It’s time for a Boots boycott

June 10th, 2009

The main beneficiaries of Stefano Pessina’s decision to appoint Andy Hornby as chief executive of Alliance Boots will be rival chains Superdrug and Lloyds Pharmacies, and to a lesser extent the supermarket chains such as Tesco, Sainsbury’s, Morrisons and Asda, as customers vote with their feet and take their business elsewhere.

The Italian tycoon — along with private equity house Kolhberg Kravis Robrts and most of the British business commentariat — is clearly oblivious to the reputation that Hornby now has in this country. Has the Italian forgotten that, having destroyed at least two UK banks (HBOS and Lloyds TSB), Hornby is viewed with contempt by most of the UK population?

Some readers may be unaware of the sorts of things that Hornby condoned while he was HBOS’s chief executive between July 2006 and January 2009 (see Examining HBOS). The chicanery might, for all I know, have been the tip of  a much bigger iceberg (and correspondence that I’ve seen suggests Hornby was well aware these sort of things that were going on).

Unsurprisingly, given this extraordinary appointment, there is mounting pressure for a boycott of Boots. I, for one, do not intend to set foot in a Boots store until Hornby leaves the company — and have already cut up my Advantage card (By the way, I’ll miss it. I actually quite liked Boots and, until this appointment, regarded it as one of the more ethical retailers around.)

The consensus among business commentators is that it is perfectly acceptable for Hornby to be given a “second chance” and that the 42-year-old Bristolian will be so determined to clear his name that he is bound to lead Alliance Boots with he utmost integrity.

This is poppycock. If the failed banker had any integrity, he would have recognised his own shortcomings and refused to accept the chief executive’s role at HBOS when it was first offered to him in 2005. He would also presumably have taken some steps to rein in the dangerous excesses and  borderline criminality that had permeated HBOS by that time. Of course, Hornby a man so obsessed with selling he lost sight of almost everything else, did nothing of the sort.

The frequency and consistency with which the lines that Hornby “deserves a second chance” and has “apologised” for the error of his ways at HBOS (he doesn’t; he hasn’t) were repeated by business journalists in relation to Hornby in recent days suggests that one of the City’s more oleaginous spin doctors, Roland Rudd of Finsbury, may have had a role.

There are of course honourable exceptions — in terms of journalists who saw through the web of deceit — including the magazine Real Business and Alex Brummer, City editor of the Daily Mail. Brummer writes:

“For sheer chutzpah the decision of High Street chemist Boots to choose Andy Hornby, the failed and utterly discredited boss of Halifax Bank of Scotland, as its new chief executive takes some beating.” See: He’s destroyed three banks and cost us billions. Now he’s the £800,000 a year boss of Boots. What an outrage for taxpayers.

And Real Business asked some genuine entrepreneurs for their thoughts — specifically whether they would like to see failed banker Hornby take the helm at their businesses. Here’s how Mark Mason, chief executive of software development firm Mulaboo, responded:

“I suspect Andy Hornby is anathema to most entrepreneurs. Here’s a man who has worked his way up the corporate ladder, jumping ship every three years or so, to a position he was clearly unqualified to hold and seemingly unable to live up to. While most entrepreneurs live or die by their ability to make their businesses profitable, Hornby was rewarded by taking risks which were serving neither his business nor his customers.

And now, unbelievably, he has been rewarded again with a new role in another blue-chip organisation while many of his former employees are probably still out of work. What sort of role model does this give our young business people? How are we to rebuild a great business nation if failures are seen to succeed? It’s an utter joke.”

“I’m sure Hornby has some great contacts and many memberships to the right clubs but I wonder how the employees of Boots will feel when their salaries are cut or roles lost when Hornby has to start cost-cutting to pay for his exorbitant salary? And, more importantly, I wonder how Boots’ customers will feel?”

• To read Alex Brummer’s column on Hornby’s appointment, complete with 119 mainly apoplectic comments, click below: He’s destroyed three banks and cost us billions. Now he’s the £800,000-a-year boss of Boots. What an outrage for taxpayers
• See also Anthony Hilton’s column from Haymarket Publishing’s PR Week: Hornby happily rewrites history

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Posted by Ian Fraser on Jun 10 2009. Filed under Blog. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry