Sir Derek Alan Higgs

Doctor of Laws

13 July 2005 - Orator: Mr Derek Pretty

Mr Vice-Chancellor:

There are four things in particular we look for when we are trying to decide whom the University of Bristol should honour with the award of an honorary degree.

We search out people who are outstanding figures in their own field, as in the case of today’s honorary graduate, Sir Derek Higgs, who is a significant business leader and a distinguished merchant banker.

We look for people with links to Bristol; Sir Derek is a graduate of the University, a former member of Council and now a Pro-Chancellor.

We are always particularly keen to find someone who has done more than a good job – we want someone who has made a mark in a number of ways; the wide array of activities Sir Derek has undertaken outside his normal business life is ample evidence of this.

Last, but not least, we search for someone who can be seen as a role model, both for those receiving their degrees and more widely within the University. Sir Derek’s achievements and the values he espouses in his daily life fully meet this requirement.

The path to where Sir Derek is today began in the Midlands. Sir Derek’s father was a local Coventry businessman who had made his own way in the world, with great success. Derek was educated in Solihull where his housemaster described him as having a certain “glum enthusiasm”. He came to the University in 1963 to read economics and accountancy and was a resident of Churchill Hall.

After graduation in 1966 Sir Derek qualified as a Chartered Accountant with Price Waterhouse & Co, moving into merchant banking as a corporate finance executive in 1969, with Baring Brothers. It was here that he first recognised the arrogance and nepotism that eventually helped to lead to the downfall of Barings. So, in 1972 he moved to SG Warburg & Co Ltd, a merchant bank that, under the leadership of Siegmund Warburg and David Scholey, was renowned for its anti-establishment stands, its innovations and for the fact that it was a meritocracy.

Sir Derek remained with Warburgs until 1996, eventually becoming its Chairman.  Today, amongst other things, he acts as a senior adviser to UBS, the Swiss bank group that acquired Warburgs in 1995.

Sir Derek’s success as a merchant banker and corporate financier placed him in the middle of the exciting years in the City of London that eventually led to the so-called Big Bang in 1986, when the United Kingdom’s financial markets were liberalised and completely reshaped. He played an important part in the mergers of Warburgs with jobbers Ackroyd & Smithers, stockbrokers Rowe & Pitman and government brokers Mullens, to form the Mercury International Group, an organisation that had a profound influence, both on the City of London and on the wider business world.

Following the acquisition of Warburgs by UBS in 1995, Sir Derek decided that it was time for a change of career, a chance to put back into the system some of what he had had the opportunity to take out. This was something of which his father would have heartily approved.

From 1996 to 2000 Sir Derek served as Chairman of Prudential Portfolio Managers and as a director of the mighty Prudential Assurance Group.

At the same time he also started to spread his wings outside business, for example, as Deputy Chairman of the City of London Festival, which organises annual celebrations of the history of the City of London, its music, its art and its architecture. And since 1999 he has also been a director of Business in the Community and chairman of Business in the Environment, organisations with aims and values that we in higher education would recognise, respect and endorse.

In June 2002 Sir Derek was approached to undertake the task for which he is probably most well known. Patricia Hewitt, the then Secretary of State for Trade and Industry, and Gordon Brown, the Chancellor of the Exchequer, invited him to follow in the footsteps of Sir Adrian Cadbury, Sir Richard Greenbury and Sir Ronnie Hampel and to undertake a review of the role and effectiveness of non-executive company directors.

Mr Vice-Chancellor, undertaking a review and writing a report for the government may at times be a mixed blessing. It brings public recognition but it also can have its downsides: and while our honorary graduand has benefited from the former, he has not been totally immune from the latter.

Sir Derek’s review was of particular significance because it focussed on a group of people, in particular company chairmen, who were more used to telling others how to improve their effectiveness than they were to improve their own.  In January 2003, Sir Derek’s report was published and anyone with any knowledge of the running of large organisations will be aware of, and has probably been impacted by, his recommendations.

At the time of publication support was not universal. Company chairmen felt threatened by the suggestion that an independent eye might be needed to watch over their succession. The CBI had mixed feelings and opposition political parties decided that they would try to score a few points at Sir Derek’s expense. Adverse comparisons were even made with the infamous Sarbanes-Oxley Act in the United States and I am sure that Sir Ken Morrison, whose eponymous supermarket chain has recently suffered a few setbacks, still strongly disapproves of Sir Derek’s proposals!

What Sir Derek may not have realised is what his report would do for him in terms of wider fame. He has clearly arrived.  I discovered this when I started the research for this oration on the World Wide Web. I am not sure whether there is a league table somewhere of the highest number of personal hits on the Google search engine; but Sir Derek has got off to a fine start with eight thousand results against his name. To calibrate this number I foolishly checked my own score; sadly it was too small to reveal!

Mr Vice Chancellor, I have highlighted Sir Derek’s distinguished career and his service outside business. Now I turn to another aspect of his life. Sir Derek’s father, Alan Higgs, had given Derek and his sister a very happy family background and a good education. He had a profound belief that a good start in life through access to opportunities was of more value than inherited wealth. He therefore left instructions, when he died, that a charitable foundation should administer his considerable fortune to benefit the people of Coventry and its surrounding area.

With the skills he had acquired in his working life, Sir Derek and his sister, Marilyn, together with his late mother, have been trustees of the Alan Higgs Charity and have both protected the Charity’s capital and distributed its income - 6 million pounds to date - making an enormous difference to the lives of many people.

The charity’s development of the Ricoh Arena in Coventry in partnership with the City of Coventry and with a strong personal involvement from Sir Derek himself, is expected to generate over 3000 new jobs in the Coventry area. It also provides a ground for the football club of which he is a director, Coventry City.

I turn finally to Derek Higgs, the man. Apart from his recognition by Google, his achievements have been acknowledged by the conferment on him of a Knighthood in 2004.

Derek is a family man and I am delighted that we are able to welcome here today his wife, Julia, [his sister Marilyn], his son Oliver and his daughter Josephine, recently married. Sadly his other son Rowley, a Bristol graduate, is not able to be here; he knew what the weather in Bristol was going to be like – so he has gone skiing. For himself, Derek is an enthusiastic sailor and until recent years an active motor-cyclist, having graduated during his career from a Honda 50 to a BMW K75.

In summary, Derek Higgs is a role model for those graduating today. He was given his first chance and he took it; he has demonstrated that hard work can help you create your own luck; he believes in relentless meritocracy and has shown that you can and should be willing to put back into the system what you take out. He has clearly also had fun while he has done it.

Mr Vice-Chancellor, I present to you Derek Alan Higgs as eminently worthy of the degree of Doctor of Laws, honoris causa.