15 February 1999
Kingfisher is one of Britain's most successful retail groups. It is best known for its high street trading subsidiaries - Woolworths, Comet, B&Q, MVC, Superdrug and, property business, Chartwell Land - which have a total of 2,000 sites around the UK. Kingfisher also has businesses based throughout Europe and internationally.
The merging of B&Q with Castorama in December - in return for a 55 per cent stake in the quoted French group - was a key expansionist move.
Kingfisher operates three principal business divisions:
Electrical, which consists of Comet (number two in the UK), Darty and But in France, ProMarkt in Germany, BCC in The Netherlands, New Vanden Borre in Belgium and Electric City in Singapore.
DIY, consisting of Castorama, Brico Depot and Dubois Materiaux in France, and Reno Depot in Canada.
General merchandise, including Woolworths, Superdrug and video chain MVC.
The in-house legal function is tiny compared to many FTSE100 companies. Instead, the group operates a sophisticated panel consisting of City, niche and regional firms.
Group company secretary Helen Jones is the key figure at head office, and the architect of the group's legal structure.
Explaining the thinking behind the shape of the legal function, Jones says: "Kingfisher has, apart from property work, little legal work that is of a repetitive, production-line nature. So each time we have an issue worth getting fussed over, it's something very different. To get the quality and skills we want - as well as value for money - we would rather pay for what we want, when we want it."
Jones' background includes experience of working in the finance departments of industrial groups such as Coventry Climax, accountancy firm Ernst & Whinney and eight years with Guinness, where she handled a lot of corporate work, including disposals.
With a good eye for detail, she re-shaped the panel in 1996 - assisted by ICM consultant Peter Coleman - by reducing it from more than 40 firms to 11. It meant there was more work for fewer firms, closer working relationships, and that Kingfisher received better value for money.
"The legal spend hasn't risen in the past two years," Jones says. "We have client relationship statements rather than contracts, and no commitment to minimum fees.
"We try to keep firms informed about what is going on, give them all the press releases, and hopefully they understand us better. They spend less time having to learn about us."
Last September, Jones brought solicitor Patrick Andrews into the team, which includes two employment lawyers. With a background in international commercial law and a flair for languages, Andrews is working on projects involving, where possible, the standardisation of group contracts with suppliers.
Big ticket legal work, such as mergers and acquisitions, is passed through the central company's secretarial department. Smaller UK work is usually handled by four company secretaries of group companies: Phil Parker at Woolworths, Graham MacDonald at Comet, B&Q's Gary Shillinglaw, Sally Mitchell at Superdrug and Anne Lawley at Chartwell Land. Each of them can instruct panel firms.
The bulk of Kingfisher's legal work is property related. However, all manner of commercial issues arise, including trading standards matters, reviews of terms and conditions of purchase, consumer legislation and, of course, corporate work, which consumes most of the central company's legal budget. Competition law is also important.
Jones sums up what Kingfisher looks for in its law firms: "Honesty about what they can and can't provide, and about where we can improve."
Head of legal and company secretary
|FTSE 100 ranking||Number 33|
|Market capitalisation||Approximately £8.5bn|
|Legal function||Company secretarial department, plus three lawyers|
|Head of legal||Company secretary Helen Jones|
|Reporting to||Sir Geoff Mulcahy, group chief executive|
|Main location for lawyers||London|
|Main law firms||Freshfields, Clifford Chance, Lovell White Durrant, Macfarlanes, Rowe & Maw, Olswang, Hughes Watton, Addleshaw Booth & Co, edge ellison and Bond Pearce|