10/12/2014
NEWS STORY
The teams are to be allowed to help choose the sport's new chairman as Peter Brabeck-Letmathe (pictured) steps down according to an article in the Independent.
The Austrian, chairman and former CEO of the Nestlé Group, was first appoiinted as a non-executive director to the board of Alpha Topco Limited in 2006, and chairman in early 2012, a move driven by Bernie Ecclestone. However, following treatment for an (unspecified) "curable illness" he is stepping down, hence the need to replace him.
As chairman, Brabeck's replacement will head the committee which ultimately decides who replaces Ecclestone when he too decides to step down, however, contrary to reports elsewhere, the move is not a direct threat to the F1 supremo as the new chairman will not decide who replaces him.
The man tipped for the chairman's role is Paul Walsh, former head of drinks group Diageo, and, according to many, courtesy of his familiarity with brands: Smirnoff vodka (Force India) Johnnie Walker whisky (McLaren), the man best suited to guide the sport through the troubled waters it is currently encountering.
The contracts, which commit the teams to race in F1, state that there will be two "deed of undertaking" directors on the board of Delta Topco, the parent company of the series.
Under the Team Agreements (which commits the teams to race in F1 until the end of 2020) the F1 Group commits to having two directors on the board who are completely independent. They are not allowed to have worked for a team, the FIA, CVC or the F1 Group. They are known as "deed of undertaking" directors and the chairman is one of them.
The "deed of undertaking" directors are a point of contact between the F1 Group and the teams who will nominate a sole representative and who "shall have reasonable access to the Deed of Undertaking Directors (commensurate with Deed of Undertaking Directors’ independence and nonexecutive status and mindful of their directors' duties to the Company, including obligations of confidentiality) and we shall arrange an introduction between such representative and the Deed of Undertaking Directors to initiate and encourage communication".
The teams have to be consulted on the new chairman and can propose alternatives, though the F1 Group does not have to accept them.
According to the float prospectus the chairman is on two committees which will decide on Bernie's successor. They are the nomination committee and the remuneration committee. The prospectus states that the role of the nomination committee is to "review and recommend candidates for appointments to the Board" whilst the remuneration committee has to "review succession plans for Senior Management executive positions."
The new chairman will take over both of these responsibilities so, again contrary to reports elsewhere, it is unlikely that he will be a successor to Ecclestone as it is his job to select the candidates and not to put himself forward as one.
Chris Balfe
Picture Credit: Pruneau/Twitter