Autumn 2012 www.iodscotland.com
Published for members of the Institute of Directors in Scotland
Bus builder has global ambition pg 18-19
Find your role in our economic future IoD Scotland Conference Cameron House on Loch Lomond Friday, November 2 pg 10-13
Enjoyed your break? Good, now it’s back to work Encouraging signs: Despite the harsh economic climate, IoD mnembership has held up well in Scotland, says chairman Ian McKay
“Thank you, yes, I did have a nice holiday”. We’re at that time of the year. Projects and dilemmas were put on hold for a while as people remembered we are all human beings and went off to exotic or less exotic climes for a while. I suspect this year there might have been more of the latter than the former. There is an understandable tendency to run away from the recession and what it has meant for so many businesses across Scotland, but there is still that healthy Scottish attitude which remembers that while running away might be nice, you’ve still got to come back to face it. Travelling in foreign lands does stimulate making comparisons. For me, my trip involved taking a ferry and driving down the west coast of France, then back up to the east coast and through the Tunnel home. From all of that I am left with a hardened belief that infrastructure matters. Travelling up lovely little N-roads in France reminds you how important keeping a good environment is to things like tourism and the related service industries. In many ways, I think Scotland can compete on that front. But the big difference emerges when you have finished dillydallying and want to move on. The availability of new, good and fast motorways allows you to press ahead to where you need to be. They outstrip anything we have in Scotland. They are, of course, also in the main part peage. That couple of hundred
direct miles at fast pace will cost you £6 or £7. I confess I never thought twice about paying it or feeling it was anything other than a bargain. I always had the choice of the main trunk routes for free, and sometimes took them, but the ‘pay for better’ deal was well worth it and the resultant difference in available infrastructure was massive. In Scotland, unfortunately, we don’t have that choice. Membership of the IoD in Scotland has bucked the trend in holding up over the summer period and we have actually continued to grow. A big thank you to returning members and hello to those who have just joined. It has been a lot of hard work to keep this up during the downturn. We’ve taken a leaf out of the book of our prudent members with their own customers – what do members want, are we delivering it, are our prices acceptable, are our costs under control? But this time we have gone further and drilled down to get detailed information from continuing members, joiners and leavers alike. They tell us they value the chance to talk to their peers at our events – they know that everyone there will be worth talking to. They want a range of interesting events – and are even prepared to pay for them if they think they are getting value. They want the caché of IoD membership and they want the access to key stakeholders that membership brings. Keeping our membership healthy and high is good business for everyone, and it often just comes down to asking someone if they are a member – and if not, why not? We’re going to keep on trying hard to give members a great experience within IoD and we hope you can join us in that. For many members it is an essential part of their networking strategy and personal development. So wise up – you’ve had your holiday – time to get back to work.
Contacts & details Executive Director: David Watt email@example.com Web www.iodscotland.com or www.iod.com/scotland
IoD Scotland is the official membership magazine of the Institute of Directors and is published on its behalf by: Chamber Media Services, 4 West Park Road, Bramhall, Stockport, Cheshire SK7 3JX.
Address IoD Scotland: 29 Abercromby Place, Edinburgh EH3 6QE
Advertising sales: Colin Regan t: 01925 468403 e: firstname.lastname@example.org
For email enquiries, email@example.com
Tel. 0131 557 5488 Fax. 0131 557 5818
Production: Rob Beswick t: 0161 426 7957 e: firstname.lastname@example.org
Although every effort is made to ensure the accuracy of material contained within this magazine, neither IoD Scotland nor Chamber Media Services can accept any responsibility for omissions or inaccuracies in its editorial or advertising content. The views expressed in this publication are not necessarily those of the IoD. The carriage of advertisements or editorials in this publication does not constitute an endorsement of the products or services advertised. Cover picture: Join us at the IoD Scotland Conference at Cameron House on Loch Lomond and find your place in the great recovery... as typified by the success of Alexander Dennis Ltd (inset picture)
IoD Scotland Autumn 2012 | 03
Executive director’s view Politicians keen to change the constitution must not lose sight of the current and future economic picture, says IoD Scotland’s David Watt
HERE is a great deal of debate currently about the economy in an Independent Scotland and yet there is a real danger that the debate itself is masking some enormous challenges we face in Scotland, regardless of the constitutional format we eventually choose. Of course, the debate on the constitution is potentially life-changing for the nation and its people, and ultimately could change our place in the world and impact on all our lives. This is enormously negative or enormously positive depending on your view, but it can be argued that many of the effects will be longer term and some feel that in a globalised society, independence is more of a brand than an earth-shattering, all-changing status. The one real issue for those in the business community is what would be the state of the economy in the future – short, medium and long-term? What effect would staying in the Union have – and what impact would independence have? What opportunities will arise from either system at a time that is looking pretty grim? The key concern right now is the economy – now and in the medium and longer term. Many believe that we need to alter the balance of our economy away from the public sector to the private or the third sector, where social enterprises grow and thrive. There is a real need for the focus of our economic activity to be on wealth creation and not on spending if our economy is to be lifted out of recession now and in the future. Scotland has to grow its international aspirations and restore its historical entrepreneurial culture if it is to thrive and survive in the global marketplace – regardless of its constitutional state. This needs our full attention right now and requires all of us – politicians and business people, educators and civil servants – to decide what to do and do it as soon as possible. The time for action is now and we mustn’t delay. There are many good examples of what can be done,
The economy counts for more than a change in constitution such as the additional £1million for the Prince’s Scottish Youth Business Trust announced recently, and the changes in the education system through Curriculum for Excellence which could help change attitudes and focus on an educational system that is for life and work and is of interest and stimulating to all. There is also the private sector focus on renewables, while the foreign inward investment in this area proves we can lead the world in R&D in 21st century industries. Alexander Dennis expanding into Australia in bus manufacture illustrates where we can be and we do have top companies coming in here as well – such as Mitsubishi and Gamesa. We do need to develop our own companies though and keep them headquartered in Scotland. These need not be big companies – you can devise games businesses with our sophisticated technology with worldwide impact on a small scale and succeed internationally. We must do more of that. We can only solve our economic problems by bringing in more money from outside – not just circulating our own around more often. It is simply not satisfactory to have our exports at a
IoD is on hand to help solve your business problems
he summer months are a quieter time for the Scottish and UK Government activity with the Parliaments being in recess and the Civil Service off on holiday in significant numbers. This means we have had fewer demands for responses on consultations and fewer meetings to discuss their policy development. We have, however, had many other encounters including a recent meeting with RBS to hear of their business plans and their positive focus. We should emphasise that if you have issues with them or any other bank we, in IoD Scotland, might be able to open some doors to further higher level discussion if that is helpful.
04 | IoD Scotland Autumn 2012
We have positive relationships with all of the major banks and on-going offers to come to them with concerns or difficulties – and we do – so if you are having problems with any bank then we are here to help. That is just one example of what the IoD in Scotland can do for you – we can open doors and make contacts. We are not primarily a networking organisation but we do have networks which can assist you in doing business and making contacts at the appropriate level. Right now we all need as few barriers to business as possible and if we can help reduce them for you we are more than happy to help. Remember, that is why we are here.
Executive director’s view | Awards 2012 “Right now we all need as few barriers to business as possible and if we can help reduce them for you we are more than happy to help. Remember, that is why we are here...” level which is less than a fifth of that of Ireland (£25m against £135m), a country which is smaller than Scotland in population terms. There are sizeable parts of the world not in recession and we must get our products and services into them as a matter of urgent priority. We need to spend public money where it produces the most added benefit – on infrastructure – and stop spending it on unsustainable universal benefits. Coupled with moving the public sector to a facilitator from a more expensive deliverer, this will see a real change in our economic landscape. The private sector and the third sector can deliver most public services more efficiently and effectively while the public interest is safeguarded by our democratic structures and control of the purse strings. We must not be restricted in our thinking by bad previous examples of poor PFI deals or unsatisfactory care homes, but we must learn from these lessons of the past and ensure we get the most for our hard-earned taxpayer pound. The Scottish Government’s shovel-ready projects should be pursued as this will provide worthwhile employment and much-needed increased infrastructure for the future development of our economy. We have really lacked such investment in this country for many years and we need to push on with this even in the most straitened times. President Obama has proved that this can work in the United States. We also desperately need banks to lend money to individuals and companies to allow potential growth to happen. The recently announced UK Government and Bank of England initiative is a step in the right direction as long as the banks do allow the free flow of this low-cost money into the market place. In some cases it might take longer to get our investment in the big banks (e.g. RBS) back if they lend more but the priority right now is overall business growth and this needs money. This is the backdrop of economic change we need – a new model of our economy which focuses on wealth creation leading to prosperity for all and not some overwhelming state which sucks money from the economy and uses expensive mechanisms to reinvest it where it chooses. The private sector can grow and soak up some of the public sector staff who will come on to the market but we need to facilitate their growth through good workforce planning and development linked to a procurement system which helps local companies win contracts. Essential also is a really active planning and development service at a local and national level embedded in a positive culture of growth and innovation. We have been the world’s most entrepreneurial country and one of the most international – and we can get there again. Politicians need to encourage that move – and not fixate on the constitution.
IoD Scotland launches the Director of the Year Awards for 2012 Is there a director in your company or another organisation whose excellence in leadership during 2012 deserves recognition?
