Daily Mail - 03.03.2020

Daily Mail, Tuesday, March 3, 2020^ Page 71

JACK Welch, who was credited with

transforming General Electric into

the world’s most valuable company,

has died at the age of 84.

The legendary businessman per-

sonified the so-called ‘cult of the CEO’

during the late 1990s boom, and

became a corporate leadership guru

in retirement.

Welch’s results-driven management

approach and hands-on style helped

GE turn a financial corner and sent its

share price soaring.

But some of the success came at the

expense of thousands of employees

who lost their jobs in Welch’s relent-

less efforts to cut costs and rid the

company of unprofitable businesses.

US President Donald Trump, pictured

with Welch above, led tributes. ‘There

was no corporate leader like “neu-

tron” Jack,’ he tweeted, ‘We made

wonderful deals together.’

In 1999, Fortune magazine named

him its manager of the century but

Welch found himself defending his

retirement compensation, which

included millions of dollars in bene-

fits, including unlimited personal use

of GE’s planes.

‘NeutroN’ jack welch,

legeNdary u.S. boSS, dieS

t

he race to develop a vac­

cine against the corona­

virus is heating up. In

Cambridge, researchers at

the university’s Infectious

Diseases Centre say work is ‘already

well under way’.

After further tests, they hope to send

the vaccine soon for pre­clinical trials

at Public health england.

In the US, Novavax has begun testing a

vaccine on animal models while the biotech

giant Gilead says human trials for its anti­

viral drug, Remdesivir, have begun.

here in the UK, Glaxosmithkline has

hooked up with China’s biopharma special­

ists, Clover, to help develop its protein­

based vaccine – Covid­19 S­Trimer – with

the aim that, if tested successfully, its

Chinese partner can produce large quanti­

ties of it.

Another 30 to 40 pharma labs, including

those at Sanofi and Johnson & Johnson,

are also working at breakneck speed on new

designs. Some appear overly optimistic.

Israeli scientists working at Migal, the Gali­

lee Research Institute, claim they have a

vaccine that could pass safety tests within

three months.

These breakthroughs are great. however,

even the most optimistic of scientists say it

will be at least a year before a vigorously

tested vaccine can be used on a mass scale

• in time for the next flu season, maybe.
  Until then, we will have to wait and see
  whether the mid­February outbreaks may
  have been the peak.
  Much will depend now on how govern­
  ments tackle the tricky issue of public
  health policy.
  If they take the doomsday scenario of
  lockdowns and self­isolation, the global
  short­term impact will be catastrophic. If
  just London goes into lockdown, the UK
  could be hit by a £10bn loss.
  The OeCD’s latest warning, that the epi­
  demic is the gravest threat to the global
  economy since the financial crisis, has con­
  firmed what many already feared. What’s
  more, if the virus is not contained, it pre­

dicts world GDP growth could be nearly

halved to 1.5pc with financial markets col­

lapsing by up to 20pc. Countries such as

Japan, Italy and Germany will be tipped

into recession.

This epidemic is particularly devastating

because the blow to confidence is hitting

both supply and demand, with supply

chains around the world gummed up.

You can see this from the Baltic Dry Index,

one of the best measures of global activity,

which looks at freight rates across the big

shipping routes.

Since September, it is down by 84pc. After

the 2008 crash, it fell 90pc.

Stock markets which suffered painful falls

last week, did respond positively to the

news that central banks promised to do

what it takes to protect financial and mon­

etary stability. That means interest rate

cuts and other measures to ease liquidity.

Investors should stay calm, for now.

The braver ones could try picking out

shares in the winning pharma companies:

one of the few positive antidotes to this

terrible scourge.

Hot water

The Quaker founders of Barclays would be

quaking in their strait­laced boots if they

could see what’s going on at their bank.

Chief executive Jes Staley is under attack

again over his ties to convicted paedophile,

the late Jeffrey epstein.

Staley is being investigated by the Finan­

cial Conduct Authority over the nature of

his links to epstein, a former JP Morgan

client. Now Staley is under pressure from

activist investor, Sherborne’s edward

Bramson, who wants him removed.

Bramson claims the board’s decision to

re­elect Staley at May’s annual meeting is

‘ill­advised’.

Bramson is right. Chairman Nigel higgins

needs to stop quaking too, and step up his

authority. This could be done by announc­

ing Staley will retire at some future date,

and that succession planning is in place.

While the American has done a decent job,

he has a habit of landing in hot water.

Staley was fined more than £1.1m in a

peculiar attempt to unmask a whistle­

blower, prompting Barclays to claw back

£500,000 of his bonus. The link to epstein is

one bizarre incident too many.

A sad choice

TODAY is D­Day for Sirius investors. The

80,000 or so small investors in the Yorkshire

potash mine have to vote on whether to

take the money from Anglo American or

risk Sirius going bust.

Many local investors have lost life savings.

