Steve Rowe’s pay packet as he departs Marks and Spencer is, unsurprisingly, the subject of plenty of commentary. He’s walking into the sunset with £2.6m for his last year of work, a sum that set against an ongoing cost-of-living crisis in the rest of the economy will always raise eyebrows. Yet Rowe has earned every pound and penny of it.
When he took the reins six years ago, M&S had an identity crisis. Distinctly overweight, it couldn’t decide whether it was a food retailer, a clothes retailer or both, nor had it remotely cracked the online world. His first call with analysts – in which he said “consumer confidence has dipped, the clothing market is flat, online sales have slowed and there’s deflation in the food market” – was hardly reason for optimism.
Yet as he walks away from the retailer, his focus on “Mrs M&S” appears to have worked. Pre-tax profit last year of just shy of £400m is testament to the growth path Marks and Sparks is now on. In short, the Millwall fan who started his career on the shopfloor at M&S in Croydon, has done his job. British businesses are in their best shape when they reward strong performance.
The question now is where his successors take the business. The bonus pot – a cool £15m for the firm’s top three bosses – is certainly eye-catching.
However they fare, it is hard to imagine any of them overseeing a worse few months than JD Sports. The sportswear retailer which quietly became a global phenomenon in the past decade is now the subject of its second ticking off from the competition watchdog in a few months, and its internal governance being rightly questioned after its erstwhile CEO Peter Cowgill left with no notice whatsoever after almost two decades at the top.
A fortnight ago the firm said the “process to recruit a chief executive officer remains ongoing.” Some may find the challenge appealing. After all, turning that ship around would be worthy of a tidy bonus.