ALEX BRUMMER: Wilko heirs have to please their workers

Hearings before select committees of MPs rarely cause a stir.

However, the gigantic televised row between former King of the High Street Sir Philip Green and campaigner Frank Field over the fallout from the collapse of BHS in 2016 was a massive exception.

Both emerged victorious in their own way. By using quick-wittedness, quick-wittedness and business know-how, Green was able to show that he had been let down by the good and the great.

It was the professional firms who had given the assurances before he signed off on the sale of BHS to later convicted tax evader Dominic Chappell.

Field’s goal was to put Green in the stocks and force him to give up his family fortune to bail out pensioners.

Human cost: Many of Wilko’s 12,500 jobs are at risk following the chain’s collapse and there is a pension black hole

After a major public uproar, unlike anything we have seen before or since, Green finally wrote a personal check for £363 million.

In doing so, he ensured that his former colleagues’ retirement income was preserved and that the deductions required by the pension regulators were avoided.

Green’s assumption of responsibility was a rare exception. Lisa Wilkinson, a direct descendant of Wilko’s founding family, has publicly defended the £77 million in dividends the family received in the years before the store chain’s demise.

But there is no denying that many of Wilko’s 12,500 jobs are at risk and there is a black hole in pensions.

Her narrative is not dissimilar to Green’s. She argues that directors and auditors never questioned the viability of the high street chain until it went bust.

However, none of this changes the fact that this is a complete betrayal of 2,000 pensioners who are threatened with a drastic reduction in their benefits if, as expected, they end up with the Pension Protection Fund.

It is estimated that on a buyout basis (the price of handing over the fund to a private operator such as Aviva) £76 million would be needed to ensure pension benefits are maintained.

As a family business that went public, the Wilkinson heirs have a moral and business responsibility to help secure good pensions for the workforce, which brought such rich rewards to the founders.

Arm rotation

When you look at the fees available to investment bankers and professional advisors in initial public offerings (IPOs) in New York, you can better understand why so many foreign companies are being pushed in this direction.

Disclosure documents in New York show the banks behind the Arm float – Goldman Sachs, JP Morgan and Japan’s Mizuho – collectively raised $100m (£71.4m).

Even more surprising is that other consultants, including Deloitte, raised $84m (£67.8m).

Given that the task was to sell only 10 percent of the shares, leaving 90 percent in the hands of Masayoshi Son, SoftBank’s mercurial boss, the fees seem hefty.

Spurred on by cornerstone Big Tech stocks, there was great joy as shares hit a 25 percent premium. At this point, it looked like Son was right when he originally asked for a higher price.

People bought Arm on the grounds that it was an AI pioneer following in the footsteps of former competitor Nvidia. But Arm has yet to convert its AI expertise into revenue.

Additionally, about 25 percent of Arm’s revenue comes from disgraced China, where the company has wrestled with Beijing over board composition.

What should equally worry Arm’s US-based CEO Rene Haas is the fact that short sellers are piling up on the share registry, causing the stock to trend downward, even though it is still – for now – above the offering price.

The streets of New York may be paved with gold, but the big winners are the overpaid consultants.

Bird brain

The Big Tech dominance of online education group Pearson, chaired by former Google bigwig Omid Kordestani, doesn’t provide much stability.

Disney exile Andy Bird has disappeared into cyberspace after being attacked by shareholders over his own pay package for just three years.

As if that wasn’t provocative enough, new boss Omar Abbosh, fresh from Microsoft, was tempted to fill Bird’s shoes with a whopping £13m in remuneration.

Attracting the best and brightest is one thing, but trampling on the UK’s governance standards is quite another.

Non-executives exist to enforce standards and protect shareholders from wanton excesses. Instead, they act like nodding dogs.