ever has it been more important to seek out and identify those people whose leadership is making a real difference to Scotland. As the issues facing businesses across the country increase in volume and complexity, the IoD Scotland Director of the Year Awards will be a celebration of the contributions made to our country by the resourceful and creative directors working in all sectors – public, private and voluntary. The IoD Scotland Director of the Year Awards are open to all Scottish directors, or equivalent level, executive and non-executive, whether or not they are IoD members. They focus not simply on individual achievement but also on the importance of the director’s role in the community and the commitment and expertise contributed to businesses of all sizes at national and at global level. The benefits of entering extend beyond picking up one of the prestigious trophies; the shortlisted finalists will have a raised profile in the Scottish business arena via a media campaign and through the network of the IoD, and their finalist status will bring credibility and recognition to their company before and after the ceremony at the Crowne Plaza Hotel in Glasgow on Thursday, 21 March 2013. To nominate is simple: complete a
» Nominations open: NOW » Deadline for entries: Friday, 7 December 2012 » Finalists announced: Friday, 22 February 2013 » Awards Ceremony: Thursday, 21 March 2013 brief online form, submit a 200-word executive summary and a copy of your nominee’s latest annual report. The nominating process may be simple but the judging is rigorous, which is why the IoD Scotland Director of the Year Awards are held in such high regard. Full online nomination and booking details can be found on www. iodscotland.com – just follow the links to the Director of the Year pages. Thriving businesses are the powerhouse of the Scottish economy. These awards are our opportunity to applaud the energy and commitment of those individuals who are driving success in enterprises large, small, established and new, across Scotland Nominate them now ...... For further details, please email email@example.com or call 07721 530115. Winners all: The victorious directors from the 2011 awards
IoD Scotland Autumn 2012 | 05
IoD branch news
IoD appoints new Aberdeen Chairman Mike Bowyer looks to build on fine work of predecessor The IoD Scotland has announced the appointment of Mike Bowyer as the new chairman for its Aberdeen branch. Mike is a director of Nexcor Ltd and takes over the chairmanship from Ken McEwen, who had served in the role for over four years. In a career in the oil and gas industry spanning over 37 years Mike has held a number of senior technical and operational roles, including UK vice-president for Halliburton. Mike is a chartered director and chartered engineer, is a former board member and vice co-chair of Oil and Gas UK, was a member of the Step Change in Safety Leadership Team from 2004-2009 and chairman of the Well Services Contractors Association (WSCA) from 2005-2006. Retiring from Halliburton in March 2010, Mike set up his own business to focus on non-executive and consultancy assignments. He is currently a director of OPITO Strategic and co-chair of Step Change’s workforce engagement steering group. Mike Bowyer commented: “When I first became a director, there was a great deal I didn’t know about how to be effective in the position. The IoD was a great place
to go and gain the additional skills I needed. It’s a great organisation and I’m really proud to represent the Aberdeen branch. “My predecessor, Ken McEwen, has done a fantastic job of ensuring that the IoD in Aberdeen is in touch with its members. I intend to build upon this and look to further improve the IoD offering in the region and in turn increase the membership.” Ken McEwen said: “The highlight of my time as chairman has been to see the IoD in Aberdeen gaining a higher profile. As a consequence, our events have been well supported, with a high calibre of speakers from government ministers through to business leaders. “During this time we have kept delivering the message that Aberdeen City and Shire needs government backing and support if it is to maintain its role as the powerhouse of the UK economy and a global centre for the oil and gas industry.” New challenge: Mike Bowyer
IoD mentoring programme launches in the Highlands & Islands IoD Highlands & Islands chairman Paul Houlden writes: Our region began the roll out of the IoD Mentoring programme from September and I’m sure it will prove really useful for all. Pauline Dingwall, working with Caroline Donaldson, will lead the project here and here explains the process: The IoD offers a mentoring programme for members and non-members in the central belt of Scotland. This has been running successfully for a few years now and the IoD is now expanding it to include Highlands & Islands as of the start of September. Most mentoring programmes focus on business-to-business mentoring, but the IoD mentoring programme focuses on the person-to-person – more accurately, directorto-director. The intention is to provide a link with the highly successful Director Development programme. We are looking for the right kind of mentor with an appropriate balance and range of skills. Someone who is a good listener and someone who understands how and when to apply an effective push/pull style of influencing. Your operational sector is less important as you will
06 | IoD Scotland Autumn 2012
be partnered with the person rather than the sector or business. The kind of relationship required for mentoring is one of openness, communication, appreciation, fairness, and shared commitment. It is less important that you like each other as friends, for example, but vital that you can discuss and agree ways forward, goals, aspirations, fears and concerns You should be willing to commit to at least two hours per month and sessions can be face to face, on-line or by telephone, whichever suits those involved. You don’t have to be resident in the area where your mentee works or lives. How long the overall mentoring period lasts will vary depending on the requirements. It could involve months or years of input so you should be aware that this is no mean task, but we can promise you it will be worthwhile and you will have access to support all the way through. You will be helping to mentor current directors and up and coming directors, some of whom will be the next high flyers. In the North the programme is being managed by Pauline Dingwall, a member of the IoD and a Highlands & Islands committee member. A small charge of £100 is made as a contribution to the administration if the mentee is an IoD member. However, if they are not an
IoD member the contribution cost is £300. There is no financial cost to the mentor. If you feel you have the experience and willingness to help another director develop and grow we would love to hear from you. Please contact Pauline on 01463 771801 or 07771 885471 or e-mail Pauline@p2partners. co.uk to discuss the programme informally in the first instance. Sounds great so lets hope there are plenty of takers (and givers!)
Leadership lectures The first in our new series of Leadership Lectures, which are supported by Highlands and Islands Enterprise and hosted by UHI (North Highland College), will take place on 17 September at North Highland College, Thurso at 4.30. Fergus Ewing, the Minister for Energy, Enterprise and Tourism, will deliver the lecture, followed by a Q&A. Entry is FREE to all – not just IoD members so tell friends and colleagues who might be in the area and who would like to attend. The next in the series will be in Inverness in October but we are still waiting for a definite date – so keep your eye on www.iodscotland. com for the latest details.
IoD branch news
Introducing... your Edinburgh & Lothians branch committee The Edinburgh and Lothians IoD branch has been structured into sub-committees focusing on four of the five key areas in the Scotland business plan: • Membership Relations; • Business Environment; • Events, and • Marketing & Communications • Director Development is arranged by IoD Chair: Lesley Clark (pictured above) Director, Clark Communications firstname.lastname@example.org Secretary (Interim Chair till September) Barbara Robertson Director, Diamonds HR email@example.com Gina Cleife Business Development Director, Natwest Bank, Corporate Gina.Cleife@Natwest.com Susanna Freedman Director, Emperor Design firstname.lastname@example.org
Scotland Head Office. Please make contact with us if you have something to discuss. We always welcome ideas for event topics or business issues that need airing, etc. We look forward to seeing you at an event soon. If you are interested to become more involved with the committee, make contact with Lesley in the first instance.
Donald Forsyth Partner, Business Advisory Group, Scott- Moncrieff email@example.com Bill Fowler Partner, Head of Renewables and Energy, Semple Fraser Bill.Fowler@semplefraser.co.uk Ken Lewandowski Chairman, Financial Solutions Centre, Clydesdale Bank firstname.lastname@example.org
Emma Little Director, Execspace email@example.com Louise Scott Managing Director, Tidalfire firstname.lastname@example.org
Stuart Spence Relationship Director, Royal Bank of Scotland plc Stuart.Spence@rbs.co.uk If you have any queries, please get in touch with any member of the committee Emma Little
Escape to the beautiful Isle of Skye ... and enjoy an indulgent luxury break in the Highlands of Scotland at Duisdale House Hotel
Special offer for IoD members Special rate of £190BB per room per night including a glass of ‘Fizz’ on arrival. Employee rate for Members of the IoD. Valid for months of September and October 2012 Please call 01471 833202 Quoting IoD
• Award winning restaurant • Exclusive daily sailing trips on board our luxury yacht • Superb views over Sound of Sleat • Romantic and relaxing break Perfectly situated in the area known as Sleat on the southernmost tip of Skye, the Duisdale Hotel has been completely transformed into a chic boutique retreat in recent years. The hotel is in a class of its own and the 18 individually designed bedrooms come in a range of contemporary styles, some with Four Posters, but all come complete with the luxury amenities one would expect in a four-star hotel in Scotland. The award-winning restaurant presents the diner with choice before you even see a menu – will you choose to dine in our conservatory with views of the gardens to the Sound of Sleat or in our intimate fireside area? Whichever you choose, the setting will provide the perfect ambience in which to savour the innovative dishes created daily by the hotel’s kitchen. Our romantic hotel is set within 35 acres of beautiful mature gardens and an enchanting woodland backdrop, there is also a luxurious garden hot tub for guests to enjoy. Guests wishing to experience Skye from a completely different perspective can join us on our unique sailing trips on offer daily from April – September onboard the hotels private luxury yacht. For more information or to book, call 01471 833202 or see www.duisdale.com
Business news: Commonwealth Games 2014 As the Paralympics close and the euphoria surrounding the successful London Olympics fades, so attention turns to the next big multi-sports event in the UK – the 2014 Commonwealth Games in Glasgow. Away from the sportsfield, can Scotland’s business win any gold medals from this global event? The IoD asked representatives from the host council and the organising committee for their views on the opportunities that lie ahead
Business needs to focus on Games’ potential by Councillor Gordon Matheson, Leader of Glasgow City Council
he Glasgow 2014 Commonwealth Games, without doubt, presents the city with a unique opportunity to deliver a huge economic boost and bequeath a legacy that leaves us better off not only economically, but also socially and environmentally. After the enormous success of the London 2012 Olympic Games – like Glasgow 2014, a once-in-ageneration opportunity – we now look forward to hosting a great celebration of sport in the summer of 2014. While Glasgow was in the fortunate position of having 70 per cent of the necessary venues already built when the city was awarded the Games, the need to deliver the remaining 30 per cent, including the iconic Commonwealth Arena & Sir Chris Hoy Velodrome and The Hydro at the SECC, plus associated work such as the M74 completion, the Athletes’ Village and the first direct connection between the motorway network and the east end – The Clyde Gateway – has brought much-needed regeneration activity during a challenging economic period. These projects are changing the face of the city and undoubtedly make Glasgow a more attractive place in which to live, work, locate and invest. The Games have and will be good for Glasgow’s economy, giving our businesses and organisations the chance to develop trade, skills and business networks that will benefit the city as a whole, as will the massive infrastructure and environmental improvements being made ahead of Glasgow 2014. The council has been working in collaboration with partners in both the public and private sectors to develop the Games’ economic legacy. This has been enormous in scale in terms of its delivery, with the creation of jobs and training places for thousands of people through a range of measures aimed at maximising community benefits from major projects and providing a platform for Glasgow’s economic future. We have included community benefit clauses in contracts related to the Games that have helped to secure jobs and business opportunities for local people and companies, ensuring the 2014 Games leave a lasting
08 | IoD Scotland Autumn 2012
legacy for the people of Glasgow. Over £275 million of Tier 1 Games-related contracts have been awarded through the Glasgow Business Portal so far, with more than £181million going to Glasgow-based companies. The Glasgow Business Portal is an online business networking and matching service that originally published the hundreds of millions of pounds worth of both public and private sector contract opportunities for the Glasgow 2014 Commonwealth Games. Examples of these goods, works and services include everything from service contracts like catering and security to massive construction projects. Companies of all sizes can compete for Games-related contracts. Following the success of the council’s community benefit policy in relation to both Games projects and the Glasgow Business Portal, the council is working with partner agencies in both the public and private sectors to broaden its use in other infrastructure projects in Glasgow. At the same time as the community benefit clauses have benefited local people and firms, the council’s ambitious Commonwealth Apprenticeship scheme has found Modern Apprenticeship places for well over 2,000 Glasgow school leavers. Almost 20,000 registrations have now been made on the Glasgow Business Portal – over 4,500 from Glasgow – a figure that firms should note as organisations not registered or business-ready cannot bid for either Games-related contracts or other infrastructure projects underway or planned in the city. Those interested in discovering more information on the Glasgow Business Portal should visit: http://www.glasgow.gov.uk/ businessportal. These are exciting times for Glasgow with so much going on: there are many opportunities over the next few years and we are determined to make the most of them.
