You’ve probably never heard of Punch Taverns. But you may well have had a drink in one of their pubs, perhaps after a meeting. After all they’re a pubco, owning over 9,000 British pubs.
But if you like the pub, that’s because the staff have worked hard to make it a friendly, sociable place, not because of the Punch brand name. Despite their lack of public recognition, chief executive Giles Thorley awarded himself £11.3 million last year – because he’s worth it! Punch Taverns has the biggest gap between executive and workers’ pay in Britain.
Thorley’s payout would pay the wages of 1,148 Punch workers (average wage around £10,000 a year).
Most of Thorley’s wonga is from stock options. Since he joined the outfit in 2002 he’s driven up Punch share prices four times over, so the owners obviously think he’s worth it. But how does he do it?
Thorley’s business plan was to mortgage income from beer drinkers in the pubs next year to buy more pubs this year. And so on…Easy as falling off a log!
If you’ve noticed a small flaw in Punch’s plans for world domination, well yes it is basically the same as the business plan at Northern Rock. It relies on taking over rivals, not making the pubs pleasant places for Punch customers.
But it’s certainly delivered for the bosses. The Federation of Small Businesses reckons that Punch takes 70p of every £ in profits from the pubs. In the meantime the debt on the real estate acts as a ratchet screwing down the wages of the tenants and the workers. For many couples running a pub is a dream job. Thorley aturns it into a nightmare, screwing them on rent, the price of beer and anything else he can use against them. Tenants are usually in and out within three years in Punch Taverns. They survive in the meantime by paying some of the lowest wages in Britain.
Thorley doesn’t actually know anything about running pubs. He reckons he doesn’t have to know anything. He came from Nomura Bank. He’s basically a master of financial shenanigans. His magic with money really consists of turning everyone else into galley slaves so fat cats like him can benefit. Here’s to Giles Thorley. What a lovely man!