Company News » Paul White, FD of the UK Atomic Energy Authority

Some finance directors are good with numbers, and some are good with
strategy. But somewhere along this spectrum of stereotypes there are FDs who
don’t fit comfortably into pigeonholes. Paul White, finance and commercial
director of the UK Atomic Energy Authority (UKAEA), is one FD who has had a
career that is out of the ordinary. As he stresses: “A: I’m no ordinary finance
director. And, B: This is no ordinary organisation.”

White began his career in the Army as a private in the 1960s, becoming a
military accountant and then a lecturer in management accountancy for the Army
Pay Corps in the 1970s. In the 1980s he moved into the private sector, spending
nearly 15 years at GEC/Marconi as an FD in its defence subsidiaries. In 1994 he
moved to the UKAEA, where he manages the finances and risks of decommissioning
nuclear power stations that it helped develop in the 1950s and ’60s. Since White
joined, the UKAEA has decommissioned more nuclear reactors than any other
organisation in Europe and is beating deadline and budget to clean up its
remaining sites.

White also has Multiple Sclerosis and is a champion for disabled people.
Internally, he has been focused on making nuclear power stations accessible to
disabled users at places such as Dounreay in Scotland where “it’s difficult to
go anywhere because the bloody wind is so strong and the rain is horizontal”.
White is unfazed by a challenge and is uninterested in pulling his punches. And
as the UKAEA is accountable to its major shareholder, the Department of Trade
and Industry, as well as pressure groups and the public (“everyone has an
opinion about nuclear”) White takes a hands-on, no-nonsense approach to his
current role in saving the environment.

Part of that role, White says, is to be more focused on challenging an
organisation than crunching its numbers. He does not believe that his job is
simply keeping score and isn’t interested in talking about the minutiae of
running a finance department – not even the massive £4bn of nuclear liabilities
the UKAEA has on its accounts. “I’m glad we aren’t talking about the balance
sheet.” Why? “Because it’s boring,” he says.

Instead, White says his role at the UKAEA, just like at his previous jobs, is
about creating wealth. “When you go down the pub and people ask ‘Well, what do
you do?’ I say I’m creating wealth for the environment,” he says. “People used
to be derisory about accountants and call me a number cruncher. I’m nothing like
a number cruncher. I’m a creator of wealth and that usually puts people on the
back foot because they don’t understand what the hell I am talking about. ”
Wealth is measured in different ways in different organisations, whether it’s
the military, a charity, UKAEA or the private sector,” he says. “The Army was
there to protect our interests globally and, in my view, I was creating wealth
for those they were serving throughout the world. I don’t think it matters what
organisation, what structure, whatever company or business you’re in – it’s all
about creating wealth. Okay, so maybe it’s wealth for the shareholders in most
cases, but in the UKAEA it’s for a number of major stakeholders. It’s about
turning the nuclear legacy into a greenfield site which is safe for our children
and our children’s children. I think that’s a great responsibility,” he says.

In an organisation that pulls radioactive material out of old nuclear
reactors, surprises should be avoided at all cost, and White believes in
tackling problems head-on in an open and transparent way where good
communication is the key. He dislikes it when people sit through board meetings
nodding because they don?t want to face the issues. “If there’s a problem I
don’t wait until a board meeting, I bring it out straightaway.” He also believes
that the role of finance in any organisation is as a support function rather
than a centralised adding machine, and he encourages his team to create value.

“I hate it when people say that finance is an organisation in its own right
within business. That’s not bloody true,” he says. “I want my finance team out
there sitting next to the people they are supporting. Some people will say,
‘Well they report to you’, but I don’t give a shit who they report to. What I’m
concerned about is that they are providing a service to the business. And if
anybody wants to complain, my door is always open. I love to hear people
complaining because I will fight back.”

A role in the public sector saving the environment may sound strange given
White’s combative history, but it was the vision of the people in the UKAEA,
especially former chief executive Derek Pooley, that won him over and persuaded
him to take a pay cut to rejoin the public sector. “Derek talked so passionately
about what he wanted to do with the organisation, and his passion was catching,
” he says.

Passion is something White has in spades but he realises that drive and
energy can work against you – especially when moving into a new organisation.
When he joined the UKAEA in 1994, it had 10,000 staff and was looking to cut
employee numbers and streamline processes. White believed his job was to come in
for six months, shake things up, inject some commercialism into the organisation
and leave. “I was a thrusting FD with a great deal of experience, a great deal
to offer and I thought I would come in and solve the problems of the UKAEA in 10

He says that attitude was a big mistake. “I think the first thing I learned
was don’t say, ‘We did it this way in GEC’. People still make that mistake
today. These cowboys bring in their commercialism and, as I did, think they can
immediately change an organisation,” White says. “I really thought I would find
very old-fashioned thinking and burdensome, bureaucratic processes. I did find
some of those, of course, but I learned quickly that I wasn’t going to change
the world because the world didn’t need changing.”