Investment: The iconic Sir Chris Hoy Velodrome, one of the new infrastructure projects built for the Games which will leave a lasting legacy for the city of Glasgow
Business news: Commonwealth Games 2014
Let’s keep inspiration flowing on to 2014 by David Grevemberg, Glasgow 2014 Chief Executive
he London 2012 Olympics Games was a truly inspirational event and already we have seen its positive impact in terms of how people are now looking towards Glasgow 2014. The Commonwealth Games is the second largest global multi-sport Games in the world, with 6,500 athletes and officials, a TV audience of 1.5 billion, and one million spectators. It is an exciting event and one which attracts attention from the international business community. Companies want to do business with us and want to be associated with the Glasgow 2014 brand, mindful that there are real and lasting business benefits. There are opportunities for businesses and for communities across Scotland and beyond to get involved with the Games and be part of it – which is a message we will continue to push in the coming months. We only recently passed our milestone of ‘Two Years to Go’ before the start of Glasgow 2014, but already things feel like they are beginning to happen. The Games are becoming a reality as we anticipate both the launch of our mascot and our volunteering programme. Glasgow 2014 will be a spectacular sporting event which showcases the nation on an international stage. In terms of Games Times Delivery, it is a serious business proposition. For suppliers, including those in Scotland itself, the opportunity to win business, raise
international ambitions and deliver growth could be enormous, but like the event itself, only the best will win gold. We are encouraging as many businesses as possible to engage with the Games. We can help them understand the opportunities of bidding for work and having the best possible chance of winning contracts. To maximise visibility, participation and fair and open competition, the Organising Committee advertises its procurement business opportunities through the Glasgow Business Portal as well as Public Contracts Scotland websites. Registration for both is free and takes only a few moments. Companies which register on the Glasgow Business Portal, provided by Glasgow City Council, can select the categories of goods and services appropriate to their business, and will receive automated email alerts on opportunities which match their preferences.
e are often asked what we see as the legacy of the Games and how are we working to achieve that legacy. It is about using an infrastructure that has been brought forward by the Games, not necessarily for the Games. That is an important message and where Scotland has got it right. To date the debate over legacy has been Glasgow-centric in some respects, and needs to extend over the next two years. In my view it is how public, private and the third sector can
New home: The Athletes’ Village, purpose-built for the Games and the first phase of the City Legacy development in Dalmarnock, which will grow to 1,500 homes
work smarter together, going forward – whether it is going after commercial opportunities or whether it is just efficiencies of scale. It is also about recognition of reputation. As an American I can praise Glasgow from a wider standpoint and praise, too, the efforts of Scotland to be innovative, sustainable, responsible, distinct, inspiring and exciting. The greatest thing that we feel that we have in an event like the Commonwealth Games is a chance to sing our praises and get the world to pay attention. Glasgow punches well above its weight, we have been doing that systematically all along this journey, and one of the aspects is how we present ourselves to the business community. Whether it is what we create, how we approach matters, or how we work together, all of those things are very relevant and very important. We are trying to play our part to get that narrative out to the world and say, ‘pay attention, Glasgow has got it right’. It is interesting that working with large and small companies, there is a lot of commonality. One of the things that we are finding, whether it is individuals, or whether it is organisations, is the level of ambition there. About a year ago we took a big shift in terms of our commercial proposition. We went from simply just offering, ‘here is the Games and the assets that come with the Games’ and started looking at community engagement as well as corporate and social responsibility. What we are offering is something far greater than the Games themselves. It really became about the ambitions of the Games versus the destination of the Games and carried people on that journey. It had touch points that we could start to take corporate partners on, or even small business communities, with us on the ride with different types of themes. That was the way that the organising committee is able now to start engaging. That means engaging with the community, people and businesses of all sizes in a different way and connecting them to Glasgow 2014.
IoD Scotland Autumn 2012 | 09
IoD Scotland Conference 2012
Building Scotland’s economic future and your role in it IoD Scotland Conference 2012 Date: Friday, November 2 Venue: Cameron House on Loch Lomond
uilding Scotland’s economic future and your role in it” is the ambitious theme at the heart of the IoD Scotland Conference for 2012. This special one-day event will provide an innovative and exciting opportunity to engage with highly connected representatives, key influencers and thought leaders from across the business spectrum to debate the issues surrounding the current economy and consider how we can work together to ensure growth and prosperity for all. High-profile keynote speakers who are rich in knowledge and experience of Scotland’s business presence in major markets will offer their own views on the current and future economic picture, with plenty of time for Q&A to allow you to join the debate and make your contribution. The programme will be delivered through plenary sessions, high-level workshops and will provide time for you to network and meet with speakers and fellow delegates during the conference and at the conference dinner. In addition, we are delighted that this year our schedule will include two highlights from previous Conferences. In what is always an enthusiastically received and rewarding part of proceedings, delegates will be addressed by young entrepreneurs who have been supported by the Prince’s Scottish Youth Business Trust. In addition, BBC Radio Scotland’s news and
politics programme, Brian Taylor’s Big Debate, will again be broadcast live from the Conference. Delegates will have the opportunity to join the audience, ask questions and air their opinions during the live show. This part of Conference was hailed as a great success last year when we linked-up with the programme for the first time and we are sure it will be as entertaining, informative and thought-provoking this year. The day will be rounded off by the IoD Scotland Annual Conference Dinner, which promises to be an enjoyable evening and a great opportunity to continue networking and discuss the issues raised during the day in a relaxed and friendly atmosphere. Our guest speaker at dinner is Brian Taylor, fresh from his lunch-time broadcast. Brian is BBC Scotland’s political editor and covers politics in all of its guises – UK, European and Scottish. Brian is the author of two books on Scotland’s Parliament, has lectured on politics and identity across Europe and the USA and was a lobby correspondent at Westminster. With his witty and unique up-beat style, Brian is sure to provide excellent entertainment. Places for the annual conference and prestigious dinner are always in high demand so we recommend that you sign up now to avoid missing out. In the current economic climate, we all have to tighten our belts – the IoD is conscious of this and has kept increases to a minimum with the price for the 24-hour delegate fee remaining at the 2011 rate.
Conference speakers Dr Lena C Wilson Dr Lena Wilson is Chief Executive of Scottish Enterprise – Scotland’s national economic development agency. Prior to this, Lena was Chief Operating Officer of Scottish Enterprise and the CEO of Scottish Development International, leading Scottish Enterprise in supporting companies to grow and Scottish Development International in helping to promote Scottish businesses overseas and attracting new high value investment to Scotland. In a career spanning over 25 years, she has held a range of positions covering all aspects of economic development. During a two-year secondment to the World
10 | IoD Scotland Autumn 2012
Bank in Washington DC, she worked in over 20 countries in Latin America, Africa and Asia advising governments on economic development with particular emphasis on the development of the private sector and the attraction of Foreign Direct Investment. Lena has held a range of non-executive positions in business, arts, sports and voluntary organisations. She is currently a Non-Executive Director of Intertek Group plc, a FTSE 100 company, Ambassador for the Prince and Princess of Wales Hospice and Edinburgh Military Tattoo, an Advisory Board Member of the University of Strathclyde Business School and a Member of the Scotland’s Financial Services Advisory Board (FISAB).
IoD Scotland Conference 2012 Sir Michael Rake
Our hosts: the stunning Cameron House on Loch Lomond is a superb venue for what is Scotland’s premier business event
Sir Michael Rake is Chairman of BT Group plc. In addition he holds a number of other roles, including Chairman of EasyJet plc, Deputy Chairman of Barclays plc and director of McGraw Hill Inc. Previously he held the posts of Chairman of the UK Commission for Employment and Skills from 2007 to 2010, was a director of the Financial Reporting Council from 2008 to 2011 and Chairman of Business in the Community from 2004-2007. From May 2002 to September 2007 Sir Michael Rake was Chairman of KPMG International having held other senior roles within the company. He joined KPMG in 1974, working in Europe and the Middle East before transferring to London in 1989. Mike is also a member of the Prime Minister’s Business Advisory Group and holds numerous voluntary board positions with organisations as diverse as the RNIB, Wellington College and the Prince of Wales’ Charitable Foundation.
Colin Robertson Colin Robertson is the Chief Executive of Alexander Dennis Limited, Britain’s biggest bus and coach manufacturer. The company employs 2,400 people, of whom 900 are based at its HQ in Falkirk. A qualified mechanical and production engineer with an Executive MBA, Colin began his career with Cummins Engine Company before joining JI Case, the tractor manufacturer, and then moving on to Terex Corporation. He was part of its leadership team as Executive Vice President which turned Terex into a $9 billion worldwide corporation. In April 2007 he left to become CEO of ADL. Since then the business has increased its manufacturing capacity by 50 per cent and 2012 turnover is expected to reach circa £440m, representing a three-fold increase in six years. ADL has established itself as the western world’s fastest-growing bus and coach manufacturer and is market leader in the UK bus sector and the largest British-owned UK automotive business. Colin is the current IoD Scotland Director of the Year.
Gavin Gemmell CBE
Colin Robertson, pictured at this year’s IoD Scotland Director of the Year Awards
Gavin Gemmell is Chairman of Archangels and investor director of three Archangel investments. He retired as joint senior partner of fund managers Baillie Gifford in 2001, after 37 years. Gavin was Chairman of Scottish Widows and a Director of Lloyds TSB Group until October 2007. He was Chairman of the Court at Heriot-Watt University from 2002-2008 and was awarded an honorary degree by the university in 2009.
Alan Lawson Former Scotland rugby international Alan Lawson is currently President of the Scottish Rugby Union. No stranger to business at senior level, during his career Alan held the positions of Chief Executive of Stoddard International PLC and Managing Director of Forbo Nairn. He was a management consultant with Coopers & Lybrand as well as, latterly, Chief Operating Officer at Loretto School in East Lothian.
A qualified chartered accountant and economics graduate, Alan spends much of his ‘retirement’ involved with the Bill McLaren Foundation, the aims of which are predominantly to develop and support rugby union and its values and to encourage and provide sporting opportunities for young people. Alan is passionate about the value of strong leadership in both sport and business.
More Conference news – pg 12-13 » » IoD Scotland Autumn 2012 | 11
IoD Scotland Conference 2012
Conference 2012 Simon Walker
Ros Taylor Ros is a leading UK psychologist, executive coach, successful businesswoman, author and a TV and radio presenter. Ros travels the world developing the leadership potential of employees through the Just Leadership™ programme, which she formulated. A creative academic, Ros is a chartered clinical psychologist, coach, trainer and regular speaker on the conference circuit. She has presented in the USA, Europe, and China and completed a lecture tour in Japan. Newspapers have described her variously as ‘the guru of personal development’ and ‘the best motivational speaker heard this year’. Ros has developed a unique style of coaching which achieves major insights and shifts in thinking as well as creating a vision for personal and business success. She draws on her background as a psychologist to facilitate creative strategies and move people on to become more than they would ever have believed possible. A regular on TV and radio, Ros has presented a social science research programme, Between Ourselves, for BBC Radio Scotland for two years, and was a presenter for five years on a nightly television news programme.
Simon Walker joined the IoD as Director General in October 2011. Previously he was Chief Executive of the BVCA, the organisation that represents British private equity and venture capital. Between 2003 and 2007 Simon worked at Reuters as director of Corporate Communications and Marketing and he was previously Communications Secretary to HM The Queen at Buckingham Palace. He was held senior roles at British Airways and Comair Ltd (South Africa). From 1996-1997 Simon worked as a special adviser in the Prime Minister’s Policy Unit at 10 Downing Street. Simon was a partner at Brunswick, the public relations group, and Director of European Public Affairs for Hill & Knowlton in Brussels. He was a member of the Better Regulation Commission. He is a governor of the environmental foundation, The Hillary Summit and a member of the parliamentary Speakers Advisory Committee on Public Engagement. Simon was born in South Africa, and has worked as a journalist and consultant in New Zealand, Belgium and the UK.
Conference workshops The morning session of Conference will feature four workshops, of which delegates choose one to attend. All the workshops reflect the main theme and thrust of the Conference and provide the perfect opportunity to look at specific issues in more depth in an informal, interactive session. WS1 - Are you exploiting your Intellectual Property? It could be your most valuable asset
Do you know how much of your business’s assets are tied up in your intellectual property? This session is the perfect opportunity for all businesses looking for the latest information and advice on IP – and is delivered direct from the people in the know – the Intellectual Property Office.
WS2 – Creative Leadership
Join The Glasgow School of Art for some useful tips on how to ignite creative capability and unlock the hidden value of your organisation.
WS3 - Being the best leader you can possibly be!
Attend this highly informative and interactive workshop for some great insights and tips on how you can be the best leader possible, facilitated by The Leadership Trust.
WS4 - Finding hidden cash and balance sheet value you didn’t know existed
Could you be eligible to recover funds from HMRC for development work? Do you have hidden assets that could be added to your balance sheet? Join the session delivered by Jumpstart and Metis Partners for a journey of discovery...
