LONDON BRIEFING:DID HE jump or was he pushed? The conspiracy theorists have been working overtime in the wake of the announcement by Asda that its boss, Andy Bond, is to stand down as chief executive.
After five years at the helm, Bond is moving “upstairs” to a part-time role as chairman of the company’s executive committee.
Although the news was played down both by the company and Bond, it shocked the City. If Asda had its own stock market quote, rather than being part of the giant US retailer Wal-Mart, there’s little doubt that its shares would have tumbled. Retail analysts were stunned – there had been no talk of a change at the top and they were all due to travel to Asda’s Leeds headquarters tomorrow for a long-planned strategy update from Bond. Bond will go ahead with the meeting, although he will clearly face a very different set of questions from the ones the City scribblers were planning; notably, why is he quitting and who will take over his job?
He won’t be able to answer the second question, although Asda is expected to move swiftly in naming its new chief. An internal candidate is seen as the most likely choice, with front-runners including chief operational officer Andy Clarke and finance director Judith McKenna.
Surprise departures of chief executives rarely bode well for a company and there was immediate speculation that Bond could be paying the price for Asda’s lacklustre performance over the Christmas period.
At the time, Bond admitted that Asda had relied too heavily on “bogoffs” – buy one get one free offers – and other promotions. In future, he said, the focus would switch to everyday low pricing, which customers seem to prefer when household budgets are tight.
Christmas may have been disappointing but it was far from a disaster, and it seems an unlikely reason for Asda’s Wal-Mart masters in Arkansas to dump their well-respected British chief.
There have been reports of tensions between the US parent and its UK arm, notably on the supposed lack of funds for Asda to make a major takeover move, although these were denied by all sides. Asda has been rumoured to be casting its eye over Home Retail Group, which owns Argos, and Bond’s departure sparked an inventive but somewhat unlikely theory that Wal-Mart planned to move on Home Retail as a way to install its boss, Terry Duddy, as Asda’s new chief executive.
Bond, who has been at Asda for 16 years, seems still to be on good terms with Wal-Mart. He will be moving to the newly created role of chairman three days a week once his successor is in place.
The suddenness of Bond’s decision mirrors the abrupt departure of his predecessor, Tony DeNunzio, another Asda veteran, five years ago. DeNunzio left after Asda failed to meet its earnings targets and was replaced by Bond within a week. DeNunzio quit to make his fortune in private equity – as have other senior Asda executives – and it could be that Bond plans to follow that path.
Still only 45, he is well thought of in the retail industry and was seen as a serious contender for the top job at Marks Spencer, a post filled by Marc Bolland.
Bond played down suggestions that he’s seeking a top plc role, saying instead that he’d prefer to “go plural”, taking on a number of positions. He may well be happy to remain as part-time chairman while pursuing his new plural career path but it would be a shame to see Bond’s full-time talents lost to the wider retail sector. He will certainly not be short of offers.
Fiona Walsh writes for the Guardiannewspaper in London
