BP Director To Chair Rolls-Royce
A former partner of McKinsey, the management consultancy, is poised to be named on Thursday as the next chairman of Rolls-Royce, the aircraft engine-maker.
I can reveal that Ian Davis, who sits on the board of BP, is to join the board of Rolls-Royce in the coming months. He is expected to replace Sir Simon Robertson as the chairman of Britain's most important manufacturing company following its annual meeting in May.
The appointment will end months of uncertainty about the leadership of Rolls-Royce after it became mired in corruption allegations relating to payments made by its subsidiaries in China and Indonesia.
Mr Davis's appointment is expected to be announced alongside a bumper set of full-year numbers from Rolls-Royce, which analysts say will have notched up about £1.4bn in annual profit last year.
Mr Davis is well-known to the Rolls-Royce board member who led the search for Sir Simon's successor. Iain Conn, the senior independent director at the aircraft engine-maker, is also the chief executive of BP's refining and marketing operation, and insiders said that Mr Davis had been in discussions with Rolls-Royce for several months about taking the job.
Sources said tonight that Rolls-Royce was unlikely to provide a detailed update on the progress of the corruption probes alongside its results.
Last month, it said it had appointed Lord Gold, the eminent City lawyer, "to lead a review of its compliance procedures, reporting to the Ethics Committee of the Board. This follows the previous announcement by Rolls-Royce that it has provided information to the Serious Fraud Office (SFO) relating to concerns about bribery and corruption involving intermediaries in overseas markets".
The corruption allegations have cast a shadow over Rolls-Royce, which has enjoyed a largely unblemished reputation even as its rapid expansion during the last decade saw it accelerate sales in fast-growing emerging markets in Asia.
Mr Davis will need to tackle the ongoing inquiries and build a strong relationship with John Rishton, the Rolls-Royce chief executive, who has only been in the job for about a year.
In addition to his role on the board of BP, Mr Davis sits on the board of Johnson & Johnson, the US pharmaceuticals group, and is a senior adviser to Apax Partners, the private equity firm. He is also a non-executive member of the board of the Cabinet Office.
Rolls-Royce today announced that it had struck a deal with the Ministry of Defence to supply nuclear propulsion technology to the military, a contract that it said would save the Government £200m and protect 2,000 British jobs.
The search for a new chairman was overseen by MWM Consulting, the boardroom headhunters.
Rolls-Royce declined to comment.