Conference sponsors and supporters Intellectual Property Office is an operating name of the Patent Office
12 | IoD Scotland Autumn 2012
IoD SCOTLAND ANNUAL CONFERENCE AND DINNER Friday 2 November 2012 Cameron House on Loch Lomond
“Building Scotland’s Economic Future and your role in it” Conference Booking Form Please complete a separate form for each attendee – photocopied forms are acceptable Please select your preferred option
Booking details (please complete in BLOCK CAPITALS)
❏ £210.00 + vat ❏ £240.00 + vat Day delegate – non-member ❏ £390.00 + vat Full delegate (24hr – single)* – member Full delegate (24hr – single)* – non-member ❏ £440.00 + vat ❏ £310.00pp + vat Full delegate (24hr – twin)* – member Full delegate (24hr – twin)* – non member ❏ £330.00pp + vat
First names (Mr/Mrs/Ms) .........................................................
Conference Day delegate – member
* 24hr delegate rate includes full day attendance, lunch, dinner, accommodation and breakfast (single/twin) on Friday 2 November. ≠ Day delegate rate includes full day attendance and lunch. Excludes accommodation and dinner.
Workshop selection Please select two options and rate in order of preference: 1, 2 – where 1 is your first choice.
Dinner and accommodation (non 24hr delegates) Dinner only – member Dinner only – non-member Accommodation – B&B – single occ. Accommodation – B&B – double/twin occ.
❏ £115.00 + vat ❏ £135.00 + vat ❏ £195.00 + vat ❏ £220.00 + vat
Bring your partner Additional cost to delegate fee above, based on double occ. on Friday 2 November. Dinner, accommodation and breakfast Accommodation and breakfast only
❏ £140.00 + vat ❏ £30.00 + vat
Please tick one or more of the boxes below and we will make the arrangements for your additional accommodation before/after the conference. Thursday 1 Nov – single occ. Thursday 1 Nov – double/twin occ. Saturday 3 Nov – single occ. Saturday 3 Nov – B&B double/twin occ.
Membership no (if applicable).................................................. Job title ................................................................................. Company............................................................................... Address ................................................................................. ............................................................................................ ............................................................................................ Postcode.......................Tel..................................................... Email .................................................................................... Dietary or special requirements ................................................ ............................................................................................
Bringing your partner (please see opposite for partner rate) Partner first name ................................................................... Partner surname..................................................................... Dietary or special requirements ................................................ ............................................................................................
Method of payment
❏ Cheque (payable to IoD Scotland) ❏ Please send me an invoice on receipt of booking form ❏ Visa ❏ Mastercard ❏ Maestro (issue no) ................... Card no ................................................................................. Expiry date ....................Start date ..........................................
Make the most of your visit
Additional accommodation (B&B)
Card security code .................................................................. Name on card ........................................................................ Cardholder’s address (if different from above).............................
❏ £195.00 + vat ❏ £220.00 + vat ❏ £195.00 + vat ❏ £220.00 + vat
............................................................................................ .....................................Postcode .......................................... Signature ...............................................................................
Please return the completed form to: IoD Scotland Conference | 3 Peel Gardens | Clovenfords | Galashiels | TD1 3LH | Fax: 01896 850400 I Tel: 07721 530115 The IoD Scotland will use your information for administration and analysis. We may share your information with carefully selected third parties. We, or they, may send you details of other goods, services or events that may be of interest to you. The information may be provided by letter, telephone or other reasonable means of communication. If you do not want your details to be shared with carefully selected third parties, please tick the box. ❏ Terms and conditions Full payment is required prior to the date of the event. Notice of cancellation must be given in writing and the following policy will apply: 15% administration charge at any point of cancellation, 25% administration charge from 12 weeks prior to the event, 50% administration charge from 8 weeks prior to the event, 100% administration charge from 6 weeks prior to the event. IoD Scotland reserves the right to alter the arrangements or cancel an event due to unforeseen circumstances, in which case every effort will be made to provide a refund.
Events diary A comprehensive guide to forthcoming IoD Scotland events. To book on any of these events, download the booking form at www.iodscotland.com, email: email@example.com or call 0131 557 5488
An Insight into ACE Winches
hosted by Aberdeen and Grampian Director of the Year Alfie Cheyne Date: Thursday, 13 September Time: 4pm Venue: ACE Winches, Towie Barclay Works, Turriff, Aberdeenshire, AB53 8EN Price: Members - £25 plus VAT Non Members - £35 plus VAT Alfie Cheyne is CEO and founder/owner of Alfred Cheyne Engineering Limited. ACE Winches is a global leader in the design, manufacture and hire of winches, marine deck
machinery and the provision of associated hire personnel for the offshore oil and gas, marine and renewable energy industries. This event, hosted by Alfie Cheyne, will give members and guests an insight into the business and his creative decision-making style. From its fishing industry origins to its emergence within the oil and gas industry, ACE Winches has expanded rapidly over the years and has a strong worldwide presence, executing projects throughout the world.
Non-executive director Breakfast Series Dundee
Venue: Henderson Loggie, Royal Exchange, Panmure St, Dundee, DD1 1DZ Date: Wednesday, 19 September
Venue: The Marine Hotel, 8 Crosbie Road, Troon, Ayrshire, KA10 6HE Date: Friday, 21 September
Venue: The Stirling Highland Hotel, Stirling Date: Wednesday, 24 October All three events run from 8.00am - 9.30am Price: Members £15 + VAT / Non Members £25 + VAT
Join David Watt, Executive Director, IoD Scotland to examine the role of nonexecutive directors at three special breakfast events in Dundee, Troon and Stirling. We will examine how effective and independent non-executives really are and how their role interacts with that of the executive board. Just as this role is becoming increasingly important – as evidenced, for example, by the importance which private equity investing institutions attach to nonexecutive presence on the boards of their investee companies – finding the right person for the job can be even harder given
the potential risks and responsibilities involved in this often demanding role. Our discussion will be facilitated by lead-in presentations from David and another non-executive director, yet to be confirmed. David’s own non-exec appointments include Scottish North American Business Council and Business Club Scotland. The development of excellence at board level is a key concern of the IoD and this workshop will provide an ideal opportunity to focus on, and ask questions about, the nature and scope of the non exec role. Numbers are limited so early booking is advised.
‘Harnessing the Power of Leadership Communication Sponsored by Intelligise
Venue: ‘Langley’, The Corinthian Club, 191 Ingram St Glasgow, G1 1DA Date: Wednesday, 19 September Time 6.00pm-8.00pm Price: Members £25 + VAT / Non Members £35 + VAT Our guest speaker for this event will be Heather Campbell. Heather is one of the UK’s leading experts on leadership communication and has worked with multinational companies in the UK and abroad at board level, teaching senior leaders how to increase the clarity, effectiveness and productivity of their professional interactions.
14 | IoD Scotland Autumn 2012
Call it dialogue, communication or simply conversation; every business is powered by the way its people relate to one another, ask questions and share knowledge or information. One key area where businesses fail in this regard is management communication, with over 90% of employees claiming their managers are poor communicators. Heather believes passionately that improving management communication skills is both vital and cost-effective, and a much under-estimated tool in driving up business performance. Her talk will focus on how managers can develop these skills to engage employees, facilitate conversation, engender positive action and handle difficult conversations.
How can you develop the skills to engage with employees, engender positive action and handle difficult conversations?
Dundonald to host IoD Scotland Golf Challenge Venue: Dundonald Links, Ayrshire, KA11 5BF Date: Friday, 21 September Time: 11am; First tee-off – 12 noon Price: Members: £75 + VAT Non Members: £80 + VAT
Venue: Date: Time: Price:
IoD Scotland invites you to enjoy a day of golf at Dundonald Links and to compete for three of our trophies! The golf challenges set include the Inter-regional Golf Challenge for the Ian Stevenson Trophy, as well as individual competitions for the Corporate Risk Trophy and the Bowring Trophy. The golf will be played over the challenging Dundonald Course which lies between Troon and
AECC, Aberdeen Tuesday, 2 October 5.30pm - 8.00pm FREE OF CHARGE
IoD Aberdeen welcomes members and guests to this influencers’ dinner to hear from Brian Horsburgh, MD of the Aberdeen Exhibition and Conference Centre and non-executive director of Visit Aberdeen as well as Steve Montgomery, MD of ScotRail. Destination Management Organisations has been established in Aberdeen tasked with attracting conference and event business into the Aberdeen area. Key to success in attracting business to the City are; the infrastructure and accessibility as well as partnerships and collaborations between businesses and other
Irvine on a stretch of Scotland’s golfing west coast. First tee-off times are at 12 noon though the day starts at 11am with coffee and bacon rolls and practice range access. A high tea will end the day at 5pm (approx), followed by the presentation of trophies and prizes. This event affords an excellent opportunity to network with fellow directors and IoD members as well as enjoy some fabulous golf.
Influencers’ Dinner on right rails with ScotRail & AECC
organisations. This event will focus on how organisations can work together to maximise opportunities. ScotRail, the UK’s largest regional train operator, provides 95 per cent of passenger rail services within Scotland as well as Caledonian Sleeper services to and from London. More than 2,300 services are operated daily across 346 stations, including the busiest commuter network outside London – Strathclyde. Steve joined the rail industry in 1984 as a signalman before moving on to supervisory
roles and becoming an area relief manager for the North of Scotland. Subsequently he was appointed ScotRail manager in Aberdeen before being appointed Area Manager for Edinburgh in 1994 as the railways prepared for privatisation. After privatisation he was appointed as passenger service manager for Central Scotland and took the same role for the North of Scotland area in 1997. Various senior posts followed. He became operations and safety director when ScotRail won the franchise in 2004.
Women in Business 2012 Multi-tasking; does it incorporate your future financial needs? Hosted by Angus MacLeod, Partner of St. James’s Place Wealth Management, Scotland
Monday, 8 October (Edinburgh) Tuesday, 9 October (Glasgow)
Time: 5.30pm – 8.00pm Venue: St. James’s Place Offices, 18-22 Melville Street, Edinburgh EH3 7NS
St. James’s Place Wealth Management will provide insight into how they help their time-precious corporate executive and business-owner clients realise their financial futures.
IoD Scotland invites our women members to a practical and relevant briefing specifically tailored to address the concerns facing many of you who are owners or leaders in your chosen industries.
Their support not only focuses on the growth and preservation of wealth*, but importantly, gives their clients the confidence that their financial futures are being looked after, whilst they can concentrate on their business and personal commitments.
Invariably, prioritising business commitments can result in limited, and indeed precious time to focus on other important aspects of your life.
* Products and services offered by St. James’s Place Wealth Management may include those that put your capital at risk.
St. James’s Place Offices, 131-133 Minerva Street, Glasgow G3 8LE
The Partner represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Services Authority) for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products. The title ‘Partner’ is a marketing term used to describe St. James’s Place Wealth Management representatives.
IoD Scotland Autumn 2012 | 15
“Probably the best one-day course I have ever attended”
The role of the non executive director, with IoD Scotland This one-day course identifies the various roles of the non-executive director (NXD) in a variety of corporate settings – family company, subsidiaries, Third Sector and Public sector; how their appointment can help balance a board and how they make an effective contribution to a board’s work. It also examines methods for their selection and reviews their motivation, induction and reward.
Course benefits Help improve your current performance as an NXD and help prepare you for the time when you may be appointed as an NXD. All delegates will receive a copy of the course tutor’s book ‘Faith in Governance’ as well as extensive course notes. There will be ample opportunity to share experiences and future aspirations.
Who should attend? Individuals who are currently a non-executive director; those seeking appointment as a nonexecutive director and those organisations planning to appoint a non-executive director. Over 100 delegates have successfully completed this course.
Costs • £299 plus VAT • Companies with fewer than 150 employees may be eligible for a 50% grant via Skills Development Scotland’s Flexible Training Opportunities programme.