It’s a sad choice, but a bird in the hand is

worth two in the bush.

keep the faith in pharma

barclays urged

to fire Staley

over epstein

The biggest shareholder in

Barclays has urged the bank

to fire boss Jes Staley over

h i s l i n k s t o p a e d o p h i l e

Jeffrey epstein.

US activist ed Bramson, who

owns 5.8pc of Barclays through

his hedge fund Sherborne

Investors, warned that re­

electing Staley as chief execu­

tive at its annual meeting in

May would be ‘extremely

ill ­advised’.

he called on chairman Nigel

higgins ‘to draw a line under

this destabilising situation,

which has become a circus, as

soon as possible’, adding that

any attempt to allow the US

banker to slip gracefully into

retirement ‘would be a mis­

take and would set a terrible

precedent for Barclays and for

United Kingdom public com­

panies in general’.

Barclays last month revealed

that Staley, 63, was being

investigated by the Financial

C o n d u c t A u t h o r i t y o v e r

whether he had been open

with his employer about his

link to epstein.

The Barclays boss went to

visit epstein in Florida in 2008

while he was serving his 13­

month sentence for child sex

offences, and later joined him

at his Caribbean retreat.

Staley first met epstein in

2000 when he became head of

JP Morgan’s private bank,

where epstein was a client.

The US bank continued to

work with epstein until 2013 –

even after he pleaded guilty to

soliciting prostitution from an

underage girl in 2008. Staley

has said he deeply regrets

the relationship.

epstein committed suicide

in jail last year as he awaited

further charges. But Bramson

has now raised questions over

what Staley knew about the

paedophile’s illegal activities.

Bramson pointed out that

‘prostitution and sex traffick­

ing, by their very nature,

involve the transfer of money’.

he added: ‘Given epstein’s

history of involvement in child

prostitution, it would be rea­

sonable to expect that JP Mor­

gan would have placed his

accounts under close scrutiny.

We do not know if any reports

were made, but, if they were

not, it raises obvious questions

and, if they were, why were the

accounts not closed?’

Bramson questioned whether

Staley maintained epstein as

a client because of the profits

he brought, and the benefits

which this lent Staley in terms

of pay and promotion.

The whole affair throws Sta­

ley’s professional conduct into

significant doubt, he added.

Bramson said: ‘The real issue

is Staley’s professional conduct,

not the dubious company he

may have elected to keep.’

Barclays should also launch

a review into advice it received

over Staley’s appointment,

Bramson said, from JP Mor­

gan and recruitment company

Spencer Stuart.

The lender declined to com­

ment, but has maintained it

fully supports Staley.

Bramson’s criticism is the

latest salvo in a battle between

the activist and the Barclays

board. Shares in Barclays slid

3.7pc, or 5.44p, to 143.3p.

by Lucy White

Maggie

Pagano

Steel deal days away

The Chinese takeover of

British Steel should com­

plete next week, following

months of nervous waiting

for its workers.

Jingye’s £50m purchase

will take legal effect on

Monday, with 3,700 staff

asked to sign new contracts

before the changes. But

another 400 will lose their

jobs on the same day.

It comes ten months after

British Steel collapsed, with

the firm kept afloat only by

state support.

Jingye first emerged as a

potential buyer in Novem­

ber after Turkish pension

fund Ataer walked away.

The Chinese firm has

p r o m i s e d i t w i l l p u m p

£1.2bn into the business to

turn it around.

Some 20,000 supply chain

jobs rely on British Steel.

LEKOIL has hit out at its

consultant after it was

scammed out of £351,000

after believing the Qatari

sovereign wealth fund

would lend it £144m.

The London-listed oil firm

said it hired an unnamed

‘third-party global risk

consultant’ to look into

Seawave Invest, which

introduced it to ‘individu-

als falsely purporting to

represent’ the QIA fund.

However, it claimed that

an ‘inadequate’ due dili-

gence report did not raise

obvious red flags.

‘The fraud should have

been capable of being

detected,’ it added.

Lekoil said it has now

taken steps to recover the

fee paid to Seawave.

NeW rules on funding com­

p a n y p e n s i o n s c h e m e s

proposed by the Pensions

R e g u l a t o r r i s k h u r t i n g

e m p l o y e e s a n d s a v e r s ,

experts have warned.

The rules aim to enforce a

tighter legal framework on

how much companies must

pay in and shorten deficit

reduction time.

T h e s u g g e s t i o n s a r e

designed to make sure pen­

sion schemes actually pay

out. But pension consul­

tancy LCP believes the rules

could force many compa­

nies to close their schemes.

J o n a t h a n C a m f i e l d , a

partner at LCP, said: ‘Some

employers are likely to see a

significant increase in the

amount they have to con­

tribute, and the combined

bill for UK plc is likely to

run into billions.’

Lekoil anger over scam Pension shake-up fear