Yahoo Finance BBC appoints private equity veteran as end of licence fee looms
The BBC has appointed City veteran Sir Damon Buffini to be its deputy chairman as the broadcaster grapples with a squeeze on the licence fee and questions over its future funding.
Sir Damon was a founding partner of investment firm Permira and was one of the best-known names in private equity in the early 2000s. He was a bete noire for trade unions after Permira pushed through job cuts at companies including the AA and Bird’s Eye at the height of the global financial crisis.
His appointment is part of efforts by the BBC to bolster the commercial side of its business as licence fee funding comes under pressure.
The broadcaster has had its main source of funding frozen for two years, prompting a wave of cost-cutting and efforts to find new sources of revenue.
The future of the licence fee is also in doubt in the long term. Culture Secretary Michelle Donelan this week branded the model “unsustainable”.
BBC chairman Richard Sharp said the appointment of Sir Damon reflected the “integral part that the BBC’s commercial activity plays in the corporation’s overall success”.
He added: “As chair of the BBC commercial board, Sir Damon brings vast experience and expertise to the oversight of our commercial operations at a time when the BBC board is looking for significant and sustained commercial growth.”
Mr Sharp himself had a high-profile career in the City as a banker at Goldman Sachs. He became chairman of the BBC’s board in February 2021.
Sir Damon joined the BBC as a non-executive director in November last year and was appointed chairman of the BBC commercial board in March.
As part of the overhaul, Sir Damon also appointed three senior media executives to the BBC’s commercial board.
Gary Newman, former chairman and chief executive of Fox Television Group, Ian Griffths, former finance chief at Kantar and ITV, and Claire Hungate, previously chief executive of Warner Bros’ UK TV arm, will all join as non-executive directors from April 2023 for an initial term of three years.
Sir Damon said: “The BBC’s commercial subsidiaries, already successful, have been tasked with a further step-change in performance.
“The appointment of three new non-executives, with spectacular industry experience, reinforces the commercial board’s commitment to support and challenge the executive in achieving these stretching goals.”
Sir Damon, a devout Christian who was raised by a single mother on a council estate in Leicester, oversaw the rise of Permira into one of Europe’s biggest buyout firms.
He was seen as a figurehead of capitalism in the early 2000s and became the target of a public campaign by unions, amid accusations of greed and asset-stripping.
In one stunt, disgruntled trade unionists paraded a camel outside the Clapham church where he worships – a reference to the biblical teaching that it is easier for a camel to pass through the eye of a needle than for a rich man to enter heaven.
When the tycoon was awarded a knighthood in 2016, the GMB branded it an “insult to society”.
At the time, Sir Damon said he was “committed to having an open and constructive relationship with trade unions” and offered to speak to the GMB “directly about any concerns you might have, and explain in detail the work that we do”.
Sir Damon has served on various boards including Schroders, the Royal Shakespeare Company and the Wellcome Trust. He is also chair of the National Theatre.
Earlier this year, he was reported to have compared running the National Theatre to being Nelson’s column, saying: “You get s–t on by everyone.”
BBC Studios, which houses the organisation’s commercial production and international distribution divisions, pulled in revenue of £1.6bn last year.
However, this is less than half the £3.8bn made through the licence fee. Director general Tim Davie has secured an agreement to double the amount BBC Studios can borrow to £750m to help fund its expansion.
The public service broadcaster faces growing competition for younger audiences from streaming services such as Netflix and Amazon, as well as apps including TikTok.
Davie this week warned that the BBC must plan for a full switch-off of terrestrial TV and a move to online-only broadcasting by the end of the decade.
