Keith Barton - new power in the Tower

It would be a neat generalisation to see Keith Barton's appointment as Tower chairman as signalling a change of focus for the company.

Barton's predecessor, Olaf O'Duill, was an ebullient Irish banker with a reputation as a turnaround specialist and a willingness to perform painful boardroom and management surgery.

His experience of "remedial situations", as he called them, was just what the insurer needed after a disastrous start to the decade.

Barton made his reputation from a seven-year spell as chief executive of James Hardie Industries, during which time he coaxed fresh vitality from what had become an unwieldy underperformer.

O'Duill helped the patient back on its feet; now Barton can perhaps return it to match fitness.

The pair have outwardly contrasting personalities.

O'Duill appeared in his element parrying querulous shareholders at Tower's often torrid annual meetings during the rocky road to recovery.

Barton, a far less visible figure on Tower's board since his 2001 appointment, came across as far more low key when he spoke to the Business Herald this week from his Sydney home.

Despite his success at James Hardie, he downplayed the notion that he had been appointed to help steer the now stable company through a similarly ambitious growth phase.

"My appointment was simply a matter of my fellow directors asking me to take over. I've been around for a while and had a variety of experiences on various boards, so I think you can assume my colleagues felt I would be an appropriate chairman."

His track record belies his modest, unassuming demeanour.

Born, raised and educated in the rural Queensland town of Toowoomba, Barton studied part-time for his first degree, in chemical engineering at the University of New South Wales, while on a BHP cadetship.

He went on to win a scholarship to study and gain a PhD in philosophy at the same university.

By the late 60s, he was working for the chemical company GD Searle, initially as a production manager. "But these things have a habit of turning into management roles."

After 10 years with Searle, he was working on the company's acquisitions programme, a role he also worked in during two years with Farley & Lewers.

Between 1981 and 1993, he worked for CSR, a sugar company that had diversified into building products.

When CSR was looking for a new chief executive in 1993, Barton was keen, but he was passed over in favour of Geoff Kells.

Not surprisingly, when the top job at rival James Hardie came up the same year, he jumped ship.

Over the next seven years, he sold A$600 million worth of assets to focus the company on fibre-cement products. But probably his greatest success was the company's spectacular push into the US fibre-cement market where, by the late 90s, it dominated the market for housing siding products.

"That was a company that was doing badly and has become a great success in the US," Barton said with typical understatement.

"I think I can take some of the credit for that."

At CSR and James Hardie, former university rugby representative Barton gained a reputation as extremely down to earth and direct.

But his time at James Hardie was not all plain sailing and what would have been a triumphant departure in 1999 was tarnished by the failure of the company's costly plan to list on the New York Stock Exchange.

But, during Barton's time at James Hardie, the company outperformed its peers including CSR.

The growth in the value made it a great investment for its shareholders, including Sir Ron Brierley's Brierley Investments, which finally offloaded its 28 per cent stake for A$570 million in 2001.

Barton retired from full-time employment in 1999 and took up a string of directorships, including chairman of Goodman Fielder in 2002.

He was forced out a year later when Graeme Hart's Burns Philp took over the company.

Barton was appointed to Tower's board in 2001, at the same time Brierley's Guinness Peat Group was taking an interest in the company. Barton admits he had little idea of what he was letting himself in for.

"Although they do due diligence as best they can, most new directors don't get the full story until they get in there."

During those turbulent times, managing director James Boonzaier was forced out abruptly in 2002 and board members, including chairman Colin Beyer, followed. Tower went on to report a loss of $75 million and then a $149 million loss the next year as assets were written down.

Barton, unsurprisingly, confirmed the company's boardroom was not a pleasant place to be then.

"It's always a difficult situation when you have to remove a chief executive. It's not nice but it has to be tackled. You can't just cut and run. You have responsibility to see these things through.

"We had a tough period and I think when Olaf was appointed he had some tough decisions to make. Most of the board was changed as were management and Olaf did a great job."

Although GPG's involvement in Tower has been regarded with suspicion by some, Barton said that was unfounded.

"From the independent directors' point of view, we're extremely happy with GPG. They stepped in when we really needed capital and supported us and management strongly all along. "People can say that they have ulterior motives, but really they're like any other shareholder, they want to get value out of the company. I think shareholders in general should take some comfort that GPG are still in Tower and still strongly support us."

The Australian Wealth Management spinoff last year had been extremely successful and shareholders who kept AWM shares "would be doing very well".

Barton says these days the company's "major reconstruction task" is behind it and an "exciting period of growth in Australia" lies ahead.

Tower acquired South African-owned Australian rival PrefSure this year. Barton says integrating the company is a big job but he's "pretty happy with the way it's going".

RONALD KEITH BARTON

Born: April 11, 1940, Toowoomba, Queensland.
Education: Toowoomba State High School.
Bachelor of Science (Chem Eng), first-class honours, NSW University 1966.
PhD, NSW University 1969.
Married to Lyn.
Three children.
Pastimes: Swimming, running, walking holidays in New Zealand and Tasmania, cycling holidays in France, Portugal, Denmark and Ireland.
Career: 1958 to 1966, BHP trainee cadet chemical engineer, Newcastle.
1969 to 1993, GD Searle, Farely & Lewers, CSR.
1993 to 1999, James Hardie Industries, CEO and managing director.
Previous directorships: Goodman Fielder, Colonial, Keycorp, James Hardie, CSR.
Present directorships: Air Liquid Australia, Amcor, Coles Myer, Vision Australia.