Home news The enviable business record of Richard Cousins

The enviable business record of Richard Cousins

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Richard Cousins was the sort of man who liked the companies he ran to do his talking.

He never did TV interviews and, when he did speak to newspapers, it was always about the business and, apart from the occasional reference to his passion for cricket, never about him.
That Mr Cousins was an exceptional businessman, though, is beyond dispute.
The average FTSE-100 chief executive has a tenure of around four and a half years.

Image: Dominic Blakemore has succeeded Mr Cousins as Compass chief executive
Yet at two companies, the plasterboard manufacturer BPB and Compass, the world’s biggest contract caterer, Mr Cousins notched up almost 18 years.
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During that time, he created billions of pounds worth of wealth for his shareholders.
At BPB, the shares were just 290p when, aged just 40, he took the helm in April 2000. When, six years later, he sold the company for £3.9bn to Saint-Gobain, he had the persuaded the French building materials giant to pay 775p each for them, compared with its original offer of 675p.

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Mr Cousins had, as one analyst noted at the time, “got a really, really good price” for his shareholders.
His achievement at Compass, if anything, was even better. The shares were priced at just 235.25p when, in March 2006, it was announced that he was to be the new CEO.
They ended 2017 at 1600p. Shareholders who stuck with Mr Cousins for the ride did not only enjoy that remarkable capital gain, however.

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They also received £9bn via dividends and share buy-backs during his time at the helm, with total shareholder return in the period was 940.3%, compared with just 107% for the FTSE All-Share Index.
It is no exaggeration, in the words of the former Compass communications director Chris King, that the business “was on its knees” when Mr Cousins became CEO.
His predecessor, Mike Bailey, had been bedevilled by criticism of Compass’s school dinners – and its notorious turkey twizzlers – by the celebrity chef Jamie Oliver.
The company was also accused of corruption in the winning of contacts to feed UN troops in Liberia. And, operationally, it was in patchy shape too.

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Bought out of the old conglomerate Grand Metropolitan in 1987 by a management team led by Mr Bailey’s mentor, Sir Francis Mackay, Compass expanded rapidly from a business turning over just £250m a year to one turning over £12bn.
Yet this had seen break-neck expansion and, what felt at the time, like growth for the sake of it – what the City calls “flag-planting” – which had taken the company into almost 100 countries around the world.
In short, it was in too many countries and had too many contracts that were not sufficiently profitable, while the balance sheet was under strain from too many expansionary acquisitions.

Mr Cousins’s solution was to pull out of more than 30 countries where Compass lacked either scale or was not making sufficient profits.

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He also offloaded a number of businesses, including Selecta, a vending business; SSP, the travel concessions found at airports and stations everywhere; and Moto, the motorway services business.
Complexity was also reduced by cutting the number of products bought by the business from 40,000 to 5,000 – giving it more bulk-buying power.
It is now that rare beast – a British business that is a world leader in its field and that serves a staggering 5 billion meals each year to people in their place of work, to students in schools, patients in hospitals and to inmates in prisons.
Mr Cousins cared deeply about the image of the business in which Compass was in.
One of his first moves was to remove turkey twizzlers from the menu of schools where Compass provided the meals and, for years afterwards, berated journalists who continued to link the company’s name to the dish.
He also complained about the use of the term ‘canteen’, arguing that “pie and chips in a canteen is a sort of 1950s concept”, adding “we have to produce really high quality food now”.
He was also passionate about dispelling myths about catering, such as the notion that it is a low-skill industry, pointing out that Compass employed thousands of dieticians and nutritionists around the world and that it had set up junior chef’s academies.
And he was also fiercely principled: he resigned from the board of Tesco last year in protest at its takeover of the cash-and-carry operator Booker – something seldom done by non-executive directors.
Tragically, Mr Cousins was about to enter the next phase of his life, and a more relaxing one.
His wife of 32 years, Caroline, a schoolteacher, died in August 2015 just six weeks after having been diagnosed with stage four cancer.
Before her passing, she is said to have urged him to find a new partner, which he did 18 months ago in the form of Emma Bowden, a talented publishing executive who, with her daughter Heather, also perished with Mr Cousins and his sons in the seaplane crash in Sydney on New Year’s Eve.
He was due to retire from Compass at the end of March this year and he and Ms Bowden are said to have sent out wedding invitations shortly before travelling to Australia.
Mr Cousins, a tough operator who did not suffer fools gladly, was an intensely private man. While his work made him wealthy, he always insisted money was “not much” of a motivating factor to him. At the time of his death, he was understood to be planning ventures in the charitable sector for the next phase of his career.
One aspect of his private life Mr Cousins was always happy to discuss, though, was his love of cricket.

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He was a member of all 18 first class counties, collected copies of the annual Wisden Cricketer’s Almanack and opened the batting for his village side of Hyde Heath near Amersham in Buckinghamshire.
He and his family were in Australia to take in the Ashes series and, appropriately, there will be a minute’s silence for them before the start of the Fifth Test at the Sydney Cricket Ground on Wednesday.

Source: SKY