Course content • What you as an NXD can bring to your board • What inputs NXDs can give to the board in different types of organisations and situations • An outline of the legal and ethical duties and responsibilities of a NXD • Clarification of the qualities and experiences needed to fulfil an NXD appointment • Practical guidance on how best to secure an appointment as an NXD • Provision of an overview of the UK Corporate Governance Code and other relevant codes of conduct • Detailed guidance on finding, selecting, appointing and rewarding NXDs
Course dates • Glasgow - 18th Oct @ IoD Glasgow Hub, West Regent Street. This course is full but a cancellation list has been created. Contact the IoD to join it. • Aberdeen - 25th Oct @ Doubletree by Hilton, Beach Boulevard • Edinburgh - 15th Nov @ Royal Scots Club, Abercromby Place. This course is full but a cancellation list has been created. Contact the IoD to join it. To book or for more information email director. firstname.lastname@example.org. Please note it is planned to hold these courses again next year, in April and May. Contact email@example.com to register your interest.
The future of the Scottish Economy post October 2014 Date: Thursday, 13 September Venue: Burns Suite, West Lothian College Time: 7pm-9pm Cost: Free of charge IoD Scotland executive director David Watt will be joining a high-profile panel at a special Question Time-style event organised by the West Lothian branch of the Federation of Small Business, to discuss the future of the Scottish economy, post-October 2014. The event is taking place in the Burns Suite at West Lothian College. The panel will be chaired by Susan Morrison, the well known comedienne and journalist. While this is not an IoD organised event, IoD members are more than welcome to attend. For more details and to book, contact Jonathan Innes at JInnes@innessculthorp. co.uk.
How to increase the value and sell your business Sponsored by Avondale Venue: Date: Time: Price:
IoD Glasgow, 2 West Regent Street, Glasgow, G2 1RW Wednesday, 14 November 9.00am to 1.00pm Free of Charge & inclusive of breakfast
This is an event specifically designed for owners of £1-20M turnover businesses in Scotland. It aims to provide directors/owners of businesses a comprehensive, step-by-step guide for strategically managing the entire process of buying and selling a business, from identifying your target company through to implementing a successful exit strategy. Mergers and acquisitions, legal and tax experts provide real world guidance and first-hand experience to help you prepare for an
16 | IoD Scotland Autumn 2012
acquisition or sale and navigate the associated complexities. Directors will also have the opportunity to share information and experiences with their peers and to network with other business leaders who are in a position to buy or sell. The panel of legal, tax and advisory experts will be on hand to answer any questions you have throughout the morning. Topics include: business valuations, optimising deal value, increasing shareholder
value, funding options, current economic risks and opportunities, deal structures, disclosures, guarantees, tax liabilities and opportunities as well as legal aspects. Speakers include: Remo Pisaneschi and Kevin Uphill of Avondale and Ralph Riddiough of BTO Solicitors. Further speakers will be announced shortly. Attendees are warmly invited to join us for breakfast at 9.00am for an event start time of 9.30am.
Alexander Dennis Ltd
Bus builder looks to change gear and hit the £1bn mark Award-winning CEO out to recruit high-flyers to boost ‘bench strength’ for company’s next phase of internationalisation
by Will Manson y anyone’s standards the rise of bus builder Alexander Dennis Limited (ADL) is the kind of ‘Phoenix from the ashes’ story that is breath-taking, demonstrating that Scottishbased businesses can succeed not only at home – but on the world stage as well. Just eight years ago this was a business on its knees, savaged by the collapse of its parent company, Mayflower Corporation PLC, and about to go under. Rescued at the 11th hour by a group of Scottish entrepreneurs, it has turned a £170 million British business into a £500 million global player, now building buses not only in Falkirk, Scarborough and Guildford, but also in Hong Kong, China, New Zealand, Australia, the USA and Canada. In the same period it has seen profits grow five-fold and turned a £70 million debt mountain in 2007 into £10 million of hard cash on the 2011 balance sheet. From survival mode it has moved through the gears to become UK market leader, winning no less than 50% of all new bus registrations in the home market last year. Today, driven by a policy of innovation and a determination to stay ahead of the pack – notably ahead of global giants such as Volvo, Mercedes, Scania and MAN – it is still winning 50% of the UK market, while simultaneously extending its reach internationally and reducing its dependency on the UK, which is infamously prone to peaks and troughs in the bus sector. In May this year ADL signed a JV with a company that could be described as North America’s equivalent of Alexander Dennis Limited, New Flyer Industries Inc., a listed business with a vast reach across the USA and Canada. The deal is predicated on the development of an ADL midi-bus designed and engineered for North America. ADL already has a 70% share of the UK midi sector and in recent years has turned this once quirky product into a global success story. Unlike full-length single decks the Enviro200 is shorter (10m v 12m) quick, light, incredibly fuel efficient and highly manoeuvrable, which makes it ideal for congested inner-city operations. Together ADL, which will engineer the product, and New Flyer, which will sell it, believe they can create a whole new market sector in the USA and Canada with
18 | IoD Scotland Autumn 2012
ADL CEO and current IoD Scotland Director of the Year Colin Robertson has ambitious plans to turn a ‘good £500m Scottish business into a great £1 billion global business’
the potential for 1,000 buses a year. In the meantime, exactly one month after signing the JV in North America, ADL was again making the headlines, this time acquiring one of Australia’s most iconic bus manufacturing brands, Custom Coaches. The deal saw ADL take 100% ownership with a £20 million cash deal funded entirely from reserves. Now it is set to make its mark in the southern hemisphere where it continues to grow its presence with contracts in Auckland, Wellington, Sydney, Brisbane and Adelaide. As indicated in the introduction to this story, this is no ordinary turn-around. This year will see ADL double export sales to circa 40% of its turnover, underpinning its business growth and internationalisation strategy, while retaining its commanding leadership in the home market. At the helm of the business is 47-year-old Colin Robertson, ADL’s multiple award-winning CEO, who was twice named Entrepreneur of the Year in 2011, as well as collecting IoD Scotland’s Director of the Year Award in March of this year. Robertson is a man who doesn’t hang about. Since joining the business – and taking a stake in it in 2007 – he has been relentlessly determined to see ADL “walk in its customers’ shoes”, giving them what they want, when they want it, coupled with a zealot-like determination to establish ADL as the best and easiest to do business with. One happy customer is FirstGroup, the giant bus and rail operator, which made ADL an “Accredited Green Bus Supplier” in Q4 2009. To this day they remain First’s only green bus supplier, so they appear to be doing a lot right, much to the chagrin of their rivals. Sir Moir Lockhead, former CEO of FirstGroup (now retired), told one of Scotland’s leading business editors: “Robertson has done a superb job. ADL’s buses are of a much better quality than they have ever been and that is the reason the whole industry is buying from them – and that is great news for Scotland.” Robertson now sees the next challenge as “turning a GOOD £500m Scottish business into a GREAT £1 billion global business.” To achieve this he has built a team around him that includes expertise in manufacturing, finance and business expansion. “We will never lose sight of the fact that customers are our bread and butter, our route to success. If THEY succeed then WE succeed, it’s about as simple as that, so we will keep our eye on the detail while continuing to innovate with vehicles that are lighter, better, more reliable, easier to maintain – and class-leading in terms of fuel efficiency. “We are already doing that on most fronts, notably with our electric-hybrid range which is currently returning fuel savings of 60% in such cities as Edinburgh, Perth and Aberdeen. We are now also on the cusp of a step-change
Alexander Dennis Ltd
break-through in this technology that can add another eight – 10 per cent further fuel savings.” And while all this is going on, Robertson is also busy building his ‘bench strength’ for the next phase of internationalisation. He commented: “We have a great team of guys working day and night, in all corners of the globe. Some have been hand-picked to join the team, others have recognised the need for change and moved with the times, contributing a wealth of industry knowledge and understanding, while others have been part of our extensive people development programmes and risen rapidly through the ranks at ADL. “As we strive to take the business to yet another level, we will continue to seek out and bring on board gifted people who want to be part of a growing, dynamic company with its roots in Scotland and its sights on the world.” • If you feel you have what it takes to be part of the ADL global team drop an e-mail to Bill Simpson, Group Corporate Affairs Director, at firstname.lastname@example.org
Scotland’s Transport and Housing Minister Keith Brown admires one of ADL’s new low carbon hybrid-electric vehicles. ADL is the biggest supplier of these buses in Scotland and across the UK, with over 600 in use or on order. At the end of August the minister announced a £3m government fund to further boost their uptake
IoD Scotland Autumn 2012 | 19
Business advice: Health and Safety
Health risks at work: do you know yours? Health and safety legislation tends to focus on the ‘safety’ and not the ‘health’ implications of bad practices at work, making the latter something of a junior partner in the relationship. However, a new programme instigated by Healthy Working Lives intends to address this imbalance
Help at hand: Healthy Working Lives’ DVD offers sound advice on how to ensure an employees’ career doesn’t end up making them ill
HE headline above is a fair question, and one that all directors should consider very seriously. As a manager or director it is important to be aware of the risks that your staff are exposed to during their work activities and the steps needed to address these exposures. The emphasis on risk has for a long time focused on financial and reputational risk, with the inclusion in many organisations of safety. Safety is regularly referred to as ‘Health and Safety’ but for most organisations the knowledge in this area has extended only into safety. Thus we have developed the silent ‘Health’ in Health and Safety, and the term as a whole has been used widely to mean you can’t do something. As a result, the real focus of health and safety within a business, to ensure that the work gets done and the activities and final products are safe and without risk to employees and users alike, is often lost. Health and Safety at work should add value to the organisation; after all, the only place to have a cost-effective employee is at work, not at home recuperating, or worse. Good safety practice means we all go home in one piece at the end of a hard day. Addressing health, particularly where work activities impact on the health of employees, should be no different. We all want to go home healthy and unaffected by exposures at work; the difficulty is often that these exposures don’t show themselves immediately. Demonstrating the effect of a fall from height or a vehicle accident is visual and immediately apparent, but it is more difficult to get messages about protecting health over to staff when there is no visible effect, at least in the short term. Things are changing, however. Health is coming to the fore and increasingly organisations are identifying that maintaining a healthy workforce has economic benefits, especially in a time of economic difficulty and where projections point to an ageing workforce being required to work longer before retirement. So – Health risks at work: do you know yours? Are you aware of the exposures to chemicals, dusts, poor posture, noise, vibration and stress levels among your workforce? Are you aware of the harm that this causes to health, sometimes in the short term but more realistically in the medium to long term? Are you aware that failure to identify and manage these exposures can have impacts on your organisation in terms of costs of staff illness or early retirement, potential legal costs and loss of skilled and experienced workers?
20 | IoD Scotland Autumn 2012
Managing staff health can help you mitigate against these potential losses and it’s perfectly realistic to need help and support to identify, manage and educate staff on these risks. Clearly there are plenty of opportunities to address appropriate health issues at work and the focus of a current initiative looks at health conditions caused or made worse by work exposures and activities. The initiative, called simply Health Risks at Work, began life in Scotland and is the result of collaboration between small businesses, the Health and Safety Executive, The Scottish Centre for Healthy Working Lives, the Royal Society for the Prevention of Accidents and The Scottish Chamber of Safety. While established in Scotland, from May this year Health Risks at Work became a national campaign, spearheaded by the network of support available through Safety Groups UK. The initiative provides guidance materials for managers to help identify and manage the common health conditions encountered in the workplace and consists of web-based resources, DVDs, quick reference cards and access to a range of support across the country. A key factor is that the resources of the initiative are available free to all businesses looking for support and SMEs in Scotland can access free face-to-face support and hard copies of the materials. So how does it work? You could log onto www. healthrisksatwork.com and view the introductory video. This is an ideal way of introducing yourself and your staff to the topics and can be used in meetings, training or during tool box talks to introduce a specific topic area. There are then five key chapters on common workrelated health risks and where possible the health and safety jargon has been removed so you will find information on: Risks to your breathing; Risks to your skin; Risks to your muscles bones and joints; Risks to your hearing and touch and Risks to your wellbeing. There is also a chapter on how and where to get help and support locally. The principle is to encourage employers to help themselves so each chapter follows the same format, asking and answering a series of questions which can then be translated into each workplace’s practices and activities. Ultimately this aims to demystify the process of risk assessment and help businesses decide on what prevention and control measures they need to implement to reduce work-related ill health. So take time to view the introduction video on the website given above, then consider if you are likely to have exposures to risk in your workplace. Further help and support is available from the Scottish Centre for Healthy Working Lives on 08000192211.
