Lochlann Quinn

ESB's new Chairman talks to EM

Lochlann Quinn who has been Chairman of ESB since January 22nd says he is on another learning curve. His background as a Chartered Accountant at Arthur Andersen & Co, Deputy Chairman of Glen Dimplex and Chairman of AIB brought him into immediate contact with many facets of commercial life but rarely energy.

He greeted the request by Minister Eamon Ryan to succeed Tadhg O'Donoghue with some surprise. "As regards having any particular expertise in the industry - absolutely none. It just seemed very interesting, at a very interesting time in this society. Energy is a big challenge. I did not know quite what to envisage. The industry is probably much more complex than the average person thinks but then that applies to every business," he says.

Public perception of ESB, he believes, is benign with issues like gridlock on the M50 Motorway impinging far more heavily on many people. "I would think that about 80% of the public assume ESB is still a monopoly. For example, I was surprised that the ESB's input into power generation was so low. No, the public don't care. It doesn't impinge upon them and of course that is the way it should be. That, to my mind it a good thing. It shouldn't be a feature of people's lives. It works," he adds. One of six children, Lochlann was born in Dublin and apart from spending some years in London, he has lived in the same area all his life.

His education began in Belvedere and the No.12 bus took him across town, "In the days when parents allowed their six year olds to travel on a bus on their own". His parents moved to Ballsbridge and he continued his education at St Michael's before embarking on secondary school in Blackrock, ten minutes up the road.

Lochlann went on to UCD where he studied Commerce. "Dublin was a great place to live in the mid-60's. Its only later, looking back, that you realise how privileged you were. I'd say half the class in school went to university. I would have thought we had no real idea that only five percent of the population went to college," he recalls. That was Dublin when a young person's wealth was measured on the number of pints they could buy and when Myles na gCopaleen, "used to cadge drink from students in O'Dwyers and then berate them."

Lochlann graduated from UCD with a BComm in 1962 but wanted to stay on in college for the time being so decided to do Philosophy. But his friends were leaving; he found college life had become more mundane, "boring without them." Odd as it may seem from this perspective, the last thing he wanted was to be an accountant. But, he abandoned Philosophy in favour of Accountancy. "I actually ended up loving it, particularly when I qualified and went to London.. .I wasn't ambitious, not consciously. The 1960's were a very easy period for people lucky enough to get education. There was an explosion of jobs in Europe and America," he says.

Such was the surfeit of employment in London, he received 20 job offers in response to 20 applications. His first job was with Arthur Andersen in 1966 and he loved it, travelling extensively. He returned to Ireland three years later with the tremendous excitement of being part of a team that opened offices for the Company in Dublin. "Arthur Andersen was a great firm. What happened in America later was a real tragedy," he says. At about the time he was approaching 40, he wondered how the rest of his career might evolve.

He went into business with a client, Martin Naughton, whom he had advised on the setting up of Glen Electric, which later became Glen Dimplex. Leaving an established company like Arthur Andersen led to many rueful comments. "Everyone thought I was crazy. Glen Dimplex was a tiny little company and wasn't on the radar. In fact it wasn't on anyone's radar until we bought Hamilton Beech in America for €100 million in 1986. We even got an editorial in The Irish Times then," Lochlann says.

As well as becoming a highly successful and close business partnership, he and Martin Naughton forged a warm and lasting friendship. "The world was our oyster. We started buying companies in the UK, Europe and America. The enjoyment factor was the most exciting thing about it...We worked hard but we didn't work in the way people work in the financial services today. I would never have got into work before 9.30 a.m. I never had breakfast meetings," he says.

He took holidays, delegated work and always, where possible, spoke directly with people. "90 percent of my interaction with people was verbal. Lift the phone. Talk. I must say, I find the current email philosophy very weird. It's another generation and I'm not part of it," he adds.

He is "reasonably optimistic" about the future of the Irish economy, though the heady days of eight to nine percent annual growth are unlikely to recur. Growth of two to two and a half percent is much more probable but Ireland must remain efficient and competitive. He takes the view that the single-factor explanations for the development of the Celtic Tiger are "off the wall". "What we had was an amazing confluence of circumstances that is unlikely to be ever repeated. Some people talk about low tax rates but we've had low tax rates in this country since 1956 when a zero tax rate was introduced for exports," he says.

"Incentives for investment" is another explanation trotted out but, again, he finds it porous. "If the incentives were that good, why did so little investment come from France, Italy, Spain. It's been almost all American and coincided with an explosion in new tech industries which didn't have old factories and needed new factories. So, none, or very few of the old industries came to Ireland. But, we got the Intels and the Dells... all new industries," Lochlann adds.

American investors were not driven to Ireland by sentiment. They came because third generation Irish Americans, at their most powerful ever in Wall Street and on the Boards of major US Corporations, saw Ireland as a place that was culturally comfortable to them.

"An awful lot of foreign investment is cultural. Ask yourself why is it that the biggest investor in North Africa is France, the biggest investor in South Lochlann Quinn The Last Word America is Spain. They feel culturally comfortable. They say, this is a place where I can run a good business. It is why a lot of Irish companies went to the UK first. The same language, the same accountancy, essentially the same legal systems. An easy place to do business," Lochlann says. Looking at Irish society and the many changes, he is sceptical that life in the "good old days" was always that enviable.

To relax, he and his family like to visit the west of Ireland. "Most of my relaxation is with friends, playing golf, the west of Ireland – my favourite place. I had never been to the west, apart from Achill, until 1980. My wife took me and I fell in love with the place... Like most people in Ireland, I'm also interested in all sorts of sport – rugby, golf, hurling, Gaelic football, soccer. I ski, not well, but I ski", he says.

Chairman of the National Gallery of Ireland and former Director of the Irish Museum of Modern Art, his interest in art began at home and in Blackrock College with an inspirational teacher. His mother liked to have paintings at home and his brother Ruairi was a talented artist but gave it up in his Twenties. The owner of a large art collection, he says he doesn't have a favourite artist – "no such thing".

While living in London he was introduced to fine wine. His private interests today involve a vineyard in Bordeaux. "I was mixing with a lot of people who knew quite a bit about it and fine wine in those days was not that expensive, relative to plonk. So I developed a real interest in wine. French wine would be my favourite but I love Spanish and German win and some Californian," he says.

Now he looks forward to the challenges that lie ahead for ESB and its place in the energy market. New to the job, he has yet to define his approach, other than to learn how the business works.

EM