Five things Sir Adrian Cadbury’s life can teach family businesses

Sir Adrian Cadbury, the former chairman of the family business Cadbury and later Cadbury Schweppes, has died. His legacy is probably best remembered in his efforts to reform UK corporate governance structures. Here are five things family businesses can learn from his long and distinguished career.

Governance

Sir Adrian became one of the UK’s biggest advocates of sound corporate governance. After retiring from the chairmanship of Cadbury Schweppes in 1990, he was asked to produce a report into corporate governance. The now famous Cadbury report of 1992 has had a profound influence on corporate governance reform in the UK, with its recommendations on splitting the role of CEO and chairman, as well as the need to appointed qualified non-executive directors. Although considered radical at the time by much of corporate Britain, his ideas have today become almost standard practices in the structure of UK boardrooms.

Outside help

An international rower – Sir Adrian competed in the Helsinki Olympics in 1952 – he was also a visionary in terms of bringing in outside help to improve the performance of the family business that traces its origins back to 1824.  He engaged the services of management consultants McKinsey in the 1960s, which created shockwaves in the UK corporate world at the time. Whether McKinsey’s advice ultimately proved valuable, with its recommendations to diversify Cadbury’s product range and its markets,  may be questioned today, but the move started a trend. Today it’s pretty much accepted that outside help can be useful for family businesses to help them focus on what really matters.

Don’t show entitlement

Sir Adrian had all the benefits of an English patrician upbringing. Educated at Eton and Cambridge, and from a wealthy and famed family business dynasty, he was certainly a member of the lucky sperm club. Nevertheless, his sense of entitlement was never made obvious. On his way up, Sir Adrian made sure he understood how the business worked at all levels by spending times in many of the departments of Cadbury including the post room and the factories making the chocolates. He was a vocal proponent of meritocracy, believing that the best candidate should get the job, not necessarily the family member. The Quaker roots of the family business – its founder John Cadbury was a Quaker – were probably in the back of Sir Adrian’s thinking when it came to many of his decisions.

A pragmatist

Sir Adrian may have had plenty of ideas on how to improve corporate governance, but he was always a pragmatist when it came to change. As he once said: “We should try to establish a set of standards and structure that will give the best protection against the wayward, but there is no absolute protection. That’s part of life.”

A failure?

Of course, Sir Adrian was no failure, but in one sense he was in that he failed to keep the business a family one that some reckon would have been better for Cadbury’s long-term success. The merger with Schweppes in 1969 started diluting family ownership, which eventually led to the sale of Cadbury Schweppes to American food group Kraft in 2010. The Kraft deal, which Sir Adrian had no influence on, led him and his younger brother Dominic to write a letter to a British newspaper that said: “A bidder can buy a business….What they cannot acquire is legitimacy over the character, values, experience and traditions on which that business was founded and flourished.”