Young people & employment
Barnardo’s Works engage n train n qualify n employ
World-renown charity offers new path to employment for young people that’s a win-win situation for employers
ow in its 13th year of operation, the Barnardo’s Works programme offers a costeffective recruitment service for employers that’s a real win-win situation. For not only do you get the opportunity to trial a prospective employee for up to eight weeks for free, you do so confident in the knowledge that you are boosting your company’s corporate social responsibility commitment at the same time and helping young people in your local community. Typically, people link Barnardo’s to its shops and residential care centres and other work with vulnerable children but Barnardo’s Works aims to help those young people as they leave education and look to progress into employment. It is a successful and well-established programme that equips disaffected young people with the skills, experience and opportunities they need to access independent, sustainable employment. The programme partners them with employers to provide a supported path to employment in areas that have a specific skills shortage. The young people start on a work placement of up to eight weeks, usually staying on benefits so there is no cost to the employer. At the end of the placement, the employer can look to offer paid employment if the candidate is suitable. All the way through the process the Barnardo’s Works team provides support and assistance, ensuring both parties are getting the most out of the programme. Even if employment is offered Barnardo’s Works’ role doesn’t stop there: its liaison team keep in touch with both employee and employer to iron out any difficulties and to support the ongoing development of the young person. The programme effectively addresses issues at the root of social exclusion and assists young people to overcome disadvantage and the impact of poverty. Between 60% and 75% of participating young people achieve independent employment. Barnardo’s Works is aimed at young people who require additional support to access and maintain employment and training. The programme works in a number of stages. Its foundation is based on Barnardo’s
own induction process. The young people it works with have to show a commitment to want to work with Barnardo’s. In the initial stage, a project worker is appointed to guide the candidate through a pre-programme taster, and helps build up confidence and basic skills until the young people are ready to take the next step and enter employment on a work placement. Work placements are the young person’s introduction to working life. Barnardo’s looks to offer suitable placements across multiple vocational sectors to help young people move into a sustainable employment opportunity that matches their aspirations. The placement is bespoke, designed around the young person and their experience and skills. Barnardo’s works closely with the employer during the placement, managing their experience. An in-house mentor helps improve the skills and confidence of the young person, while adding value to the experience for the company, too. The process is monitored by the project worker, who meets with the young person each week to check that they are happy, and with the employer, who meets a Barnardo’s liaison officer each month. The ultimate goal of any work placement is that at the end of the period, the young person will obtain paid employment with the employer. Barnardo’s can help by offering financial
assistance to cover wage subsidies or support for further training. As the young person becomes more confident with their employment, so Barnardo’s links are reduced, though the team will always be on hand. Barnardo’s will create an aftercare plan with the young person, and look to the employer to provide a workplace mentor and provide training if required. Barnardo’s will also agree a development plan with the employer, and sit down at specific intervention points with the young person and employer to evaluate progress and discuss future development plans. This is a programme that has a proven track record. Barnardo’s works in close partnership with over 100 employers and support them to take on young people in areas where they have opportunities. We listen to our employers: they tell us what they need and how we can support them. Among the many companies who are our partners on this programme are Scottish and Southern Energy, Scottish Water, MITIE, Bear Scotland, McCarthy and Stone and the Royal Mail.
Interested in finding out more? Contact Tommy McDade on 0141 429 7070 or 07824 694225 e: email@example.com
Barnardo’s Works engage n train n qualify n employ Cost-effective recruitment Assess a potential employee before you recruit Barnardo’s Works supports 16-24 yearolds, preparing them to find secure and sustainable employment by developing the key skills employers are looking for n Up to 8 weeks placement at no cost to you n Training and qualification for employees that suit your needs
n Support from Barnardo’s team before and during the placement, and beyond n Demonstrate your organisation‘s commitment to the community and CSR by giving a young person a chance to build a career
Interested in finding out more? Contact Tommy McDade on 0141 429 7070 or 07824 694225 e: firstname.lastname@example.org
IoD Scotland Autumn 2012 | 21
Preparing for the future Scottish qualifications are changing as education gears up to the challenges of the 21st Century
urriculum for Excellence is the new approach to learning in schools and colleges which will develop young people’s skills for the 21st century. The Scottish Qualifications Authority (SQA) has developed new National Qualifications to support Curriculum for Excellence. The new qualifications, which will be available in schools and colleges across Scotland in a year’s time, will help young people reach their full potential as they progress from their broad, general education through to college, university, other learning, training and employment. SQA is working with employers to ensure the new qualifications are well understood. Isabel Millar has recently joined SQA’s Curriculum for Excellence (CfE) Liaison Team. Isabel works with employers, training providers and stakeholders to develop their understanding of the new National Qualifications. Here we look at some of the questions most often posed to the Liaison Team. If you have any other queries, Isabel can be contacted at email@example.com or on 07825 689 222. Why are qualifications changing? Curriculum for Excellence has brought a new way of learning into schools and colleges, equipping young people with the skills, knowledge and understanding they need to succeed in the 21st century. The skills young people learn today will help them to succeed in life outside the classroom. Our new qualifications will help young people demonstrate and recognise the knowledge and skills SCQF level Current National Qualifications
“Curriculum for Excellence has brought a new way of learning into schools and colleges, equipping young people with the skills, knowledge and understanding they need to succeed in the 21st century”
they’ve acquired at school or college and help them adapt to further learning, training and employment. Which qualifications are changing? The table at the foot of this page shows the new qualifications and the current qualifications that they will replace. When can I expect to see young people with the new qualifications? The new qualifications will be introduced from August 2013 onwards. The first young people to leave school with the new National 1, National 2, National 3, National 4 and/or National 5 will do so in June 2014. Many young people will continue to study at school or college after they turn 16, and some may go on to study for the new Higher and Advanced Higher. The first of these young people will leave school or college in June 2015 and June 2016 respectively. Some schools and local authorities may implement the delivery of the new qualifications in different ways, so these timescales could vary across the country. How will the new qualifications be graded? Courses at National 2, National 3 and National 4 will not be graded. They will be assessed as pass or fail. Courses at National 5, Higher and Advanced Higher will be graded A to D or ‘No Award’. New Awards As well as developing new National Qualifications, SQA has developed a number of new Awards. These don’t replace any existing qualifications. Their job is to give
New National Qualifications
1 and 2
Access 1 and Access 2
National 1 and National 2
Access 3 Standard Grade (Foundation Level)
Standard Grade (General Level) Intermediate 1
Standard Grade (Credit Level) Intermediate 2
Advanced Higher (new)
22 | IoD Scotland Autumn 2012
IoD courses take directors to the next level Chartered Director status - the professional qualification for directors
I young people more ways to demonstrate their achievement at school and college. Some of the new Awards cover work from across different subjects areas, are shorter than traditional courses, and recognise success across different levels of difficulty, meaning they’re suitable for young people of all abilities. The new Awards, which became available in schools and colleges in August 2012, are marked and assessed by schools and colleges and do not have any external assessment or exams. SQA will check the assessments to make sure they meet national standards. Other types of National Qualifications As well as the new qualifications, we are continuing to offer other types of National Qualifications that support learners’ wider achievement. These include Skills for Work Courses, which encourage learners to become familiar with the world of work, and National Progression Awards and National Certificates which assess skills, knowledge and understanding in specialist vocational areas and prepare young people for employment, career development or progression to further study at HNC/ HND level. Where can I find more information? Our website, www.sqa.org.uk/cfeforemployers, is full of useful information to help you understand the changes to the new National Qualifications, including how they have been developed and how we are working with teachers and lecturers to introduce them. You can also keep in touch with us on Facebook at www.facebook.com/ScottishQualifications Authority, follow our updates from @sqanews on Twitter and subscribe to our YouTube channel www.youtube.com/user/SQAonline.
Want to know more?
SQA CfE Employer Liaison Manager, Isabel Millar, is available to answer any questions you may have and can be contacted at isabel. firstname.lastname@example.org or on 07825 689 222.
oD professional development courses, leading up to Chartered Director status, give you the ideal platform on which you can demonstrate that you have the expertise and integrity needed to meet the challenges of business today. If you are looking to enhance your skills and improve your organisation’s performance, Chartered Director is the professional qualification you need. IoD Chartered Director courses are unique in that they are geared solely at the responsibilities modern directors embrace. They are ideal for delivering focused learning in areas where your personal skill set may be lacking, particularly in the finance world. In addition the courses help to demonstrate to shareholders, stakeholders, clients and customers that their organisation is professional and successful and allow you to appreciate all aspects of effective business leadership and sound corporate governance. IoD Scotland has drawn up the diary for the courses it will be running in 2013. More will be added as we get closer to the end of 2012 and into the new year.
