Business

Bury the Canaletto, now

I’m not on the guest list for the Duke of Westminster’s wedding, but I wish him luck anyway. Mind you, the young seventh duke – Hughie to his friends – hardly needs more luck than has already come his way in the form of the £10 billion Grosvenor property empire in London and elsewhere. When the playboy second duke known as ‘Bend’Or’ died in 1953, Pimlico had to be sold to pay record death duties. But the Grosvenor family has taken a firmer grip on tax planning since then, their fortune multiplying despite the dukedom passing through three cousins to reach the father of today’s incumbent, who inherited via reportedly

How to quit like the Japanese

Tokyo For many, the idea of quitting a job they hate, of walking into their boss’s office and telling him or her in no uncertain terms what they think of it (and them perhaps), and then striding out without a backward glance, is a delicious one, a pleasant daydream to be enjoyed on the dreary daily commute. But for the Japanese, the idea of resigning from your company is positively traumatic, so much so that the latest boom industry here is agencies who will take care of the whole messy business for you. For the Japanese, the idea of resigning from your company is positively traumatic There are now dozens

The truth about ‘boardroom diversity’

We all know that increasing the diversity of your boardroom increases the success of your company because politicians, business leaders and academics keep telling us so. No one has ever got into trouble for making this assertion and, in any case, we have the scientific evidence to prove it – in the form of four studies pumped out by management consultants McKinsey & Company over the past decade. The first of these, Why Diversity Matters (2015), claimed, for example, that companies in the top quartile for gender diversity were 15 per cent more likely to outperform the median company in their industry, and companies in the top quartile for racial/ethnic

China is set for a serious economic fall

 The future trajectory of the Chinese economy is a subject for doctoral theses rather than casual column items. But the advent of the Year of the Dragon, at last weekend’s Lunar New Year, was greeted with such pessimistic commentaries that the natural contrarian should ask whether the consensualists are getting it wrong: maybe the dragon is merely marking a pause before martialling its mighty resources for the next transglobal burst of fire? The negative narrative goes like this. In spite of deflation in consumer prices, Chinese shoppers are frightened of spending. Despite central bank interventions aimed at boosting asset prices, the property market is crashing after the collapse of the

Rishi Sunak can’t take the credit for falling inflation

Even the best-run companies have occasional leadership crises. But if you asked ChatGPT to come up with a blockbuster boardroom-bloodbath movie scenario, I doubt it would propose anything as extreme as this week’s events in its own San Francisco-based parent company, OpenAI. Chief executive and co-founder Sam Altman was fired last week for failing to be ‘consistently candid’ with OpenAI’s board, though no one was prepared to say what he had not been candid about. By Monday he had a new job leading AI research at Microsoft, OpenAI’s 49 per cent shareholder. One inside source claimed 743 of OpenAI’s 770 staff had signed a letter supporting him and many of

Bernard Looney shows why every board should be braced for scandal

Bernard Looney, the fallen BP chief, always had a certain swagger about him. I’ve no idea whether he was unsafe in taxis, but he was certainly prone to unguarded remarks. ‘Not every barrel of oil in the world will get produced’ was a bold way, back in 2018, to introduce BP shareholders to the idea that the world’s energy giants will one day have to strand remaining carbon assets if they really intend to achieve net-zero targets. ‘This is literally a cash machine’ was not the best way to describe BP’s profit performance in November 2021, when British households were beginning to feel the pain of soaring energy bills. And

The economy isn’t as sick as we thought

It would be churlish not to celebrate revisions from the Office for National Statistics that tell us the UK is not, after all, the post-Covid invalid of the G7. Contrary to previous figures suggesting we had struggled to regain pre-pandemic levels of economic output, it turns out that our gross domestic product passed that benchmark in late 2021 and our performance has been in line with France and ahead of Germany. Large sectoral revisions for agriculture and manufacturing tell us that statistical reporting is almost as much of a mug’s game as forecasting. But the brighter overall picture accords with the anecdotal sketch of ‘definite warming’ in consumer spending and

