Lunch With the FT: 52 Classic Interviews (12 page)

Deripaska is not feigning his interest in industrial processes. Few doubt that he has hugely improved management at all the Soviet-era plants he has owned and invested in. And yet more than energy and intelligence were needed to emerge at the top of the pile in the chaos that was post-Soviet Russia. The aluminium industry was particularly noted for violence and many people involved in the business ended up dead. I ask Deripaska if he had known what he was getting into, when he first got involved. ‘Not in the beginning,’ he laughs, ‘it was my nice surprise. Don’t forget I’m from a military family. I was in special training in the army. I am tall, sporty and – how do you say – you can always protect yourself … I have very strong security. Even now.’ He says he triumphed over the criminal elements as he rose to the top.

Many of Deripaska’s critics will take issue with that version of his rise. Michael Cherney, one of his most important business associates in the 1990s, is currently suing Deripaska in court in London, claiming that he was defrauded out of a significant chunk of his metals empire. Deripaska denies owing Cherney anything and denies that he was an associate. An associate of both men was Anton Malevsky, who has been described in court as the leader of an organized crime gang. Deripaska has said that he was forced to work with Malevsky and Cherney, who extorted money from him. Cherney denies this allegation. Deripaska also insists his aim was to clear out crime in the industry.

But in 2001 Malevsky died in a parachute accident in South Africa. Malevsky’s death sounds like something from a crime thriller or a Bond movie. I ask Deripaska, as pleasantly as I can, whether he believes that Malevsky’s death was a genuine accident. He blushes, glances down at his table napkin and laughs softly – ‘I have no idea,’ he replies.

I blunder onwards – ‘Because it sounds like something out of a movie. This guy dies in a mysterious parachute accident.’ I ask whether Malevsky was a criminal. Deripaska’s manner is pleasant but cagey: ‘It’s very difficult for me to go into detail,’ he says, ‘because of the case. I think my lawyer will try to have a hearing in court. It will be open; and I’m prepared to be open.’

Our conversation is interrupted by the arrival of a waiter. Deripaska ignores the starters and chooses one of the less gory items on the menu – lemon sole. I opt for a pork chop with fennel. Defying the usual clichés about Russians, Deripaska is a teetotaller, so we order some sparkling
water. After a little while, the food arrives. I wait for my guest to tuck in but he makes no move towards his fish. After about 10 minutes, hunger gets the better of me and I cut into my Gloucester Old Spot chop. A few minutes later, Deripaska seems to notice that I am eating and says, slightly absently, ‘Bon appétit.’ Without evident relish, he slices off a small piece of white flesh.

It is clear that Deripaska is a highly disciplined survivor. He got through the aluminium wars of the 1990s. When other Russian oligarchs fell out of favour, he survived again. Mikhail Khodorkovsky is in prison and Boris Berezovsky is in exile in London, but Deripaska is still in business. The financial crisis of 2008 posed another mortal threat. I ask Deripaska how close he was to going out of business – ‘Very close,’ he replies. ‘I remember certain bankers in February 2009, trying to explain to me that there was no chance.’ He points out proudly that, in fact, no debts have had to be written off.

The strain of the financial and economic crisis in Russia seemed to sour his relations with Vladimir Putin, who by then was prime minister. In a famous confrontation in the small Russian town of Pikalyovo in June 2009, Deripaska was subjected to a televised humiliation, as Putin ordered him to sign a document, safeguarding the future of a local factory, and then added caustically, ‘And give me my pen back.’

Some regarded the confrontation as a sign that Deripaska’s days were numbered. Others saw it as a carefully staged mock-confrontation between close allies. Deripaska insists that neither version of events is right. Putin, he says, was simply misinformed about the facts. ‘But he called you a cockroach on television,’ I protest. ‘That is exactly the point,’ Deripaska replies, ‘it was not against me. It was against other people who were trying to run away from the business.’

Certainly, any misunderstanding appears to have been cleared up. A few months later, the Russian government agreed to prolong vital loans that kept Deripaska’s business empire intact, when many analysts were convinced that it was on the brink of breaking up. As Deripaska sees it, the government simply realized that he was far better able to rescue a precarious situation than any state-appointed bureaucrat – ‘They have no idea what to do to restructure the company … Because, if you’re bankrupt, afterwards you lay off automatically more than 2m people … You can’t just kill a big white elephant and say, “OK, I have done the right job.” ’

Some analysts put Deripaska’s remarkable survival down to his impeccable political connections. He is married to the daughter of the chief-of-staff of a Russian former president, Boris Yeltsin. (They have two children.) He is also reputed to be close to both Putin and the new president, Dmitry Medvedev. In Britain, he befriended Lord Mandelson, the godfather of New Labour, and hosted George Osborne, now Chancellor of the Exchequer, on board his yacht. But Deripaska denies being particularly well connected. He says he was bewildered by the fuss that the British press made over his connections with Mandelson and Osborne, and professes never to see either Putin or Medvedev socially.

I ask him about the big question in Russian politics – whether Medvedev is really independent of Putin. He chuckles and skirts the question but adds that the two men represent different generations and have different outlooks. Will Putin and Medvedev run against each other for president in 2012? Deripaska says that nobody really knows – ‘I think at some point they will discuss this,’ he says, laughing heartily.

With his business empire safe, Deripaska’s worst worries seem to be over. But there are still problems on the horizon. There is the London court case. And there are his continuing problems with entry to the US. Last year, he was allowed to visit the country twice. But these seem to have been specially arranged visits. I ask him whether his visa problems are over – ‘I don’t know. I don’t care,’ he replies. I remark that it must be annoying ‘because it’s very damaging to your reputation’. ‘History will judge,’ he replies quietly. Hasn’t it been damaging to his business interests, I ask, not to be able to travel freely to America? ‘Yes, but it gives you more opportunity … When they started making a problem, I just went to Japan and I got much more.’ His companies are also taking an increasing interest in China.

Despite his problems in the US, Deripaska has powerful friends and allies in the west too. Bob Dole, a former US presidential candidate, has lobbied on his behalf. Nat Rothschild, a scion of the famous banking family, is a close confidant. James Wolfensohn, a former head of the World Bank, has also been a business partner. Deripaska’s western defenders portray him as a great industrialist and a patriot. Questions about his past tend to be brushed aside – or dealt with by references to the murky origins of the fortunes of some of the great American
industrialists and philanthropists of the 19th century. (Deripaska is also a big donor to charity.)

Deripaska himself, although he has a ready laugh, is earnest and ascetic. I notice that he has eaten just one half of his fish. The waiter reappears. I am feeling a bit peckish and hope that my guest will order a pudding. But Deripaska just asks for a black tea without sugar and I settle for a coffee.

As the lunch draws to a close, I ask him if he is ever tempted to go into semi-retirement and just enjoy life, like his friend the London-based Russian oligarch Roman Abramovich, who has bought a football club, acquired a new girlfriend and dabbles in modern art. Why not cash out? I ask. Deripaska looks faintly indignant – ‘And do what?’ he asks. As well as his current industrial interests, he wants to invest in nuclear power and in space exploration.

We walk out into the sunshine together. A large black car is waiting for him, just outside the restaurant, and a large man in a black suit is holding the door open. Deripaska steps in without a backward glance and the car moves silently off. I still feel vaguely hungry, so I walk down to Pret A Manger and buy myself a fruit salad.

In September 2012 Mr Deripaska and Mr Cherney reached an out-of-court settlement in their case over a $1bn stake in UC Rusal, the world’s biggest aluminium producer.