IoD Scotland Director courses 2013 16 -17 January 23-25 January 4-6 February 12-13 February 17-18 April 23-25 April 15-17 May 30-31 May 12-13 September 17-19 September 25-27 September 9-11 October 22-23 October
Role of the Director & the Board Finance for Non-Financial Directors Director’s Role in Strategy & Marketing Director’s Role in Leading the Organisation Role of the Director & the Board Finance for Non-Financial Directors Director’s Role in Strategy & Marketing Director’s Role in Leading the Organisation Role of the Director & the Board Finance for Non-Financial Directors Developing Board Performance Director’s Role in Strategy & Marketing Director’s Role in Leading the Organisation
Are you getting the most out of your membership of the IoD? Remember, your IoD membership brings many benefits... • Free access to IoD meeting space in centres around Scotland and throughout the UK • Local networking events across the UK • Free one-to-one business advice • National conferences, seminars and events • Free business information and research • Free business tax and legal advice • Your views represented to Government • Free online networking Make the most of your membership. For more details call the IoD Scotland head office on 0131 557 5488
IoD Scotland Autumn 2012 | 23
Pensions: Any good news? The current economic position is making the already complex world of pensions increasingly difficult – and the promise of new legislation could add further challenges, says Mike Kennedy, partner at Barnett Waddingham LLP in Glasgow As a consulting actuary I seem to have spent the last few years delivering bad news to pension scheme trustee boards, members and sponsoring employers. Investment markets are all over the place, legislation is more onerous and people are living longer (technically that is good news, but it doesn’t help manage the cost of pension schemes!). Overall this means that deficits in defined benefit (DB) schemes are getting bigger and pensions are becoming more expensive for employers to provide. As employers only have finite budgets to spend on pension benefits, this means less certainty in the level of retirement income employees can look forward to. To put the impact of rising pension scheme deficits into context, Barnett Waddingham recently carried out a survey of pension costs on FTSE 350 companies over 2011. Of these companies, 221 have DB pension schemes. Over all these companies, the average contribution per employee paid to clear the deficit in the DB scheme was £3,400 in 2011. This compares with the cost of providing future pension provision (including contributions to money purchase arrangements) for current employees of £2,600 per employee in 2011. Furthermore, in 49 of these companies, deficit contributions exceeded the amount of free cashflow over 2011. The results of our survey showed wide variations across industry sectors, and clearly the issues affecting FTSE350 companies will differ to those for smaller employers. However, the principle that good quality pensions are becoming more expensive to provide still applies. So can employers expect any respite from these rising costs in the next few years? Possibly not if impending pensions legislation from Europe and the current low interest rate environment persists. ‘Solvency II’ is a European-led initiative designed to strengthen the capital backing of the liabilities of insurers. There has been much debate about whether a Solvency II-style regime should apply to occupational pension schemes. This regime would impose more stringent funding requirements on UK pension schemes, such as limiting the time period employers have to clear deficits to, say, 15 years. If there is any good news in this regard it is that
24 | IoD Scotland Autumn 2012
“Our survey showed that good quality pensions are becoming more expensive to provide...” the latest proposals on the subject, which were expected to be tabled by the end of this year, have been put back to summer 2013. Further good news is that it is subject to strong opposition in the UK, including from Pensions Minister Steve Webb. The low interest rate environment is hurting schemes, as this acts to place a higher value on scheme liabilities. It also acts to increase the premium charged by insurance companies to take on pension scheme liabilities, making risk management exercises prohibitive for many employers. Long-term interest rates have to rise at some point, but it is certainly not obvious when this will happen. As and when they do, pension schemes will report lower deficits (all else being equal!) which will ease the strain on employers. In the meantime employers need to work with trustees to arrive at more creative ways to fund deficits, for example by granting security over assets rather than simply making cash contributions. Finally there is the issue of auto-enrolment to look forward to. These reforms have been in the pipeline for some time now, but will become reality for the largest employers in the UK later this year. This will put additional pressures on employer costs, not only through additional contributions in respect of employees not currently in a pension scheme, but also in terms of the additional HR/payroll
systems that may be required to comply with the requirements. The administrative requirements of auto-enrolling all staff should not be underestimated: even the process of identifying which staff should be auto-enrolled is far from straightforward. Not only will employers need to ensure that any scheme they have in place satisfies the auto-enrolment requirements, but they will need to have appropriate processes set up to ensure all eligible staff are enrolled on the first date on which the requirements apply to them (known as the staging date). These processes will also need to identify when non-eligible staff subsequently become eligible (either through their age, employment status, etc) or need to be re-enrolled if they opted-out initially. Careful planning will be needed for this and our advice to employers is that they plan for this at least 12 months ahead of their staging date. It is essential that employers know when their staging date is. Earlier this year the Government announced that staging dates for smaller employers will be pushed back to between 1 June 2015 and 1 April 2017. Furthermore, the dates on which minimum contribution levels increase have also been put back, with the final increase to three per cent kicking in from 1 October 2018. So there is some good news out there…
Acting as one team The UK’s largest independent provider of actuarial, administration and consultancy services Our services include: • Corporate Consulting
How to contact us
• Employee Benefits
• Investment Consulting
Barnett Waddingham LLP 163 West George Street Glasgow G2 2JJ
• Longevity Consulting
0141 243 4400
• Insurance Consulting
• Pension Administration • Private Clients (inc SIPPs, SSAS, Executive Pensions & Investments)
• Public Sector Consulting • Trustee Consulting
Barnett Waddingham LLP is authorised and regulated by the Financial Services Authority and is licensed by the Institute and Faculty of Actuaries for a range of investment business activities
AMERSHAM | BROMSGROVE | CHELTENHAM | GLASGOW | LEEDS | LIVERPOOL | LONDON
There’s nothing to celebrate for some directors as Bribery Act reaches its first birthday
e witnessed the first anniversary of the Bribery Act in July, the piece of legislation widely regarded as one of the most stringent anti-corruption laws in the world. The Act creates several new offences (with a maximum penalty of 10 years’ imprisonment and / or an unlimited fine) for which employees, directors and commercial organisations can be held liable. Under the Act, any individual or organisation doing business in the UK or with ties to the UK may be prosecuted if found guilty of bribery. The Bribery Act introduced the corporate offence of failure to prevent bribery which imposed strict criminal liability on a company for the actions of a person ‘associated’ with it. The only defence for a company is for it to prove it had ‘adequate procedures’ in place to prevent bribery. Given the penalties and the extra-territorial reach of the Bribery Act, the reaction from some businesses has been surprising. A recent survey by Deloittes showed that fewer than 10 per cent of companies surveyed are concerned about Bribery Act enforcement against their company. Furthermore, the Ernst & Young Global Fraud Survey shows that only 26 per cent of executives believe that the Serious Fraud Office (SFO) are willing to prosecute cases of bribery and corruption and are effective in securing convictions. Whilst it is true that there has so far only been one prosecution under the Act and there has yet to be a corporate prosecution, this is no reason for companies to become complacent. This Spring the Serious Fraud Office, the agency tasked with enforcing the Act, indicated it is in the process of reviewing self-referral
26 | IoD Scotland Autumn 2012
cases and noted it has entered the pre-investigation stage for a number of businesses. As enforcement under the Act is likely to increase, businesses that have weak anti-corruption procedures face hidden penalties. New regulations were introduced in Scotland on May 1 this year to prevent firms linked with individuals convicted of bribery from bidding for public sector contracts. If your company has failed to implement adequate procedures to prevent bribery as required by the Bribery Act 2010, you are at risk of being barred. You could also lose business deals with new or existing clients if they are unhappy with your anti-corruption procedures. All Directors, including non-executives, should have evidence that anti-bribery policies are fully implemented. Due diligence should now be conducted with intermediaries, partners and agents to assess their anti-corruption procedures. Companies that have adopted outsourcing by moving back-office processing and manufacturing to more cost-effective locations also face risks. Some businesses may be operating in geographic markets that carry higher risks of corruption. Overseas locations may seem attractive because of their low cost base, but this may also mean an environment where corruption is more prevalent and an established way of doing business. Businesses are feeling the heat of an intense spotlight on their activities by governments and regulators, as indicated by the recent spate of high profile scandals. Many of the investigations have been prompted by new anti-corruption laws that have been introduced in countries, such as Brazil, Russia, China and Indonesia. Barclays has already been fined £290 million by UK and US regulators for rigging the Libor rate. Seven banks,
“New regulations were introduced in Scotland on May 1 this year to prevent firms linked with individuals convicted of bribery from bidding for public sector contracts. If your company has failed to implement adequate procedures to prevent bribery as required by the Bribery Act 2010, you are at risk of being barred...”
Solutions for the end game by Bob Hair
including HSBC and Royal Bank of Scotland, are to be questioned in the US for alleged manipulation of rate, too. The global banking group, Standard Chartered, has reached a $340m settlement with New York’s bank regulator over transactions linked to Iran. Could your business withstand the scrutiny of shareholders, lawyers, regulators and the media if it were ever placed in the spotlight over a bribery or corruption allegation? If you’re concerned your business could be exposed to the risks of bribery and corruption, you’re encouraged to participate in the anti-bribery e-learning series that the IoD has developed with E-Security Exchange Ltd. The e-learning series conforms to Principle 5 of the Government Guidance of the Bribery Act (ie, communication, including training, to prevent bribery). The units offer practical guidance for ensuring that ethical behaviour and compliant procedures can be embedded into working practice. They are delivered in short segments, therefore minimising disruption to productivity, and divided into those that may be suitable for line managers and above as well as staff in nonmanagerial positions to ensure awareness is disseminated throughout the organisation. Now that the British Standards Institute has issued BS10500 as an Anti-Bribery Management System, adherence to the standard is likely to form an essential requirement from organisations issuing tenders. Our e-learning can help you comply with the Bribery Act and place you at an advantage when bidding for new business. Want to know more? For further details, please phone E-Security Exchange Ltd at 0141 255 0987 or email@example.com
Relatively speaking... the immorality of tax avoidance is very much de rigeur. With the recent “outing” of public figures who are engaged in opaque tax schemes, the dawn of an age of austerity which has galvanised governments all over the world to aggressively raise and pursue taxes, and hardened public opinion towards the plight of over-taxed high earners in an environment where everyone is feeling the pain, you could be forgiven for thinking tax is only synonymous with bad news. There are, of course, still many ways of reducing the taxman’s slice of your hard earned cash, but for business owners, and particularly those considering the issue of succession planning with their business, some attractive options are available which are, in some cases, actually quite generous. Take Entrepreneur’s relief, for example. The radical shift in the capital gains tax (CGT) landscape on 23 June 2010, which increased the headline CGT rate to 28 per cent, had far-reaching effects for owner-managers contemplating a future sale of their company. However, “Entrepreneur’s Relief ” (ER) was simultaneously enhanced, enabling sellers to obtain a 10 per cent CGT rate on their first £5m of eligible gains, and this has subsequently been increased again to £10m. This means that ER is now capable of producing tax savings of up to £1.8m. Against the current backdrop of our penal tax rates, the low 10 per cent ER rate now becomes a very valuable tax break when compared with a top tax rate of 50 per cent for income tax. So, relatively speaking, Entrepreneur’s Relief is a pretty big deal for all business owners, because you don’t need to have gains of £10m to qualify. The availability of ER will invariably be the most important tax consideration for owner-managers when preparing for the sale of ‘their’ company. However, the interaction of ER with the other CGT rules affecting company share sales must be carefully understood and planned for to ensure the full benefit of the ER is realised. There are other planning options for those seeking an exit, or perhaps just a solution to help them pass on the business to the next generation: Pensions. Boring to some, but conventional wisdom has its place – save at sensible levels throughout working life, funding pension contributions through the business and accumulate enough to retire without having to sell the business, or being totally dependent on doing so. Given changes to the pensions regulations, this needs to be done over time with a sensible target in mind, and with ‘auto-enrolment’ just around the corner, all business owners should be looking closely at their pension arrangements in any case; Management Buy Out – aligning the interests of all in a family-owned business can be extremely tricky, and adding in the expectations of management brings another layer. A clean exit can be made through an MBO, but this usually depends on capital being available. If funds cannot be immediately available, it is possible to build in substantial “earn out” terms which can be taxed at the 10 per cent rate; Remuneration strategies – in many cases, “keeping it in the family” will be the prevailing condition for a family owned business. Shifting control of the business to the next generation is intensely personal, but having a sensible arrangement in place for the transition can be achieved. With careful planning and sensible guidance through all of the options, all things are possible. Relatively speaking, of course. • Bob Hair MIOD is executive director and head of financial planning at Turcan Connell Asset Management, a leading wealth management and tax adviser to individuals, families and charities.
IoD Scotland Autumn 2012 | 27
Techs and balances
by Bill Magee Scottish Business Technology Writer of the Year
No clouds to spoil this IT revolution
his column always tries to bring you, the reader, clever and at the same time highly cost-effective tech solutions, so vital if your company is to succeed in these still difficult economic times – or, indeed, to stand out in the marketplace. I’ve come across such a market leader: Cloudwise, a strategic link up between The Wise Group, Campbell Nash and Microsoft’s Cloud Champion IA Cubed where, based on years of experience in the enterprise sector, a ‘centre of excellence’ has been developed to focus on helping Third Sector businesses get the most out of cloud technologies. This free service helps organisations make the transition to the cloud both technically but, more importantly, on an organisational basis, involving vital governance, roles and responsibilities, policies and procedures and transition plans. Everything to make such a transition occurs smoothly. The service doesn’t stop there as it also goes on to support those same organisations, helping them nurture and grow their use of cloud technologies by providing technical support, business blogs, ‘how to’ guides and planning guides. Obviously an organisation has to use cloud technologies to make use of the service but as that normally means it’s cheaper to run than ‘on-premise’
28 | IoD Scotland Autumn 2012
technology, it offers up a really clever way for the Third Sector to embrace the phenomenom of the cloud. Campbell Nash director James Armstrong points out that the interesting thing about Cloudwise is that their focus is not the technology but rather what the Third Sector can do with that technology. They have interesting credentials in that being born out of the Third Sector themselves, they are acutely aware of the pressures to increase the proportion of money that Third Sector organisations can deliver to front-line services. This means reducing administrative costs within organisations, collaborating with other Third Sector organisations and commercial businesses as well as allowing staff to work in new and innovative ways. Through Cloudwise, Third Sector organisations are now achieving that and introducing clever ideas that their own staff have brought to the fore, where they are tested and developed. James likens this to ‘CloudSourcing’. The bottom line is how Third Sector efforts can foster Corporate Social Responsibility (CSR) strategies to create business and social value and it seems to me that Cloudwise represents a unique method by which such not-for-profit ventures in the sphere of social activity undertaken by organisations – public and private – are
“Obviously an organisation has to use cloud technologies to make use of the service but as that normally means it’s cheaper to run than ‘on-premise’ technology, it offers up a really clever way for the Third Sector to embrace the phenomenom of the cloud...”
