Outgoing Thomas Cook chief executive Harriet Green is reported to have left with a potential pay-off of almost £10 million.
Although portrayed as voluntary, her sudden exit came amid rumours of boardroom discontent over Green’s high media profile and about a recent downturn in Cook’s trading, the Times reported with a picture of her on its front page today.
Her unexpected departure sent Cook shares plunging by 18%, wiping nearly £400 million off the company’s market value and sending shares down at rival Tui Travel.
Green, whose ferocious work ethic and unyielding fitness regime polarised opinion among staff and shareholders alike, quit after two years, declaring her work was “complete,” the newspaper reported.
A yoga enthusiast who claims she only needs four hours’ sleep a night, Green cut 2,500 jobs and shut 400 Cook shops after being appointed to rescue Europe’s second largest travel group from the brink of financial failure.
Her transformation of the company earned her a £2.9 million pay cheque and the title of Veuve Clicquot businesswoman of the year.
Cook chairman Frank Meysman told trade media yesterday that the transformation plan was ahead of track and now was the right time to change chief executive.
“Harriet Green felt her contribution was probably on the maximum level at this point in time. We felt this was the right thing to do now than in a year’s time,” he said.
Although Green had been expected to leave after completion of the turnaround, she told the Times last month that her job was “nowhere near done yet”, insisting: “We have a ton to do. It’s heavy duty work 24/7 and I am committed to it.”
Although she will not receive a formal payoff, she will receive only six months’ remuneration after Meysman cut the previous 12-month contracts in half when he became chairman. However, Green, who was on a basic salary of £680,000, is also sitting on shares worth about £9.3 million at the present price awarded to recognise her performance, payable over the next two years, according to the newspaper.
Analysts suggested that her departure, which accompanied a warning on the company’s 2015 profits, had come about 12 to 18 months earlier than anticipated, sparking speculation of a clash of personalities with Meysman.
He insisted that there had been no falling out, although he conceded that the succession planning of a year ago, which had identified chief operating officer Peter Fankhauser as her natural successor, had taken place a little earlier than some had predicted because the turnaround was faster than expected.
“Harriet was the first to say this is probably going to take three years to get it all done,” Meysman told The Times.
“But then our ‘cost-out’ programme was done much faster than expected and so there comes a moment where you have to decide do you do it now, do you do it in six months, do you do it in 12 months’ time? And it was the feeling of everybody that you’d better do it now at the start of a new year.”
Meysman told the Financial Times that the Cook board made a “unanimous decision” on Tuesday to trigger a succession plan, which allows travel industry veteran Fankhauser to replace Green.
Meysman denied disagreements on strategy and said the succession plan had been set in motion a year ago and agreed with Green.
Heather Jackson, founder of the Women’s Business Forum, said: “We’re all wondering, ‘Is there something else behind this?’ Possibly. She’s straight-talking, authentic, honest and open.”
Green is believed to have received approaches from several retailers in particular, according to the Telegraph.
Once her contractual obligations to Cook are worked through, an announcement on a new post will be forthcoming, one source said.