26 JUNE 2009

The executive chairman of HSBC, who is also an Anglican priest, breaks bread and discusses the ethics of globalization, moral ambiguity and being rewarded for failure

By Lionel Barber

Stephen Green arrives three minutes early for lunch but apologizes for being late. Tall, soft-spoken and wearing a dark suit, the 60-year-old executive chairman of HSBC is courteous, almost to a fault. We are at a small table in Le Pont de la Tour, a Thameside restaurant favoured by City bankers during the Blair–Brown boom. (Green originally favoured another City restaurant, the Bleeding Heart, but feared the name was an invitation to poke fun at him.) There are lunch guests on the terrace outside but inside the place is empty, testimony to the Blair–Brown bust.

The timing of our gastronomic encounter in the shadow of the Tower of London could not have been better. Hours earlier, Sir Fred Goodwin, disgraced former boss of the now state-controlled Royal Bank of Scotland, had bowed to popular demand and surrendered a third of his £l6.6m pension pot. As a conversation opener, the capitulation of Sir Fred is irresistible.

‘I am not going to talk about individuals,’ says Green, firmly. I push back, gently. The smile turns into a squirm. ‘No, no, no. That’s not fair … No … Not even off the record.’

Green’s reluctance to pronounce judgment is curious on two counts. First, he is an Anglican priest who has thought long and hard about right and wrong. Second, he has written two books about ethics and
business in the age of globalization, and it’s the publication of the second,
Good Value
, that, I remind him, is the reason we are having lunch in the first place.

Happily, a waiter arrives before our verbal skirmish goes any further. We study the menus. Green orders soused mackerel as a starter, followed by roast cod. I go for gazpacho and then roast chicken. In search of common ground, I suggest a shared side order of spinach. Then I return to the ticklish question of bankers being rewarded for failure.

The previous evening, Mervyn King, governor of the Bank of England, had delivered a stern speech at the Mansion House, admonishing bankers for failing to absorb the lessons from the global financial crisis. The Bank of England, he suggested, was like a church where the congregation turned up for weddings and funerals but paid no attention to sermons. ‘Yes, I was there,’ says Green, as he glides into a two-minute discourse on the governor’s plans for tackling systemic risk to the banking sector. It’s fascinating but not exactly relevant. What does Green say about bankers receiving handsome pay-offs when they have driven their institutions into the ground?

Green, sipping a Virgin Mary, counters with studied even-handedness. One must distinguish between bonuses and pension rights. Then again, there have been ‘market distortions’ regarding pay, not just in the financial sector. The era of ‘my word is my bond’ is over but people should not be starry-eyed about the age of the gentleman banker when insider trading was rife. Most important, ‘rules are never sufficient to enforce morality’, a theme we will return to during our 90-minute lunch.

I press him on the principle of restitution. Green refers me to the biblical tale of Zacchaeus, a corrupt tax superintendent who gives his ill-gotten gains to the poor. Once again this amounts to an artful dodge: Sir Fred may have been incompetent but nobody is suggesting he was corrupt. More fencing follows. Green simply will not be drawn into personal criticism. It is time to switch subject.

Green was ordained in 1988 and is a non-stipendiary minister attached to a church in London. He has stuffed
Good Value
with biblical references but also many literary ones, especially from Goethe’s
Faust
. He studied German at Oxford University – as did I, a few years after him. Green later switched to Politics, Philosophy and Economics, on the grounds that PPE was of more practical use than medieval High
German. Nostalgia overcomes me and I challenge him to recite the opening verse in part one of
Faust
.

‘
Habe nun, ach! Philosophie, Juristerei und Medizin … Durchaus studiert
’ (I’ve studied now philosophy, jurisprudence, medicine through and through), says Green, deploying a more than passable accent. I join in, but he trumps me by invoking Faust’s thumping declaration: ‘
Im Anfang war die Tat!
’ (In the beginning was the deed.) The bookish banker is in full flow, eyes alight, long arms ranging across the table. Passion for German culture is a rarity in contemporary Britain.