Twenty Questions: 'I lose my temper when people come at 5.30pm with bad news I should have had the day before'

1 You've spent 36 years working in insurance - so what's been the biggest change?

1 You've spent 36 years working in insurance - so what's been the biggest change?

When I joined in 1964 we used to do all the calculations on something called a "facit" machine, which was a huge slide rule, shaped like a cylinder and about two feet tall. The actuary department didn't get an electronic calculator until 1968, and when it arrived it was so big that half sat on my desk and half on my colleague's. Now the calculations are computerised and we're much more focused on the customer.

Thirty years ago, when we had all these high-powered people doing high-powered technical calculations with hand calculators, they tended to think calculations were the most important thing, not the customer. Today, many of our staff work in customer service because our customers want a first-class service.

2What's the first lesson you learned in business?

To trust your judgement, because you have to be able to live with your decisions long after you've made them. When I made the decision to downsize Scottish Widows in 1996, many people said it was impossible. I knew we were dealing with people losing their jobs and it had to be done in such a way that they were treated fairly and left with their dignity.

When you make a huge decision like that, you have to do it in a way that allows you to sleep at night.

3What single event or person gave you the impetus to succeed?

My parents sent me to a good school and always gave me great encouragement. They didn't pressure me into doing anything in particular, although I did think about becoming an accountant, like my father. In the end, I sat my first year's actuary exams while at school and found it so challenging I joined Scottish Widows rather than going to university.

4If you didn't run Scottish Widows, which company would you most like to run?

Marks & Spencer because it could do with a turnaround. The trick with managing a management team is to realise you've got problems long before they do. M&S didn't realise they needed to change until it was too late.

When things are going well and expanding, it's easy to sit back, but that's when you need to make changes, not when it's going badly.

5Do you have a business philosophy?

I'm a perfectionist, so "strive to be the best" is a very good business maxim.

6What was the best decision you have made, and the worst?

Last year's decision to become part of the Lloyds TSB group was one of our best because it put Scottish Widows in the top two in terms of market size and capability. Before joining the group nearly all our business was sold through the IFA channel, but now we can sell through LTSB, the IFA, direct sell and over the internet. We are uniquely placed because we have a multi-distribution capability.

My worst decision was in terms of not pushing something further when I had the opportunity. About four years ago, I was very keen for us to develop our e-commerce capabilities and I regret not pushing that hard enough at the time. We did good work, but not enough. We're only doing 1 per cent of our sales electronically and ideally we should be doing 15 per cent or more by now.

7Which single task do you hate doing the most?

I hate attending meetings that are just talking shops with no end result.

They are a waste of time, particularly when you know your in-tray is getting bigger for every minute you're sitting there.

8What was the happiest day of your working life, and the worst?

The happiest day was in September 1990 when the chairman told me I'd been appointed chief executive. The most miserable was in 1992 when Scottish Widows was fined by the regulators.

We had record-keeping issues, in that we'd given advice which we couldn't demonstrate conclusively. It's much more commonplace now to be fined but at the time it felt very uncomfortable for all of us at the company.

I felt I carried that burden more than anyone because I was chief executive.

9What's the best piece of advice anyone has given you?

It was from my predecessor who said: "Just remember that you've been given this job because the board believes in you, and trusts you above everyone else."

When I am in my darker days, it's nice to remember that.

10Are you easy to work for and what makes you lose your temper?

I'm reasonably demanding, but I like to think I'm tough but fair. I think it's very important to have an open management style and for the team to know what's in your mind. I probably shout a little less often than I used to in the early days as CEO. I tend to lose my temper when people come in at 5.30pm on a Friday with bad news, which they could have given me at 9am on Thursday. They say, "I didn't want to worry you at the time", then tell you something you can't do anything about because you have no time. That always hacks me off.

11What is your greatest personal indulgence?

Doing nothing.

12What kind of car do you drive and why?

A metallic-red Jaguar XJ8, because I think it's lovely.

13Public perception of the industry is very poor. Have you got any plans to improve consumer confidence?

We're conscious that public perception is poor, but the public forgets the industry plays a significant part in society. People don't want to think about making provisions for old age or dying, yet I've never met anyone who took out a pension plan, who is now retired and regrets it. I've also never met the dependents of a deceased breadwinner who regrets the life insurance policy they took out.

The industry does a huge amount of good, but it's also done things that aren't so good, which have impacted on public perception.

We are all involved in the Savings and Long-Term Risk Initiative (SALTR), a programme aimed at raising industry standards. We are trying to remove the mystique of what we do and make sure we provide people with appropriate products. We are also setting up an independent body to award accreditation and to monitor standards. It's a tremendous step for any industry to set these kinds of standards.

14Do you think the industry should compensate those customers who were poorly advised on their endowment mortgages?

There isn't a simple answer to what's happening. We are writing to everyone with an endowment policy and telling them the amount they can expect to get when their policy matures. Interest rates are lower than they have been for many years and we're only seeing a 6 per cent rate return per annum. A 25-year-old endowment policy will have earned 13 per cent per annum before tax.

Some people didn't realise there was a risk associated with an endowment mortgage, yet there is a risk associated with any mortgage in the sense that interest rates can go up or down.

I'm old enough to remember the 1970s when mortgage interest rates were going through the roof and people couldn't afford the repayments. Then along came the endowment package, which allowed them to buy their homes. I'm not saying some people weren't given the wrong advice, but, for many, an endowment mortgage was very sound advice.

15Who do you most respect in the industry?

Sandy Leitch, the chief executive of Zurich Financial Services. He's a great motivator and has been magnificent in delivering the SALTR initiative.

16If your briefcase were about to be confiscated, which three things would you retrieve?

My mobile phone, a packet of Nurofen for cold and flu and a rack of business papers.

17Are you pro-Europe and the single currency?

I'm a complete Euro schizophrenic. I can see some advantages in a single market, but I cannot see how all the countries in Europe can have identical economic needs.

18If not insurance, which other career would you have liked?

I really wanted to be a professional golfer, but I played at Carnoustie in my teens and that really put me off.

19Where do you want to be five years from now?

I'd like to be a non-executive director and polishing up my golf.

20 Do you ever think about retiring?

I don't have time to think about retiring.