Liv Garfield, the chief executive of Severn Trent, is set to step down after an impressive 11-year tenure, marking her as the longest-serving female chief executive in the FTSE 100. The announcement came as the utility company, which provides water and sewage services to over 4.7 million households and businesses across the Midlands and Wales, revealed its half-year results. Garfield will leave her position at the end of December, with James Jesic, currently the capital and commercial services director, taking over as chief executive.
Jesic, who also serves as managing director of Hafren Dyfrdwy Cyfyngedig in north-east and mid-Wales, will lead the company into a new phase starting January 2024. Garfield will remain with Severn Trent until the end of March to ensure a seamless transition. Under her leadership, the company has seen significant changes and growth, particularly in its environmental performance.
Garfield’s Legacy and Financial Highlights
Garfield’s departure was announced alongside a report indicating a remarkable 60% increase in pre-tax profits, which rose to £307.8 million for the six months ending September 30. This financial success has prompted Severn Trent to revise its annual outlook, anticipating performance incentives of at least £40 million, a significant increase from the previous estimate of £25 million. The company attributed this growth to effective measures in reducing leakage, storm overflow spills, and pollution.
Severn Trent has also recently implemented a 21% hike in bills, translating to an approximate £99 increase for the average household, which will now pay around £556 annually. The company has stated that these increased rates will help fund a £15 billion investment to upgrade its network of pipes, sewers, and reservoirs over the next five years.
Garfield expressed pride in her tenure, stating, “It has been a true privilege to be the chief executive for the last 11 years. I am proud that together we have become widely recognised as a sector leader and now have our largest ever investment programme ahead of us.”
Looking Ahead with James Jesic
Christine Hodgson, chairwoman of Severn Trent, praised Jesic as a “home-grown leader” who has made substantial contributions to the company’s success. She highlighted his operational expertise and his commitment to the company’s mission, declaring him the ideal candidate to lead Severn Trent forward. Jesic’s starting annual salary will be £775,000, compared to Garfield’s current salary of £873,200.
Jesic joined Severn Trent as a graduate in 2003 and has experience across various sectors of the business. His leadership will be crucial as the company navigates public scrutiny over rising bills and increasing concerns regarding sewage pollution and executive compensation.
The water sector, including Severn Trent, has faced intensified public outrage in recent years due to these rising costs. Nevertheless, Severn Trent has been recognized as one of the better-performing privatised water companies concerning environmental metrics, successfully meeting targets set by the regulatory body Ofwat. The company aims to halve storm overflow spills to around 13 by 2025 and is on track to achieve its leakage reduction objectives for the eighth consecutive year.
As Liv Garfield prepares to leave her role, her impact on Severn Trent and its future direction remains significant, with Jesic poised to continue that legacy.
