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UTILITY WEEK | 14TH - 20TH JULY 2017 | 9 Interview M el Karam is a pragmatist – a quality Bristol Water needs in a chief executive in the run-up to PR19. The first-time chief executive is a systematic planner who aims to re-form the company into a "global exemplar". Not only that, he has a clear idea of where the water industry as a whole should head – particularly with regard to competition and customer legitimacy. In a small, glass-fronted meeting room at the compa- ny's head office in Bristol, Karam ponders each question put to him before articulating his answer in immaculate detail. He takes the same analytical approach to running Bristol Water (a company that has not always seen eye- to-eye with regulator Ofwat) and tells Utility Week he intends to improve the company's view of itself, as well as how it is viewed by others. Karam acknowledges the fact that things have "not always gone the way they should go" for the company, and is frank about Bristol's past. "Let's be very open and honest about the fact that the history has not been exemplary in terms of relationships," he says. "Any com- pany that ends up in a disagreement with its regulator twice in a row should look carefully at what it's done and what it's doing." For PR19, though, things will be differ- ent. "We do not want to be in those circumstances where we're at odds with our regulator – that is not a good posi- tion to be in." Extensive experience in asset management planning and best practice planning processes led Karam to the role of chief executive. His previous position as global head of asset management at KPMG International, in par- ticular, gave him vital insight into other industries and organisations outside of the UK. "I found that my back- ground experience and skills fitted very neatly with the stage of progress that Bristol Water was at and the needs of the company, and the journey it is going through. That fit seemed to be both strategically and tactically good." Upon arrival in April this year, Karam began by study- ing Bristol's past, "particularly its recent past". His con- clusion was that the company needed to improve its knowledge of its assets, its planning processes, its stand- ing and reputation, and be more "outward-looking". Bristol had begun the process of "changing its ways" to make sure the shortfalls of the previous processes were being addressed before Karam took up the role, and he gives the previous team its due, saying it "moved very quickly" aer the last price review to make changes in the operating model of the organisation. The company's PR14 debacle resulted in a major hit to its revenues in the first year of AMP6. Turnover dropped by £21.9 million to £110.9 million, and profit before tax fell by £9.4 million to £27.8 million. The company rejected its final determi- nation for AMP6, effectively taking Ofwat to the Competi- tion and Markets Authority, but ended up with a measly £20 million upli to its totex settlement – far short of the £128 million it had demanded. Since then the company has gone through a radical transformation at the top. It has a new majority shareholder – Icon Infrastruc- ture – which now owns 80 per cent of the company. This shareholder is "very knowledgeable, very experienced" in the sector, and "understands regulation and regula- tory affairs", says Karam. The fact that it is the majority shareholder, as well, makes the processes and the deci- sion-making framework easier and more aligned with the rest of the business. The company's board has also changed. The structure of the board and the governance has been "strengthened hugely" from where it was in the past price review, says Karam. And a number of new independent non-execu- tive directors bring with them a "wealth of experience" in their fields. The executive team, too, has been overhauled. "We have had our regulatory affairs, our asset management and our corporate affairs, and the way we manage the price reviews through the executive team, completely changed – we have new people running those func- tions, all brought into the company since the last price review." But the effects of the PR14 dispute are still being felt. Prices reduced further in 2016/17, leading to a £0.6