May 2018
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In July, Merlin Swire will relinquish his role as the London-based CEO of John Swire & Sons Limited and succeed John Slosar as Chairman of Swire Pacific Limited in Hong Kong. It is an appointment that has intrigued market analysts, because it is the first time since the 1860s that a member of the Swire family has taken up the reins of Taipan. Meanwhile, John is to stay on in Hong Kong as Chairman of Cathay Pacific Airways. Swire News recently caught up with the outgoing and incoming Taipans and asked them to elaborate.

"Hong Kong has been a central part of our family's story and every generation of the family has become very familiar with the city at different times," says Merlin. "We've always loved Hong Kong and its way of life and have, I think, shown ourselves to be a committed presence through good times and bad. So to have a family member as the Chairman of Swire Pacific for a period is a natural extension of that commitment." But does this move represent a shift in group policy? Says Merlin: "It certainly doesn't represent a permanent change to our governance structure, and market watchers would be mistaken to interpret it as such. Being in Hong Kong will provide a great opportunity to refresh longstanding family relationships, and to make new ones. I'm also looking forward to being exposed in a more direct way to the economic and political trends that are affecting our businesses in the region."

It goes without saying that the group's Mainland China interests – with China forecast to become the world's dominant economy within the next generation – will inform Merlin's strategy as he leads Swire Pacific into the next chapter of its development. "Our businesses that operate in China have built a very solid platform over the last two decades, in particular Properties and Beverages, and I think are well positioned to take advantage of the growth in spending power in China in the years ahead", he says. "The reputation of the Swire and Taikoo brands for quality and reliability continues to strengthen. I hope we will find ways to leverage that strength into new business opportunities. We are a diversified conglomerate and intend to remain one, so we should always be open to new directions. In particular, I'm keen for us to increase our commercial presence in those parts of the Greater Bay Area now becoming more easily linked with Hong Kong."

Weathering some tough times over the long-term is a given in business, and Merlin is taking over Swire Pacific at a time when some of its best known companies have been hard-hit by market forces. Maintaining morale in those businesses that have been struggling in recent years, and that have had to reduce staff numbers, will therefore remain a key challenge for the leadership team. Difficult cost-cutting has already been effected by Swire Pacific Offshore in response to the acute down-turn in the offshore oil and gas industry, but, says Merlin, "a return to profitability will require a significant step-up in exploration activity by the oil majors – which is something beyond our control."

At Cathay Pacific, which has been severely affected by the challenging operating environment, a long and arduous journey began last year with the roll-out of the three-year transformation programme. This is where John Slosar's unrivalled expertise and experience comes into play, providing all-important continuity in spearheading this critical initiative to turn the airline's fortunes around. "My role will be to support the leadership team in completing the programme, in preparing plans that take best advantage of the opportunities and strengths we have, and in then executing those plans," says John. "Having spent nearly half of my career in the airline, I am delighted to be able to support the efforts of the Cathay team. Of course, aviation as a business has even at the best of times been competitive and challenging, but the Cathay Pacific Group has a superb team of service professionals, a great product for our customers, a strong leadership team and, on top of all that, is based in the most dynamic city in Asia – Hong Kong." Adds Merlin: "I'm confident that John and the team will achieve the goals of the current three-year plan. The competitive pressures are here to stay, though, and Cathay will no doubt need a mind-set of continual improvement over the long-term."

As he steps back from the leadership of Swire Pacific, we asked John which have been his most memorable appointments, during his long and distinguished career with Swire. "I can honestly say that I have enjoyed every job I have had in the group!" he says. "During my career, I have been fortunate enough to have been able to play a role in the enormous growth in our airline businesses, the development of our beverages businesses in China and the USA, HAECO's setup in Xiamen and move to the new Hong Kong International Airport and Tseung Kwan O – and even some important property projects in Mainland China and at Taikoo Place in Quarry Bay, during my time as Chairman. I have always believed that you get out of things what you put in, so I have always tried my best to do the right things and to do them well and in the right way."

Like John, Merlin has worked in a number of the group's aviation businesses, beginning with his very first job as a management trainee back in 1997, manning the check-in desks at Kai Tak, when the former Hong Kong Airport was operating well beyond its design capacity. "Since when," says Merlin, "I've had a lasting admiration for the calmness under pressure of Cathay Pacific's frontline staff."

There followed ten years working in Hong Kong, Australia and Mainland China, culminating in two years as Chief Executive of Taikoo Xiamen Aircraft Engineering (TAECO) – now HAECO Xiamen – a posting that left him with particularly fond memories. "It's a wonderful business with a great team, and its success since the mid 1990s has been a perfect example of the group's ability to create a business of real quality from start-up to maturity. Xiamen was also a delightful city in which to live, with a wonderful tea-drinking and seaside culture."

And now, Merlin is looking forward to returning with his family to live in Asia, after a decade in London. "Although I've been a regular visitor to both Hong Kong and Mainland China during that time, there is no substitute for living somewhere to really feel what makes it tick. I'm excited, too, to be returning with Laura and my daughters, who will I know have a fantastic experience. Seeing Hong Kong through the eyes of a three-year old is going to be fun."


So does our retiring Taipan have any insights to offer his successors, after almost 38 years with the group? Says John: "I think the Swire group is well positioned for the future. Over time, the biggest challenge is always building the right team, and we in Swire work hard at doing just that, so I think there are reasons for confidence. I have always stressed the importance of teamwork – very few things can be achieved by one person alone and that is certainly true in our businesses – so I am very happy to have had a chance to contribute to building the team that will carry the group forward into the future". He concludes: "It has been the greatest honour and pleasure for me to have been able to work together with all my fantastic Swire colleagues, and I have greatly appreciated your ideas and support. I believe that, for the Swire group, the best is yet to come, and I look forward to seeing you all making great things happen!"
Writing the next chapter
INSIDER
Writing the next chapter
A duty to help
INSIDER
A duty to help
Swire News May 2018 issue
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