Pathetic at sport, but on his marks for 2014

Published on Thursday 21 February 2008 20:58

AS ONE of the nation's industrial heavyweights, the lion's share of Sir Robert Smith's career has taken place in the Byzantine world of private equity, pioneering takeovers and rescue packages over the past four decades.

Having occupied a plethora of high-profile positions in the City – including his current chairmanship of the Weir Group and stints as chief executive of Morgan Grenfell, vice-chairman of Deutsche Asset Management and general manager of the Royal Bank of Scotland's corporate finance division – he has been on more boards than Sir John Gielgud.

In recent years, however, the Glasgow-born businessman has forged a reputation as a grandee of his home city and country, serving as national governor of BBC Scotland and chairman of the National Museums of Scotland.

Over the next six years, Sir Robert, who lives in Peebles, will chair the organising committee of the Glasgow 2014 Commonwealth Games. Essentially responsible for ensuring the prestigious event does not stray from the agreed timescale and budget, he hopes the Games will leave a long-lasting legacy.

Here, he tells The Scotsman about his formative schooldays, his confidence that the financial trouble at the heart of the London Olympics will not impact on Glasgow 2014, and, with tongue firmly in cheek, his belief that he could still pull on the jersey of his beloved Partick Thistle FC.

Q & A: SIR ROBERT SMITH

What do you think hosting the 2014 Commonwealth Games means for Glasgow and Scotland, and, as someone from Maryhill, how important is it for you to ensure they make a difference years after the event has finished?

I was born and brought up in Glasgow, and this is one of the biggest events Glasgow will ever have staged, so it's a very proud moment for me. I think I'll be taken outside and shot if I don't deliver a good Games or ensure the Commonwealth Games Federation feel it's been good from the point of view of athletes and in terms of its efficiency.

However, it would be a tremendous lost opportunity if we can't do something more than that. By legacy, we don't just mean the built legacy – a nice velodrome, a nice swimming pool – it's much more than that. If we can enthuse the youngsters of Glasgow, indeed of Scotland, feeling that they've got something to contribute as part of the 15,000 volunteers we need, it can be a lasting legacy for their lifestyles, leading to better health, less crime and so on.

You have said the responsibilities of your position are twofold: to deliver the Games on time and on budget. The London Olympics were originally budgeted at 1.8 billion but are now forecast to cost 9.35 billion, while the 2002 Manchester Games required an extra 105 million of government funding, and the 1986 Edinburgh Games posted a 3 million deficit. Is there not reason for scepticism, given the financial history of these kinds of events?

You can never be 100 per cent confident: this is six years away, and there's construction price elements around the world to consider. China is now using about half the world's cement and nearly a third of its iron and copper, so the costs could rise by the time of the Games. But I think the budget has been prepared pretty robustly.

Edinburgh only agreed to host the Games at the very last minute, and we're not like the Olympics in London, having to build a huge amount of infrastructure. Seventy per cent of everything we need is already in place. We're going to be using Ibrox, Celtic Park, Hampden, all sorts of places that already exist, and we're going to be creating mountain bike trails in the Cathkin Braes, but I don't imagine too much of an overrun there.

That's not to say it's not impossible that there will be some kind of overrun, but we're managing it very carefully, and we've budgeted very well for it.

Do you believe the spiralling costs of the Olympics in London will harm Glasgow's drive to attract the tens of millions of pounds in commercial sponsorship it needs?

Two years separate the two events, and that's a long time in sponsorship. There's some sponsorship issues being looked at just now, but the bulk of it will happen around the time of the Games.

The franchise is held by the Commonwealth Games Federation, so if we were going about just now actively seeking sponsors, the people running Delhi (host of the 2010 games] would have something to say. For us to be raising money from international companies and saying, "Hey, there's going to be broadcasting rights in 2014 – never mind Delhi, this will be a better opportunity", would wreck the whole thing.

We are doing some preliminary things, but issues like sponsorship are a no-go area until we get closer to the Games.

Alex Salmond has called for the injection of an additional 150 million of lottery money towards the Games to replace the amount of money being diverted from Scotland to the London Olympics. Is that a source of funding you believe should be pursued?

I always said when I started as chair I wouldn't answer political questions, but let me tackle that head on. Alex Salmond wants to raise a consultation around the area of legacy, and if we say lottery money is for that – and not for built structures – then he feels we ought to get that money. It would not be used for running tracks or swimming pools; they are already budgeted for. I think we can get money for the legacy side of things.

If we were to look back at the physical education report card from your days at Allan Glen's School in the 1950s, would it make impressive reading? Even after your schooldays, did you maintain an active sporting lifestyle?

Oh no, believe me, I was pathetic at sport. The Allan Glen's rugby team was pathetic, and I wasn't even good enough to get in. I played rugby down in England as well, but it was tackling around the eyebrows stuff.

I am not the Sebastian Coe of Scottish sport, though I could probably give him a run for his money now. He's probably thickened up a bit since he retired.

I've run a couple of marathons in later life, which was excellent, and I'm interested in shinty. I mentioned to Alex Salmond he should make it a Commonwealth Games sport, as we might win it in the first year before the other guys catch up – we export these sports all over the world, and once we give them away, we get beat at them. I'm a season-ticket holder at Partick Thistle, and there's better football played there than anywhere else. At least you can recognise the people there. Not on the park – they keep changing – but the spectators. Shout "Jimmy" and a Jimmy answers from the other side of the ground.

Like any normal bloke in Scotland, I like to see sports results come through, and follow pretty much any sport. But as a participant? No. I don't think that's a qualification for a job.

