If Dame Sharon White had already made her mind up about stepping down as chair of John Lewis and Waitrose last month, it did not show.
On September 14, she warned it would take a further two years to complete a turnaround plan as inflation continued to drive up costs — but said that senior management would be in place to see it through.
She will not be among them after informing the board this week that she would not seek a second term at the UK’s largest employee-owned company when her tenure ends in February 2025. The decision will make her the shortest serving chair in the group’s 159-year history.
Her successor will take on one of the toughest jobs in retail. Not only will they seek to return the group to profitability while keeping a lid on costs, they will do so under the intense public scrutiny that is reserved for Middle England’s most beloved retailer.
“We’re not actually surprised about [White’s] end point but we are surprised by the apparent suddenness,” said one senior employee who works with her. “Retailers don’t do stuff like this before Christmas trading unless you absolutely have to and she does not absolutely have to.”
People close to the company said there was nothing unusual about the timing of the announcement and pointed to the similar length of notice given by her predecessor Sir Charlie Mayfield in 2018 before he eventually departed in 2020. It was part of an orderly succession process, the company said on Monday.
But the employee added: “I think the disappointment will be consistent across the board . . . for some that will be disappointment that somebody really well liked and respected, who painted quite an inspirational figure, is going. For others it will be disappointment that someone who came in and promised so much, didn’t deliver it.”
White was the first woman to lead the business and remains one of the few women of colour to have run one of Britain’s biggest brands. Her inclusion in Queen Elizabeth II’s new year’s honours for 2020 and her marriage to high-profile economist Sir Robert Chote gave her wider fame than most of her peers in the retail sector.
White, who previously ran media regulator Ofcom and was a senior Treasury mandarin, lacked retail experience when she joined. She does not have another job lined up and is not in the frame for the BBC chair role, according to people close to her, amid media speculation that she could be enlisted to help run the public service broadcaster. If a successor is found before February 2025, she will step down, according to a person with knowledge of the process.
“Was I surprised? No. The main signal was her appointment of a CEO,” said the chair of another retailer, referring to the appointment in March of former Hovis boss Nish Kankiwala as John Lewis’s first ever chief executive.
That move suggested “there’s a recognition that she doesn’t really feel comfortable . . . actually running the day to day business”, the person said. They added that “she has had a tough time” as some of John Lewis and Waitrose’s travails were inherited and compounded by the pandemic and the cost of living squeeze.
Under White, the group has already achieved £300mn of cost savings, with a further £600mn to be delivered by 2028. It has been tackling its net debt pile, which is currently at £1.9bn compared with £3.6bn in 2015 following a period of aggressive expansion of stores and its ecommerce operations.
In May, White lost a vote cast by the retailer’s partnership council — a group of about 60 employees representing the views of around 80,000 staff — relating to the previous year’s business performance, in which it reported a loss and did not pay a staff bonus. However she won a confidence vote on her future leadership.
The appointment of a CEO could give John Lewis flexibility to alter the nature of the chair role as it chooses her replacement. Large UK companies more typically have a non-executive chair, unlike the more hands-on role occupied by White and her predecessors.
White asked the company to consider changes to the chair position, which could lead to a more traditional or part-time arrangement. The partnership has not yet appointed headhunters but it previously worked with Egon Zehnder to find a replacement for Mayfield.
“The board will need to decide on the balance of power between the chair and chief executive before reviewing and filling vacant roles,” said Nick Bubb, an independent retail analyst.
One theory among senior employees is that Kankiwala, who was a non-executive director before he became chief executive, could become chair and hire a seasoned retailer as CEO to run the day-to-day operations. However people close to the company said it was unlikely that the former PepsiCo and Burger King executive would pursue it.
Bubb suggested that retail bigwigs such as Justin King, Mike Coupe — both former Sainsbury’s bosses — or departing Morrisons boss David Potts would be a good fit if they were willing to navigate the constraints stemming from John Lewis’ unusual employee-owned structure, such as its limited ability to raise cash externally. Power is shared equally by the chair, the council and the board.
Another option could be Mark Price, who ran Waitrose for a decade, Bubb added. “At least [he] knows his way around the internal politics.”
White encountered resistance from workers over a proposal to sell a minority stake, which was subsequently shelved. Months later, the suggestion that parts of John Lewis’s prized Leckford estate, which is steeped in history having been bought by the retailer’s founder, could be sold off also proved unpopular. The Leckford estate, a 2,800-acre farm that also has a water garden as well as fishing and golfing facilities, is not for sale.
The successful candidate should be a retailer, according to several headhunters and industry analysts. White was an unconventional choice having never run a commercial business although her values aligned with those of the partnership, vaunted a decade ago by former deputy prime minister Nick Clegg as the friendly face of capitalism.
Other names such as former WHSmith and SSP boss Kate Swann, who lost out to White last time, or Andrew Higginson, the former Morrisons and current JD Sports chair, have been suggested by two headhunters.
One former employee said the process needed to be done quickly “to get competence at the top and then change across the executive [team]”.
Opinion is split as to whether a new broom should stick with the current plan, which comprises a push into financial services and build-to-rent, or ditch it.
Richard Hyman, partner at retail consultancy TPC, believes that the lower risk strategy would be to focus solely on selling the right products at the right price. “However tacky that might seem, it is about selling stuff,” he said.
“The fabric [of the business] is underinvested — the buildings, stores, the environment that they’re inviting customers into, the infrastructure and the system necessary to manage inventory so you don’t end up with empty shelves,” he added.
The senior John Lewis employee argued the strategy was right, but execution needed to pick up pace. “I just think there has been insufficient rigour and experience in the delivery of core retail,” they said.