White says there aren’t nuclear scientists wandering around anymore wearing
sandals and smoking pipes, and the standards of corporate governance and risk
management at the UKAEA are some of the best in the world. Its financial
accounts, for example, are as good as any FTSE-100 company’s, according to
White. All the organisation needed, he says, were a few tweaks here and there,
and to reassure the staff that they are actually very good at their jobs. “I’m
trying to instil in all my chaps and chapesses that we’ve got a great job to do.
There must be people out there who wish they were working for the UKAEA as we
are creating value for the community around us,” he says. “As an organisation,
we only really have people. Sure we have a balance sheet with a few fixed assets
and a lot of liabilities, but our real asset is our people. The thinking is
about how we value people in the balance sheet and no one has really cracked

Areas where White has been able to bring commercial thinking into the
organisation include forecasting and reporting, which used to be analytical in
the extreme. “Our forecasts used to go up and down like a whore’s drawers. The
mentality was to get forecasts to the 15th decimal place of accuracy.”
Over-analysis and fluctuating figures meant the DTI didn’t believe that the
UKAEA could plan properly, so the first thing White did was to change forecasts
only when he was convinced it was needed – a skill he learned at GEC. “There I
just told the directors that everything was okay and they needn’t worry about
it,” he says. “I remember my managing director at GEC saying, ‘You frighten me,
Paul. I’ve no idea what you’re doing with these accounts, but the answer’s
always the right one. Keep it up.’ It was all smoke and mirrors. I was just
making the decision we would not let information come out until we were sure it
was absolutely right.”

White now spends considerable effort trying to reduce the time it takes to
decommission the remaining old nuclear power stations at the most efficient
price for the taxpayer – and all without increasing risk. So far the UKAEA has
cut the estimated cost of decommissioning from £6.3bn to £4.8bn and has cut the
end-date of projects by 35 years. “I’m used to sailing close to the wind on
financial numbers when I’m trying to make a profit or loss, but here I have more
responsibility. We?ve got people’s lives in our hands,” he says. “The challenge
is finding more innovative ways of clearing up this nuclear legacy as quickly as
possible – because we must. It’s the easiest thing in the world to leave it for
future generations, but we have a responsibility to do it.” One way White and
his team achieves this is through the use of cutting-edge technology. The other
is to get the organisation aligned with a sense of purpose. “You have to win
people’s hearts and minds,” he says.

White spends a lot of time with the government. The UKAEA’s turnover is about
£400m a year and the government provides more than £300m of that – the largest
portion of spend the DTI makes every year. White has to negotiate hard with
ministers for a bigger slice of the pie every year. “The government wants to
spend more money on hospitals and education, not on nuclear,” he says. But White
stresses that he has been able to teach the DTI more than they have taught him –
especially in terms of accounting. “The government is now using this thing they
call resource accounting, which is real accounting. I’ve been doing that for
years so we’ve been able to teach them – it’s something they don’t understand at
all,” he says.

Unfortunately, the government makes some decisions over which White has no
control. In April 2005, a new body called the Nuclear Decommissioning Authority
(NDA) will take control of decommissioning in the UK because, as White says, the
government had become concerned with the growing problem of BNFL’s balance sheet
that shows discounted liabilities to the tune of £20bn.

The arrival of the NDA will force the UKAEA to compete for decommissioning
business and fight for survival. But instead of changing the culture of the
organisation to get itself in shape for competition, White believes that the
UKAEA should just keep making gradual improvements to its processes. “We are
bringing our programmes forward and we’re forecasting a £1.5bn reduction in our
liabilities for the end of this year. Now, you can imagine that has slightly
upset the NDA because they are saying ‘that’s what we’re here to do’,” White
says. “But do they expect us to just sit here and be cut off at the knees? We
are going to fight back because I get pissed off with these people coming in
from the outside who really haven’t got a clue. I’ve only got 10 years of
experience in the nuclear business, but I’ve learned a lot in those 10 years –
and one thing I know is that this organisation is bloody good at its job.”

With such a passionate and experienced FD at the helm, the UKAEA should be
well placed to stand its ground and protect its employees’ future. The NDA must
be quaking in its boots. As White says: “You ain?t seen nothing yet.”