healthcare spending increases announced in last month's Budget - a "mugging" - would prove inflationary.

The government was "in bandit territory", he told The Guardian newspaper.

While his predecessors have been haunted by the "curse of the CBI", Sir John appeared hell bent on damning the organisation itself.

Euro dispute

Sir John attacked the government for "savaging shareholders" by raising taxes on North Sea oil firms, and urged state funding for political parties.

The "curse of the CBI"
Executives elected CBI president have often found their own business interests suffer.
2000-02, Sir Iain Vallance: Quits BT, after shares plummet amid debt fears.
1998-00, Sir Clive Thomson: Rentokil misses 20% growth target for first time in 17 years.
1996-98, Colin Marshall: British Airways shares slide by a third. Cabin crew strike. Tails fins row.

But it was Sir John's scepticism towards the euro which prompted the most comment, as he warned over the unknown effects on the City of scrapping the pound, and of the continuing economic malaise besetting the eurozone's biggest economy, Germany.

"The Germans weren't in the doldrums for as long as this when they were running the economy themselves, so we must assume the euro is not acting in their best interests," Sir John told The Independent.

Such analysis followed months of painstaking work by Mr Jones to reposition the CBI as euro-neutral, after his predecessor Adair Turner steered a pro-single currency tack.

Turnaround man

Was this work to be undone by a president who works the equivalent of one day week?

Des Wilson in 1990, as a Liberal Democrat officer
Des Wilson: Campaigning history

The talks over greater co-operation with unions, the swallowing of crustaceans by the trawler-load during Labour's prawn cocktail offensive - was all this negotiation and ingestion in vain?

CBI members must have known what they were in for when they elected him.

And Sir John, after all, has a history of turning around moribund organisations, often employing unconventional strategies to do so.

That the Jaguar brand adorns any cars built after 1980 is largely down to his tenacity in turning round a firm which seemed to have been directed by the British Leyland fiasco down a one-way street oblivion.

A carmaker worth 300m when Sir John took over was sold a decade later for 1.6bn to Ford.

At BAA, he oversaw the rebirth of a staid, publicly owned utility as a dynamic, globally oriented plc.

While others failed to see the opportunities lying beyond the check-in desk, Sir John realised that airports attracting large numbers of high-earning travellers, and making them wait hours for flights, presented retail opportunities.

And when he realised that plans for a fifth terminal at Heathrow airport would prove hugely controversial, Sir John hired not an oily City palm-squeezer but a well known environmental campaigner - Des Wilson - to head BAA public relations.

Sheep in wolf's clothing?

Indeed, all may not be as it seems with Sir John slating the Labour government's recent record.

Certainly Sir John may owe his knighthood to a Conservative leader, Margaret Thatcher, and he may proclaim euroscepticism.

But a Europhobe? Sir John, who spent a year in Italy with Massey-Ferguson, speaks Italian and has a house in the Alps, does not fit the classic little Englander mould.

And while he may appear an unreconstructed Thatcherite Tory, Sir John espouses the New Labour priority of responsible corporate governance.

He was appointed by the Labour government in 1997 to head the Construction Task Force.

And one the pillars of his revival of Jaguar was the thoroughly Blairite act of promoting the educational standards of employees. (Besides, that is, reducing their number).

Sir John viewed the presence of only 78 graduates at the firm, within a 10,000-strong (later 8,000-strong) workforce, as one of the most telling features behind Jaguar's decline.

Indeed, he credits his own success largely down to having parents who were "stormers for education".

Double act

So if the battle lines really are being redrawn between business and Labour, it is a sophisticated conflict which is afoot.

Certainly Mr Jones will, judging by the wreckage left on Monday, need to hone his damage limitation skills during Sir John's presidency.

But what Mr Jones may have gained in Sir John is a negotiating foil - the hard man to complement his generally reasoned approach.

The bullish George Bush to partner his peacemaking Colin Powell act.

Does Sir John's appointment represent "hurray" or disarray for the CBI?

Observe, if you spot Mr Jones at mealtime, whether he is wearing a word-eating grimace, or the smile of a fattish cat who got the cream.

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See also:

20 May 02 | Business
06 Nov 01 | Business
30 Aug 00 | Business
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