Let’s flush away the idea of a return to state-owned water

Water, water everywhere in the media this week, as the Thames Water utility – crippled by debt and shamed by Niagaras of raw sewage – reached the brink of collapse. Anticipating government intervention if Thames’s owners cannot inject sufficient new equity, pundits decried the 1989 privatisation of English and Welsh water – which passed from conventional shareholders to private equity and foreign sovereign wealth that combined to extract £72 billion of dividends while loading the industry with £60 billion of debt and allegedly denying it new reservoirs and leak-free pipes. Put like that, the fate of water – a resource so natural that some say it should be immune from

Rampant unions will embed high inflation

So farewell, Transpennine Express, the northern rail operator whose hapless management were no match for the Aslef union that was determined to see this underperforming franchise renationalised. TPE’s drivers, beneficiaries of the super-luxury conditions I recited last month, have effectively invented a new form of moral hazard: have no fear of crippling your employer with outrageous demands and relentless non-cooperation, because if it goes down, the government will step in and re-employ you on the same terms or better. Aslef has more strikes planned nationally for 31 May and 3 June, and the other rail union RMT – having done its best to disrupt travel to Eurovision in Liverpool –

The scourge of London’s ‘American candy’ stores

Should US regulators ban short-selling of bank stocks? That’s a hot topic as investors refuse to accept reassurance from the Fed chairman Jerome Powell that the recent banking crisis-that-wasn’t is over. Following JPMorgan’s rescue of First Republic, shares in other regional banks such as PacWest in Los Angeles, Western Alliance (Phoenix) and First Horizon (Memphis) have fluctuated wildly and fingers have pointed at short-sellers – who borrow shares they think are about to fall in order to sell, buy back cheaper and pocket a profit. That’s bad, say critics, in the broad sense that it’s a negative form of investment, the reverse of backing companies you believe in; and much

The UK’s treatment of Activision shows it is closed for business

It was, admittedly, not quite as thrilling as an action sequence from Call of Duty. Even so, the statement put out by Bobby Kotick, chief executive of US video game publisher Activision, following the UK’s bizarre decision to block the company’s acquisition by Microsoft was about as bloodthirsty as any ever put out by a major corporation. The ruling ‘contradicts the ambitions of the UK to become an attractive country to build a technology business,’ he argued. Even worse, ‘it does a disservice to UK citizens, who face increasingly dire economic prospects’, and, to cap it all off, it shows that Britain is ‘closed for business’. Of course, it would

Water woes: who’s to blame for the shortages?

For residents of the London borough of Islington whose homes were flooded this week by a burst water main, Thames Water’s decision to announce a hosepipe ban the following day must have come across as a sick joke. Just a few days before the flood, the company sent out an email asking its customers to be a ‘hot spell hero’. ‘Every drop you save really is another drop more in your local river or reservoir.’ But Thames Water seemed unable to follow its own advice: five million litres of water were lost during the leak. The episode neatly encapsulated much of what is wrong with Britain’s water industry: crude, 1940s-style

Mary Wakefield

How ‘kindness’ became big business

In those moments when I most fear that the West is on the skids, I find it helps to make a list of end-time signs, phenomena that indicate decay, like sparks along a piece of faulty wiring. So far my list goes like this: NFTs; babyccinos; liver-flavoured ice-cream for dogs; the fashion for encouraging children to cut off their genitals; the fact that Rowan Williams, former Archbishop of Canterbury, thinks it deeply wrong to talk them out of it; freak shakes; Heinz ‘pink’ sauce; gannets dead all down the North Sea coast; swearing six-year-olds still in nappies (says my teacher friend in the North-East); risking nuclear war over Ukraine; the

