As he approaches his 70th year, the much-decorated Baron Smith of Kelvin, could now be a retired English teacher, indulging a passion for antique books and the cherished company of extended family.
Instead, a quirk of fate ensures that the son of a military father from Glasgow’s Maryhill, is preparing for two massive challenges: running the UK government-backed Green Investment Bank headquartered in Edinburgh and overseeing Glasgow’s 2014 Commonwealth Games.
Lord Smith is regarded as among the safest pair of hands of his generation. He is the establishment’s go-to guy when they need a bank set-up, a museum built or an international sporting event organised. Retirement is out of the question.
Educated by bursary at Allan Glen’s, Lord Smith owes his current standing to the fact that he failed English Language and Literature exams at Glasgow University. That stymied his English degree course aspirations, steering him towards economics instead and a career in accountancy.
For the then plain Robert Smith it was the stuff of happy accident.
He says: “I was teetotal, I had a steady girlfriend. To this day I have no idea what happened in that exam room but whatever it was it was the best mistake I ever made. My mother didn’t think so and she considered me to be an underachiever thereafter – even when I began to get wider public recognition.
“She’d set her heart on me teaching English. It is a real source of regret that she wasn’t around to see me receive my knighthood.”
It is 50 years since Lord Smith earned his universal business grounding elbows-deep in the balance sheets of the butchers, bakers and fish and chip makers of the then small business specialist accountants Robb Ferguson and Co in Glasgow. In that 50 years, few, If any, Scottish public figures have shaped their times in such profound, and so diverse, a fashion.
The current chairman of The UK Green Investment Bank, is also Chairman of Glasgow’s 2014 Commonwealth Games Organising Committee, Chancellor of the University of Strathclyde and a bigwig at both SSE and The Weir Group and an Independent Crossbench Peer knighted for his services to The National Museums of Scotland.
It is the same consistent approach he’s taken to the toffs of Sussex Heritage Trust in the 70s as he applied as president of the Institute of Chartered Accountants of Scotland, Chief Executive of Deutsche Asset Management, Chairman of The BBC’s Children In Need appeal and non-exec roles at Stakis, Bank of Scotland, MFI, Network Rail, Aegon and as a pre-Trust BBC Governor.
He says: “I am a very quick learner, and the more I’ve worked in different roles, the more I’ve been able to bring different people and different strands of experience from different sectors together. My talent is to bring a fresh eye to each role I’ve undertaken.”
Nonetheless a CV spanning almost 60 significant entries in 50 years for chairmanships, directorships, executive posts, awards and honorary positions could be construed as both a talent spread too thinly and the supreme product of networking over substance.
It would be a fair point but for the fact that Lord Smith can point from his Green Investment Bank office window across the Edinburgh skyline to the National Museum for Scotland, an architectural treasure, and a much-loved totem of national cultural life which he brought into being on time and on budget.
Equally he can reel off figures for deals that effectively created the concept of management buy-outs in this country. They reached their zenith with his 1987 MFI buy-out that raised £750m external investment funding for the furniture retailer at a point where £150m would have been a realistic norm.
These are tangible, measureable achievements that fly in the face of current corporate orthodoxies and Lord Smith believes that there should be space for those motivated by a spirit of vocation in an era of micro-managed, rigid careers.
He says: “The instinct is for specialisation but I’ve always believed that, as long as you have a grasp of the numbers, the fundamentals in any business situation, then your variety of experience can actually produce far better ideas. Whenever I manage people, I always tell them to broaden their experience, volunteer for things, push themselves outside their comfort zone.”
Lord Smith’s current roles at The Green Investment Bank and The Commonwealth Games provide a neat symmetry for a career come full circle.The Commonwealth Games has given him a ‘once in a lifetime chance to shape an international event in his home city’.
The Green Investment Bank role recalls his first major position at Industrial and Commercial Finance Corporation (ICFC), the Bank of England-funded ‘social bank’ created in 1945 to provide intervention funding for ambitious small and medium sized businesses.
That business became 3i, the private equity and venture capital multinational that Lord Smith returned to as a non-exec director between 2004-2009.
He says: “The ICFC was created to tackle a glaring market failure in post-war Britain. Now we have a similar market failure in managing our transition to a low carbon economy. We need to see an investment of £200bn in green infrastructure in the next decade if we are to achieve our climate change targets. Investment levels are half that currently. We need to get greener, quicker.
The government is getting the ball rolling but there is an opportunity here for huge growth in a new asset class; investments that are both green and profitable. Long-dated capital like pension funds and sovereign wealth funds will move in where there is a profit to be made from socially responsible innovation. This bank will help to jump-start that process.”
“ICFC created a business model that was so successful that it was imitated by a number of other private sector banks, increasing its impact exponentially. That’s a trick I hope to see repeated with GIB.”
Reproduced with thanks to Scottish Financial News.