PR & marketing
Want impact from your PR? Pace yourself Having a long-term and well thought-out PR strategy is essential if it is to deliver the results you want, says Ken McEwen
increasingly engaging in fulfilling their CSR responsibilities and aspirations. Where Cloudwise comes in is to enable these outfits to make their move into cloud computing. Hosted by Microsoft it makes the transition to the cloud pain free and there’s no need for any tech hardware procurement. Your employees are kept up-to-date when new versions of software are released and the system is designed to be accessed from any location and connect from any device. All data is stored on central servers backed up on a daily basis. First thing to do is to get a Cloudwise specialist to conduct a health check on your current IT systems and take it from there. Josh Waldo, senior partner in Microsoft’s Worldwide Partner Group, says of Cloudwise: “The partners in this (Microsoft Cloud Accelerate) program are doing amazing things and are looking to differentiate their business and better serve customers with Microsoft cloud solutions.” If you want to know more, see www.cloudwise.org • Catch my Daily TechPost on Twitter #billamagee
Part of the Chartered Institute of Public Relations’ definition states that public relations is “the planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics”. Two of the key words there are “planned” and “sustained”. It is the second that I want to focus on for the moment, because that is where so many organisations fail in their PR efforts. The most obvious reason that PR activity is not sustained is that it simply is not accorded due priority. We all lead incredibly busy business lives and have so many demands for our attention that it is easy to consign PR issues to the pending list, or worse still, the infamous ‘round file’. But at a time when reputation is so important to business success and when fast-paced communications and social media make the risk to reputation greater than ever, it is a foolish business that doesn’t accord PR a pretty central role in its management thinking. The other danger is the sporadic approach. I have lost count of the number of times that I have been called in to meet a managing director, or other board member, to “put together a press release”. As we sit there it becomes obvious that there is not one story, but half a dozen, or more. It sometimes takes some persuasion to plan a programme of news announcements, when the client’s intention was to pile all the news into one mega brief. There are a number of reasons to break announcements into component parts. One is that you can develop a
strategy for a PR campaign that uses the news to communicate the desired messages to particular audiences over a period of time. The second is that people cannot assimilate too many messages at one time. I was no great fan of Margaret Thatcher as a politician, but as a speaker one of her strengths was her speeches that used the magic of three – three messages at any one time, and delivered using phrases with three key words. The third reason is that making a programme of PR activities is essential, if you are to make a truly “sustained effort” in your PR campaign. The importance of this was brought home to me when planning the Save Camphill campaign, which was described as the biggest community campaign in Scotland at the time. When working on the strategy we had to plan for a campaign that could be sustained over time. In the event we had two years of intensive activity that culminated in achieving the objective to move the proposed Aberdeen bypass away from two special needs communities. Planning for the long term is a good lesson, too, for the PR function in any business. So next time your PR executive or consultant comes in for a meeting, don’t push for one mega announcement. Instead, pace yourself and talk about a sustainable programme that can build and maintain your reputation. • Ken McEwen, the past chairman of IoD Aberdeen, has his own PR consultancy business – Ken McEwen Public Relations. More at www.kenmcewen.com.
IoD Scotland Autumn 2012 | 29
Social issues & CSR
Children still need the help that businesses can offer Ken Dunbar, Chief Executive, Aberlour Child Care Trust
t Aberlour Child Care Trust, we have a saying; “times have changed, but the problems haven’t”. In truth the problems have become more acute. But in the current environment, like many other charities, we need to adapt our practices while continuing to deliver services to the highest standards. When working with children and young people, many of whom have had difficult lives, we need to spend a lot of time with them, helping them to have a better life. However, such work comes with its own sensitivities and despite needing to do more for less, we cannot afford to cut corners when dealing with people’s lives. Aberlour Child Care Trust has an enormous wealth of experience of providing for the needs of children and young people. Founded in 1875, our organisation started life as a large orphanage in the highlands, catering for mitherless bairns and those whose parents were unable to care for them. By the 1960s such large institutions were out of fashion and the Aberlour Orphanage closed. Residents transferred to smaller, communal family homes across Scotland. Now, we work with over 6,000 children, young people and families, employing 700 staff in over 40 services ranging from befriending and working with young runaways, teenage gangs, mothers with dependency issues, and the residential services which we were founded on. Our largest revenue stream comes from contractual work from local authorities, but this isn’t sufficient to cover the costs of running a major Scottish charitable organisation, which is why we run additional fundraising activities. We don’t have the resources some larger charities have, so we need to maintain a strong element of creativity in our fundraising. Increased partnership working is vital to this, and in Dundee, we’re pleased to be working collaboratively on a new early intervention project consisting of ourselves and three other children’s charities, capitalising on the opportunities that shared services can bring. Working with the City Council, the team will help families and young people before they get to crisis point, thus reducing the reliance on council services at a later stage and holding out the hope of large savings in the future for local and health authorities and other support organisations. Such partnerships may not be new, but in these challenging times they are critical if we are to continue providing high quality care and services. At the same time, we must continue developing partnerships with businesses and organisations which have mutually beneficial arrangements. With an increasing recognition of importance of Corporate Social Responsibility (CSR), there are real benefits of charitable
30 | IoD Scotland Autumn 2012
partnerships for all. More specifically, CSR/charitable partnerships open up a wealth of PR and marketing opportunities, and for staff it can really boost morale, foster a sense of team spirit and be good fun. For Aberlour, it means more, offering support in many forms, from financial contributions to access to industry expertise, participation in events and the provision of volunteers for a wide range of activities. Corporate support for the charitable sector is invaluable. Take the Olympics for example: tens of thousands of volunteers giving their time and expertise to put on a spectacular event. Imagine the effect it would have on the country if every employee in every business were to donate a couple of hours a month to charity! Aberlour is lucky to have benefitted from the support of some major organisations such as Microsoft, Aviva and The Prudential, each providing assistance in different ways: from painting and gardening at our residential services to marketing and campaign advice from practitioners leading their field. And while these are large, well-known organisations, we are just as grateful for the support we get from smaller companies and organisations throughout Scotland. But this is a two-way street, and we like to think that businesses can learn much from the charitable sector – a sector which is having to do more for less. Sadly, competition in the third sector will probably never be stiffer, and yet the collaborative spirit between charities with similar ethos and values, while not exactly new, is certainly revitalised and growing. Despite the circumstances, it’s encouraging to see that even though there is limited money available, more people and organisations are prepared to contribute both financially and in kind to improve the lives of Scotland’s children.
Want to know more? Aberlour Child Care Trust would be pleased to work with IoD members on their CSR programmes, which we believe would be a win/ win for all of us. Contact Ken at ken.dunbar@ aberlour.org.uk
Social issues & CSR
Helping offenders break the vicious circle A ground-breaking programme hopes to end the vicious circle that sees offenders leave prison with little chance of finding employment, heightening their chances of re-offending in the future
ould you sell sand in the Sahara or ice in the Arctic? If you are typical of our readership, then your ability to influence will be second to none. But could you sell the benefits of recruiting ex-offenders to your peers in business? That is the task being taken on by three social entrepreneurs who have set up a new, not-for-profit business called Recruit With Conviction Ltd. Director Richard Thomson is convincing in his assertions. “Entrepreneurship is synonymous with risk- taking and entrepreneurs take calculated risks only where the rewards for success outweigh the risks of failure.” “Our business model is to operate partly on a grants basis and partly on sale of training and consultancy services. In our case the rewards will not make us rich but the rewards for society will far outweigh the risks involved” Statistics published by the Ministry of Justice show that 1-in-3 benefit claimants have criminal records. Richard does not underestimate the enormity of his task. “We are not trying to establish a pity vote here. Clearly businesses need competitive advantages, especially in the current economic climate, and our message is clear – there is considerable untapped potential and talent among people with criminal records. Recruiters have problems overcoming obvious negative stereotypes which are associated with words like ex-offenders or prisoners, however the reality is different and many people with criminal convictions have a great attitude for work. Our job is to help recruiters deal with disclosure of criminal records properly which in turn lays good foundations for wider diversity issues.” “We need recruiters to understand that people are not defined by a criminal record and although it not a badge of honour, you rarely get an opportunity to find out about the worst side of any applicant’s character or history. Criminal record disclosure is not easy for applicants or recruiters but ironically in practice it has an opportunity to create a bond of trust. Businesses also need the
comfort of knowing where to turn to if they have difficulties or if things go wrong. If they have worked with us, then we will be there to help.” This is an opinion shared by Brian Roberston-Fern, who runs All Cleaned Up Scotland Ltd, a new industrial cleaning and clearance business. “I use the Recruit With Conviction model for the business and it has been very successful for me. I’ve recruited hard working and loyal staff who go the extra mile for our customers and the business.” Brian is a former prison officer and didn’t need convincing of the merits in employing ex-offenders. “When I worked in the prison service I regularly came across guys who had a real work ethic. There is no typical prisoner; they are just people who upon release are often desperate for employment and willing to work hard if they are given a chance. The most important thing I look for is a good work attitude, and I’ve found it.”
owever, the model can fit any size of business and entrepreneurs such as Sir Richard Branson and John Timpson have found success in recruiting ex-offenders and have publicly gone on record to ask other businesses to follow suit. Scottish Business in the Community (SBC) is also committed to working in partnership with the campaign. Veronica Ferguson, Head of programmes
at SBC said: “We are delighted to work in partnership with Recruit With Conviction to support the development and delivery of the project and we fully endorse the concept of providing support for businesses to work with people with offending histories. As an organisation, we believe it is important that businesses feel empowered to do this, and that they are challenged to consider how they could do it successfully – with the ultimate aim of supporting the employability and employment opportunities of this extremely disadvantaged group.” Like all other business decisions, there are no certainties of success in recruiting ex-offenders and like all other business decisions there are wider impacts which reverberate in the community and environment. In the case of recruiting an ex-offender, success is not only beneficial for your business but it also makes a significant reduction to the likelihood of that person re-offending by a factor of three. The Recruit With Conviction model draws on experience from working with Apex Scotland, a specialist organisation which supports offenders back to work. Richard was involved in a programme which delivered similar training and support to employers in the past and dovetails this experience with good practice research which has been produced by CIPD. Want to know more? See the blog www.recruitwithconviction. org, while businesses can support the campaign through sponsorship or by taking on training and consultancy for recruiters.
IoD Scotland Autumn 2012 | 31
Qualifications are changing
The Scottish Qualifications Authority has developed new National Qualifications to support Curriculum for Excellence. These will recognise and demonstrate the skills, knowledge and understanding young people have acquired at school or college, and help them adapt to further learning, training and employment.
For more information about the new National Qualifications and Curriculum for Excellence, visit www.sqa.org.uk/cfeforemployers