Allan Leighton does not regard the upcoming vote on political donations to the Co-operative party as his main priority after becoming chairman of the Co-operative Group.
Instead his focus is on the businesses the loss-making mutual still owns – primarily supermarkets and funeral homes – after last year’s disposal programme which raised cash and kept the Manchester-based group’s bankers at bay. The group, which once boasted a presence in every postcode in the UK, sold off its farms, pharmacies and security business in the wake of the £1.4bn hole in its banking operations. It now owns just a 20% stake in the bank, which is majority owned by hedge funds.
The group, which lost £2.5bn in 2013, returned to profit at the half-year stage, and Leighton’s focus will be on resuming profitable growth from businesses which remain after the shrinkage exercise.
As a former boss of the supermarket chain Asda, Leighton is expected to bring an expert eye to the Co-op’s grocery arm. Richard Pennycook, appointed chief executive in September, has already earmarked 200 large food stores for closure in the coming years. The focus, instead, will be on convenience stores.
But as the first independent chairman, Leighton’s appointment marks a key stage in the overhaul of the Co-op. He will also have to attract recruits for the new-look board. New non-executive directors need to be named and the members of the Co-op will also elect four members to the board at the annual meeting in May. He will hope to avoid the infighting caused by the arrival of new management in the past.
The reputation of the group will also be a priority. He said that there was a groundswell of support to push through the changes that members endorsed at last year’s annual meeting.