Would you forfeit all the achievements in your career to date for the chance to play for Partick Thistle?

I could play for Partick Thistle now, probably. No, I'll be the first to admit that I never made it, and I can say I was never likely to make it, and I can't say, I almost made it. I've been lucky to be a spectator.

Going back to your schooldays at Allan Glen's, it was a very prestigious school, and its former pupils have gone on to achieve great things. Did the fact you received a scholarship to go there subsequently inform your views, in terms of putting something back into civic life in Glasgow and Scotland?

I didn't think about it then. I just knew my parents didn't have to pay for me to go to a select school. There were rich boys there paying fees, but also quite a crowd of ragamuffins and characters who were all brainy. It was quite a forcing house. It produced a Nobel Prize winner, the current Lord Provost of Glasgow, all sorts of characters in engineering, medicine and science. The idea that I give back came later in life, and I do quite a wee bit now.

You are currently best known as chairman of the Weir Group, but have worked across an array of private and public organisations, including more than a half dozen non-executive directorships, four chairmanships and numerous other boardroom positions. What has been your proudest position to date in your career?

I've had two or three wee triumphs in business, and one or two disasters, too. I remember when I was starting out, and I was in a job which paid me 1,600 a year. I wasn't long there when I made an investment which lost the company 60,000. I remember thinking, "I'm going to have to work here for the next 40 years just to pay off my debt." But it quickly became clear it doesn't work like that.

At times in business I've done things where I haven't been entirely certain what the outcome would be, such as the takeover of MFI. No-one really knew what would happen as a deal of that scale hadn't been done before. Nowadays, of course, you get lots of young punks still in their 20s talking about multi-million-pound buyouts, but back then, it was all new – it was pioneering.

My main success in terms of business was probably rescuing the business fund managers Morgan Grenfell. There was the Peter Young scandal, and I had to go in amid tears and tantrums and build the business back up again. The press hated us, Deutsche Bank hated us and the staff hated themselves. If asked who they worked for, they'd say, "Oh, I'm kind of in the City." "Yeah, but who?" "Er, Morgan Grenfell." It cost Deutsche Bank 455 million, but we got that back, and the rest is history. I was scared, though. I was running 5,000 people, and I'd never run that number before. They were scattered all over the globe – Japan, New York, Singapore, Australia. I lost a bit of weight during that time, I can tell you. No-one knows how we did it, but we did.

And outside of business?

My proudest moment was probably as chairman of the National Museums of Scotland, because we brought in the Museum of Scotland (opened in Edinburgh in 1998] on time and on budget. It was very interesting, dealing with the return of human remains, building the museum, mixing with serious intellectuals. It leaves a wee mark on you.

Are there experiences from that position you think will come in useful during your tenure as chair of the Commonwealth Games Organising Committee?

I've managed large budgets and thousands of people, and dealt with things like attracting sponsorship, so the business side of things I'm confident about, given we'll have hundreds of staff, hopefully, and about 15,000 volunteers.

When I was at the National Museums of Scotland, I used language that the chairman of such a cultural institution should not use, dealing with architects, builders and so on. You had to do that.

Donald Dewar said to me, "You can ask for more money." I said, "I'm not doing that, it's going to be on budget." He said, "But this is the future of Scotland – you have to." I said, "I'm not. I'm chair of the trustees. We can bring this in."

I spoke to the architects who said that, if we took all the stone off the back of the building, underneath the roof garden, we could save 7 million. "Do it," I said.

To this day, an architect pal of mine says, "It's very clever, that design. The way it's open." No-one knows the real reason.

Were you to be a young man starting out in your career today, would you still go south to make your name, or do you think it is possible to forge a successful career in Scotland nowadays?

I'd still go down south. When I started out, people wouldn't say, "Go west, young man," but "go south". I don't think Alex Salmond will want me to say this, but I still agree with that. Of course, there are many more companies coming to Scotland now. You only have to look at the Royal Bank of Scotland's headquarters in Edinburgh, and a whole host of other major firms, to see you could live, work and die in Scotland if you wished. I made sure my children were schooled in Scotland, as I think it's important. I think there's definitely an advantage to be had from being Scottish, Irish or Welsh in Britain.

But would Denis Law have been happy playing for Aberdeen for all of his football career, instead of going to Manchester United and Italy? I think going to London presents you with more of a challenge, in finance especially. It gives you qualities you can take back to Scotland. You're up against young punks from the Bronx and people in Singapore, and you're able to say, "I beat them, I came above them."

Is that aggression something you consider vital to succeeding in business?

I don't know if aggression is the right word. Assertiveness is closer to the mark. It's a healthy attitude.

You own Inchmarnock, a small island to the west of Bute, which you bought from a distant relative of Richard Branson. It doesn't strike me as a particularly prudent investment for someone with a background in private equity, so is the island simply a way for you to unwind away from the cut and thrust of boardrooms?

When I bought it, my wife thought I was going through the male menopause, and my bank manager must have thought I was going mad, but it didn't cost as much as some islands are going for now, and it's a nice outside interest. It's the same as a vineyard I have now in South Africa – it's a nice thing to have.

I have Highland cattle on the island. I was advised by a man that they don't take much work, and tend to look after themselves. If I could find that man now, I'd sue him. But I'll sell a good few every year directly to consumers; I'm not interested in getting into Waitrose. I sold some recently to Sir Tom Hunter. We haggled a little over the price, but in the end I got a good deal. In the end, I let him know these rich folk have to try their best to subsidise the agricultural sector.