Over four decades the career of Lord Allen – winner of Director’s Lifetime Achievement award at the IoD Director of the Year Awards – has spanned sectors from hospitality to broadcasting, including turning ITV into one company. Now Global Radio chairman, he talks here about Brexit, boardrooms and the BBC
When Charles Allen was 14 years old in Holytown, Lanarkshire, his world was rocked by the death of his father, a hairdresser and the family breadwinner. Watching his widowed mother in her fifties go out to work for the first time serving lunches in the British Steel dining room would not only affect his immediate future – a costly university education was out of the question – but also drive him to climb the corporate ladder through fear of failing.
“We went from being comfortably well off to having no money,” recalls Lord Allen as we catch up a week after he was honoured with Director’s Lifetime Achievement award. “It’s been an amazing journey considering I left school at 17 with no job to go to,” he reflects.
He has his mother to thank for his first job as a trainee management accountant. “Nepotism was alive and well,” he says, recounting how, while serving pudding, she overheard the personnel director talking over lunch about creating a pre-graduate programme. “‘Our Charles is a bright young boy, you interview him,’ she said.” It would mark the start of an ascent that saw Allen achieve his promise to her of becoming a managing director (of Compass Vending) by the age of 30 two years early. Yet behind the rising star’s glow, anxieties remained. “I was always anxious that I’d never gone to university. I was pretty embarrassed and would avoid that question. If asked, I’d say I was educated in Scotland…”
Coming to terms with his sexuality in the corporate world and a late diagnosis of dyslexia played heavy too. “I learnt you have to embrace whatever your fears are. We all have our anxieties but you need to face them to become more authentic to people. I’m probably more driven by the fear of failure than the need for success but if there are two opportunities I’ll tend to take the more difficult one.”
He cites the move in 1991 from chief executive of Granada Group’s leisure business Compass Group to the television arm, a year after the broadcaster had paid £9m in the auction to retain the ITV franchise in the north-west.
“They moved from being quite profitable to loss-making. I told [Sir] Gerry Robinson, who was chief executive of the Granada Group, that I’d love a crack at it. I’d never been in a television studio in my life and rather surprisingly he said he’d like me to do it. It took us a year to turn it around.”
Allen predicted that an ITV network formed of 15 regional companies, each with their own culture and identity was unsustainable. “We were literally buying companies every year. The culture at Granada was different to the culture of Yorkshire Television, which was completely different to LWT. These were companies that had battled each other [for slots in the ITV schedule] for decades. Bringing them together was one of the great challenges. I loved it.”
Making corporate history
By the late 1990s the ITV network in England and Wales was in the hands of a big three – Granada, Carlton and United News & Media – but the new millennium presented Allen with what, he says, could have been the biggest “down” in his career. “I woke up one morning to the news that Carlton and United were going to come together. It would have given them 60 per cent of the network. I was in the car travelling to the City with Gerry [Robinson] and thought we’d lost the game.
“We started to chat. I said to him, ‘maybe we can unbundle this from a regulation perspective’. We did something that was unheard of; four days later we announced we were going to bid for either Carlton or United Media, and we didn’t need to specify which one. It had never been heard of in corporate history and effectively that threw the whole thing into a regulatory review in terms of competition. It concluded that we could bid for either Carlton or United but they couldn’t come together.”
Granada acquired Anglia and Meridian from United. By 2003 it merged with Carlton; Granada taking 68 per cent of the new ITV plc with Allen remaining as chief executive for another four years.
After leaving a top FTSE 100 company, how did he adapt to the role of chair? “In my role as chairman I am the mentor and the tormentor to the chief executive and the board,” he says. “I am there to support them, ask them to look at things again, get things on the agenda but I’m not there to make decisions. The thing to remember when you’re a chair is, you’re not the chief executive. You are not running the company, the chief executive is.”
A two-year stint advising the Home Office on the restructure that saw the creation of the Ministry of Justice – plus seeing through the London 2012 Olympics that he’d been involved with from the start – helped Allen from the role of “player manager to coach manager”. He made a deliberate decision to include a wide portfolio of multi-sector chairmanships. “You want a busy chair because if a chair has got too much time on their hands they will interfere,” he advises other directors.
Boardroom diversity is something he feels strongly about. He has brought women on to the boards of both ISS and 2 Sisters Food Group. “You’ve got to do more than just be passive otherwise it won’t happen. It changes the dynamic of the boardroom… At ISS we ensure that for every key position a woman has to be on the shortlist. That’s not about quotas; they may or may not get it, but they need to be on the shortlist. You need to create that opportunity.”
