Weary Gent declares

Sir Christopher Gent confirmed yesterday that he is quitting Vodafone, which he has transformed into the world's leading mobile phone company over his near six-year tenure as chief executive.

Sir Christopher, one of the UK's most high-profile businessmen, will stand down in July next year to make way for Arun Sarin, the Indian-born former head of Vodafone's US operations, who is a non-executive director.

Vodafone's chairman, Lord MacLaurin, yesterday paid tribute to his 54-year-old, cricket-loving colleague, who has been with Vodafone since the birth of the mobile phone industry in the early 1980s.

"Chris is certainly one of the best chief executives I have ever worked with and he leaves an amazing business; we ought to be very grateful to him - both Vodafone and the UK," he said.

The news caused a shock in the City and Vodafone's stock closed down 2.75p at 110.25p. Analysts, however, welcomed the smooth succession plan and pointed out that Mr Sarin brings with him crucial experience of the US market, where Vodafone needs to consolidate its position.

Mr Sarin was head of AirTouch when the US mobile phone company was bought by Vodafone in 1999. He became head of Vodafone's operations in the US and Australasia and share options from the deal catapulted him to the top of the UK pay league, with a package worth over £21m for that year.

In his new post, however, he will have to make do with a basic salary similar to the £1.2m that Sir Christopher earned last year. He will, however, be included in Vodafone's executive bonus scheme which could earn him millions over the next three years in share options. Vodafone will also pay his relocation expenses.

Sir Christopher, who will remain as a consultant with the business until his contract ends in December 2003, is not receiving a pay-off but his pension is worth just over £525,000 per year. Suggestions that the appointment of Mr Sarin will end the period of growth that Vodafone has experienced over the past five years were dismissed yesterday by Lord MacLaurin.

"Arun certainly is very aware of opportunities and Vodafone will certainly be acquisitive in the future," he said. "But maybe not at the same intensity as over the past five or six years." That expansion was orchestrated by Sir Christopher with help from Vodafone's finance director, Ken Hydon, who is expected to retire in 2004 when he reaches 60.

Together the two men changed Vodafone from a small European player into a force on the worldwide stage, acquiring rivals such as AirTouch in the US, Mannesmann in Germany and J-Phone in Japan.

They were frustrated last month, however, when Vivendi trumped Vodafone's bid for control of the French telecoms group Cegetel.

Sir Christopher is understood to have informed his colleagues on the board several months ago of his intention to leave the business sometime in 2003.

Following last month's interim financial results, the successful launch of the Vodafone Live suite of data services and the collapse of the Cegetel deal, Sir Christopher decided that the time was right to make a move.

Sir Christopher, who is married and became a father for the fourth time last year, has also grown increasingly weary of media reaction to his salary and bonus packages.

There was uproar two years ago when he was awarded a £10m bonus for the successful completion of the Mannesmann deal.

Foreigners are legion

Arun Sarin's appointment as chief executive of Vodafone came a couple of weeks after the promotion of Todd Stitzer to the top job at Cadbury's. It underlines how many of the UK's senior executive positions are held by non-UK personnel.

One in five chairmen and chief executives of FTSE 100 firms are non-British;12 are Americans, six South African, five Dutch, three Swedish and three Irish. Altogether 26 chief executives and 14 chairmen in the top 100 are foreigners.

Some headhunters put the rise down to increasing globalisation of business; others say it points to a lack of top British talent. Among the first of the high-profile professional managers to come to British business was New Yorker Dick Giordano, who joined BOC in the 1970s. He is still working in British industry, as chairman of BG group, formerly British Gas, and this year became a dual US/UK citizen.

Many investors fear that importing overseas talent, especially from the US, will also mean US-style pay deals, which will set benchmarks for UK senior executives.

History certainly suggests that is the case. The first executive to earn £1m in a year, for example, was Giordano. And some of the biggest pay deals - such as the huge share options package awarded to SmithKline Beecham's Jan Leschly, the package recently demanded by his successor Jean-Pierre Garnier at GlaxoSmithKline and the millions of pounds handed to the bosses of Amvescap - seem to support investors' fears.