People

Logica CEO stands down

Martin Read is to retire as chief executive of LogicaCMG as a result of the IT group issuing a profits warning. Logica said it has had a succession planning process in place for some time, but was accelerating the plans as a result of “unsettling speculation following the company’s recent trading update”.

Read will remain in his position until a successor is identified. Read has headed Logica for 14 years.

The company added that it is reviewing the appropriateness of the board’s current size and structure.

The Financial Times' Lombard (29 May) commented that a review of Logica’s board size may well be necessary – it has 14 directors – but there is a risk that “corporate governance box-tickers” will see a causal link between the company’s weak performance and its divergence from Combined Code recommendations, and offer it as evidence of the need to follow the Code to the letter.

However, said Lombard, the reality of running a company is that some boards may genuinely need to be large, or a particular individual should be the chairman. Boards, Lombard said, should feel free to ignore the Code’s recommendations where appropriate.

June 2007