At Global Radio, where Allen worked with private investors to buy Chrysalis Radio, GCap Media and GMG Radio to create a national network of independent brands including Capital, Classic FM and Heart, the mission statement has been replaced with an obsession statement that defines the behaviours and values.
Meeting people on the frontline gives him a buzz. “I’ve always worked in people businesses. Because I started at the bottom I remember to treat people how I want to be treated. The top four people are genuinely obsessive compulsives about culture and strategy… We created 40 ‘obsessive compulsive disorderlies’ – from the doorman at our office to the managing director of one of our radio stations – who are the embodiment of what the company’s about. We want them to be obsessive [about the business]. We sit down regularly to listen to them… to embrace their challenges and embody them into the culture…
“You can learn so much from listening. Within minutes of stepping into a hotel, factory, radio station, you can smell if their leadership are on the ball and by chatting to those on the frontline you get an honest response – good or bad.”
Support for Europe
In 2013, Allen was created a life peer, taking the title Baron Allen of Kensington. At the House of Lords he’s still learning the ropes on the Labour benches. Our interview took place during the week the Lords rejected the government bill to cut tax credits.
“It hadn’t taken into account the impact on people working in factories or call centres. The Labour party wasn’t challenging the principle of reducing benefits. The party was challenging the implementation and unintended consequences. The Conservatives said eight out of 10 families will be better off by 2020. But the ones that are worse off will be terribly worse off. If you are on the living wage and you are a single parent with two children, and you lose £500 a year, that’s massive. My mum was a single parent who literally had no money. I understood what that felt like.”
On the Europe issue, Allen is adamant that the UK should remain inside the EU. Companies, he says, need to be clear on the impact of an exit. “Not enough companies put it on the board agenda. If we think that by stepping outside there will be less regulation, we will have to be confined to European legislation to sell our goods and services there. This idea that we can go off and do our own negotiations with America or China is folly. If I’m a Chinese company I will want to come to somewhere from where I can operate across Europe.
“I don’t think people have seriously thought it through. Yes, I think the bureaucracy needs to be tightened but we’re better off doing that inside [the EU]. We’re deregulatory by nature. Directors need to be more vocal and articulate why for each and every business this [exit] could be damaging for business. The protracted period is stopping global businesses making investment decisions because of the uncertainty. It is really important for companies, for managing directors, chief executives and directors of companies to be really clear about why this is bad news for them. If we’re not in the EU, trade will become increasingly more difficult.”
Another political football is the future of the BBC. With its charter up for renewal in 2017 and Allen having spent most of his career in competition with the corporation, what does he think should happen?
“A strong BBC is important, but the BBC Trust is flawed. How can you be champion and regulator? How can the chairman of the BBC be the chairman of the trust? It’s an impossible task.” He would like to see a unitary board of management including the director general and non-execs being responsible for governance, with regulation passed to Ofcom. “The BBC and some of its programming is the envy of the world – it just needs to be a properly governed, properly regulated and properly funded BBC.
“The licence needs to be explicit in terms of what do we really want Radio 1, Radio 2, Radio 3 to be, with less aping of the commercial sector… [But] the idea that the BBC shouldn’t be showing popular programmes like Strictly Come Dancing is folly. That’s politicians getting involved to a level that they absolutely shouldn’t. The public want that [programming] and this is a public service. If you marginalised the BBC to documentaries, you wouldn’t get the viewership.”
On the prospect of being marginalised, does Allen think business can be confident of Labour under Jeremy Corbyn? “The party needs to reach out to business and not wait to be asked. It’s important that politicians listen. They may or may not agree with some of the things we do as business people but the least they can do is listen. If they disagree with us, they need to articulate why – and that dialogue is between business and any party, whether in power or opposition. It’s an important bridge to cross.”
It will be one that the business world will be watching closely.
Lord Allen of Kensington CV
2012- The Join In Trust
2011- 2 Sisters Food Group
2007- Global Radio Group
2015- Advisory chair, Moelis & Company
Previous notable roles
2012-2013 Chairman, British Red Cross
2008–2015 Senior adviser, Goldman Sachs
2008–2013 Non-executive director, Virgin Media
2008–2010 Executive chairman, EMI Music Group
2006–2013 Vice-chair, Locog
2004–2007 Chief executive, ITV
2000–2004 Executive chairman, Granada Media
2000–2003 Chairman, 2002 Commonwealth Games
1996–2000 Group chief executive, Granada Group
1995–1996 Chief operating officer, Granada Group
1991–1995 Divisional chairman and CEO (Television, leisure & services), Granada Group
1988–1991 Chief executive, Compass Group
2013 Ennobled as a Labour peer
2012 Awarded Order of Merit by IoC
2012 Honoured with a CBE
Lord Allen is a member of IoD London