Sophie Chandauka, Virgin Money


Virgin Money’s Sophie Chandauka is ranked on the Power List of 100 most influential black Britons and co-founded the Black British Business Awards. As nominations for this year’s honours open, she talks about mergers, stockmarket flotations and board diversity

Sophie Chandauka has a lot to thank her school friend Andrea for. Chandauka was 15 and growing up in Zimbabwe when Andrea announced she was applying for a Rotary Club scholarship to study abroad for a year.

“At that age, you just want to get as far away from your parents as you can,” Chandauka jokes. She wanted to apply for a scholarship, too, but there was a snag – her father, unlike Andrea’s, wasn’t a member of the Rotary Club. “Andrea asked her dad for another form for me to fill in,” she explains.

That simple act would change the trajectory of Chandauka’s life and career. Chandauka won a place to study at a school in Ontario, Canada. (Andrea went to Michigan in the US.) The move was the start of an international education, which led first to a degree in politics and international relations, then a career as a corporate lawyer.

She has worked on mergers and acquisitions, including Macquarie’s controversial but failed £1.5bn bid for the London Stock Exchange in 2005. She is now head of group treasury (legal) at Virgin Money in London. Chandauka is also co-founder of the Black British Business Awards and is on the board of trustees of the charity Sentebale, which helps African children affected by Aids.

Director Last autumn you were involved in drafting the prospectus for the Virgin Money flotation. What advice would you offer companies planning an IPO?
SC First, step back and make sure this is right for you. Going to a stock exchange is about access to deeper pockets, but it’s a very different way of raising money. Being listed means complying with all sorts of continuing obligations. So if you want to raise a relatively small amount of cash, it may be better to raise it privately. Getting the valuation right is vital. If you get it wrong it can be embarrassing, as Royal Mail discovered.

Previously, you worked on Virgin Money’s acquisition of Northern Rock. Were there useful M&A lessons there for smaller businesses planning an acquisition?
It’s important to understand what you’re acquiring. For a small business, you should do your due diligence so you understand the businesses that are coming together. That means understanding the unique selling points as well as what you want to retain and what you could do away with in the enlarged business. Often in a small business you find people with multiple roles – for example, founder, director and employee. It’s important to manage conflicts of interest. Be clear that the right people are making the right decisions so that further down the line you don’t find yourself exposed to criticism for poor governance.

Northern Rock had its fair share of criticism. How can a business recover from such mistakes?
The board and management team must closely examine its governance and controls in order to avoid bad decisions in the future. A lot of that has to do with transparency within the business and escalation of issues as they arise. It’s about creating a culture where people feel free to speak and are empowered to raise a flag when issues occur. At Virgin Money we have that culture. It’s not an issue to put your hand up and say something needs to be looked at.

The financial services industry as a whole needs to regain public confidence after a string of scandals. How can it do that?
There is a major perception issue that needs to be corrected. As someone working in financial services, I would say there are a heck of a lot of good people who are credible experts and who work diligently and honestly every single day. But some really bad decisions have been made and the industry is paying the price for it. For me, good professional conduct, ethics and culture have got to be seriously enforced priorities of each and every institution. Leadership has to set the tone from the top. But financial services companies are often large and complex, so they should develop operating models which ensure the board can exercise proper oversight and make the management team accountable.

Your background as a lawyer gives you a forensic insight into these issues. Why did you get into corporate law?
I was born in Rhodesia, which soon became Zimbabwe, and I lived next door to apartheid during my early childhood. You can’t live in that part of the world and not think about what you’re going to do with your life. For my parents and me, law and justice were very topical. Then my education in Canada, Britain and the United States gave me more political and legal insight. My choice of commercial law was very pragmatic. I could have chosen to be a human rights lawyer or a diplomat in international relations. But I wanted to make more money as a corporate lawyer so that I could support younger relatives through their education. Making the switch from corporate to anything else in business or diplomacy would be easier as I would be armed with a strong commercial background. Every bonus I’ve ever made, I’ve invested back in the family. It turns out that I am a deal lawyer through and through, and I enjoy that, and so all is well that ends well!

What inspired you and Melanie Eusebe to found the Black British Business Awards?
Having lived in so many parts of the world – and as a member of an ethnic minority myself – I think the contribution that’s being made by black leaders in business needs to be shared more widely in Britain. A lot of people do believe that black people are not making a substantive contribution. That’s wrong. The Black British Business Awards are about raising the profile of black people who are making a huge contribution in business and who need a seat at the boardroom table. It’s about giving black people true economic participation and empowerment. We need to be able to control our own narrative so that a more positive image of black people is projected.

What do you think should be done to advance boardroom diversity?
People need to stop talking about it and just get on with it. If you are serious about diversity and recruiting the best talent, then you need to have a key performance indicator on your balanced scorecard – and you need to measure what success looks like. You can’t measure success if you don’t have some aspiration. We need a way to sponsor talent so that we have a pipeline which ensures good boardroom representation in the future. There needs to be an investment in board readiness – it’s not just about numbers.

You’ve helped to develop young people by mentoring them. How can others become effective mentors?
Mentoring is a two-way street. It’s not just about you telling someone what to do. It’s about listening and understanding who they are as individuals and what they want out of life. More often than not, the advice is really about navigating the challenges in any workplace. So it’s about organisational savviness and using your own experience to help the young person avoid the same mistakes you may have made. It does take time, and if you’re going to commit to being in someone’s life – like any other relationship – it has to be meaningful.

The nominations for this year’s Black British Business Awards open on 2 March

See Sophie Chandauka in interview

Name Sophie Chandauka
Role head of group treasury (legal), Virgin Money Group
Previous position senior associate in corporate finance team at Baker & McKenzie
Notable projects L’Oréal acquisition of The Body Shop; Nike acquisition of Umbro; Virgin Money acquisition of Northern Rock and IPO
Other interests Paul Harris Fellow of Rotary International for her work as a young ambassador for world peace and understanding

About author

Peter Bartram

Peter Bartram

Peter Bartram is probably the longest serving contributor to Director, having first written for the magazine in 1977. He is a prolific freelance journalist with more than 4,000 feature articles published in dozens of newspapers and magazines. He has written 21 books, including biography, current affairs and how-to titles, and has recently launched a crime mystery website.

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