Why Channel 4 shouldn’t be privatised

Enough of stagflation forecasts, each more frightening than the last. Enough – for now – of energy policy sermons, as the government at last proclaims a serious nuclear plan. Instead, let’s have a week of real business stories, starting with tales of the old and new City. First, a rum do at the London Metal Exchange. The Bank of England and Financial Conduct Authority are investigating the exchange’s handling, last month, of a ‘short squeeze’ on nickel, provoked by fear of disrupted supplies from Russia. The metal’s price rocketed 250 per cent in two days to trade briefly above $100,000 a ton, reportedly leaving a Chinese tycoon called Xiang ‘Big

How to post a parcel without leaving your house

Here’s a useful tip. Go to the Royal Mail website and you can ask your postman to collect letters or parcels from your home at a cost of 60p per item. You pay for postage online, print a label and book a collection for the following day. Granted, it’s an extravagant way to merely avoid a walk to the postbox, but for special delivery items or parcels it’s a godsend. If you don’t have a printer at home, you can even get your postie to bring a label. Given that Royal Mail was founded in 1516, I’m not quite sure why it took 500 years to come up with this

Has Macron shot France’s energy industry in the foot?

Gas prices are soaring. Europe could be about to witness electricity shortages. Power companies are collapsing by the day, and, on top of all that, the government is set to phase out traditional energy to meet its net zero target.  So might think that a cable to ship in cheap, greener electricity from the other side of the Channel is something of a knight in shining armour. Yet the government blocked the proposal today, and it was absolutely right to do so. Britain may need all the electricity it can get its hands on right now — but the last thing it should do is increase its dependence on Macron and Putin. Britain

Martin Vander Weyer

The TV licence is a dead duck

‘Tell me we’re winning the media battle!’ I imagine Unilever boss Alan Jope barking at his team on Tuesday, following the revelation on Sunday of his rejected £50 billion bid for GlaxoSmithKline’s consumer healthcare arm. ‘Yes, sir,’ replies the flustered PR, ‘Very much so… except for top investor Richard Buxton of Jupiter telling the FT: “The idea of letting the goons at Unilever run [the GSK business] is laughable.” Then there’s an analyst in the Telegraph saying: “We can’t imagine many things that would unnerve us more about Unilever” than this deal going ahead. Oh, and our shares fell 7 per cent yesterday.’ Jope is now huddled with his advisers

Hunterston’s closure is the nuclear accident no one noticed

So farewell, Hunterston B, the nuclear power plant on the Firth of Clyde that shut last week after 46 years’ service. It will be followed this summer by Hinkley Point B in Somerset and in 2024 by Hartlepool and Heysham, leaving the UK with just four nuclear stations boasting five gigawatts of generating capacity between them — when they’re not suffering extended ‘outages’ for maintenance and repair. That compares with 15 stations and 13 gigawatts, meeting a quarter of UK electricity demand, at the UK’s mid-1990s nuclear peak. Meanwhile, the 3.2 gigawatt Hinkley Point C, developed by EDF of France and due on stream in 2026, ‘may be delayed after

Gastro-nomics: a foodie’s guide to a changing world

Twice recently I’ve been asked my opinion of ‘Doughnut Economics’. The first time, I was tempted to cover my ignorance with a Johnsonian impromptu riff on supply-chain issues in the deep-fried batter sector. But sensing seriousness I steered off and googled the phrase later, so I was ready the second time to discuss Kate Raworth’s 2018 book of that title, about why we should abandon pursuit of GDP growth in favour of a gentler model in which we take better care of nature and each other — illustrated by her ‘doughnut of social and planetary boundaries’. That’s a debate for another day, but what I really admire is the title

Why paying more dividends could save the planet

Climate emergency demands action, not rhetoric. So, on the eve of COP26, which UK news item promises to deliver the most positive impact for the future of the planet? Not, I suggest, Sadiq Khan’s extension of the Ultra Low Emissions Zone to the North and South Circulars, imposing stinging costs on owners of older diesels who can’t afford newer ones; nor Rishi Sunak’s £7 billion pledge for sustainable transport in cities outside London — only £1.5 billion of which turns out to be new money. No, the headline that matters more is the one that says dividend payments by UK companies are returning to normal. During the darkest days of