Dual jobs for Graham - New MP to stay on as boss of Paramount
Published:Wednesday | September 9, 2020 | 12:10 AMNeville Graham/Business Reporter
The CEO and managing director of Paramount Trading Jamaica Limited, by all accounts, will be the first boss of a stock market company to take a seat in Parliament as an elected official.
Hugh Graham, who narrowly defeated ex-cop Newton Amos for the St Catherine North East constituency in the September 3 general election, intends to remain as the head of the company he founded three decades ago in 1991 and then took public in late 2012.
Although he would become the first known member of parliament, MP, to run a listed company while also being a lawmaker, other politicians have done so in relation to privately held businesses.
Graham told the Financial Gleaner that he has been preparing for the possibility for two years.
He will be leaning most heavily on second in command and Chief Operating Officer Vaughn Phang, who has been at Paramount for 20 years. But Graham has also been grooming others to take on more responsibility.
“I spent the last two years allowing other persons on the Paramount team to grow, and that included giving them additional responsibilities. We’re at a good point where I can continue shedding some duties but I still have a role to play,” Graham said.
Truth be told, Graham, a long-standing politician attached to the People’s National Party, has been operating that way, to some degree, for 13 years, albeit due to duties at the local government level.
“In 2007 when I was elected as councillor, I was described as a maverick; now I hear that I am an enigma – I am embracing both,” he said.
His lubricants and chemicals company is valued at around $2.3 billion on the market today. Graham started out selling caustic soda from the back of a van and has grown the operation into a lubricants and chemicals distributor, and more recently a lubricants blender and manufacturer of chemical products.
His margin of victory over Amos at the polls was revised from 22 votes to 153, at the last updated ballot count.
“I always say I am satisfied with winning by one vote. I started out selling one bag of caustic soda out of the back of my van, now I am selling hundreds of tons. That tells me that one is enough,” he said.
He adds that the dual jobs of member of parliament and CEO of a public company seem manageable.
To manage both, he plans to increase his 12-hour days to 14 hours, while rebalancing his workload within the time block between his Paramount and political duties.
“I will retain those positions and see how it goes. It is not as if I am a minister where you’re by law required to shed private company responsibilities. I am not aware that as a member of parliament there is any such requirement,” he said.
There is also no requirement for him to do so under stock market rules.
“Our rules do not disqualify a public servant from heading a publicly traded company,” said Managing Director of the Jamaica Stock Exchange Marlene Street Forrest, citing JSE Rule 414 in response to Financial Gleaner queries.
“Rule 414 Corporate Governance Guidelines requires that companies adopt and disclose corporate governance guidelines,” Street Forrest said.
Graham is getting deeper into politics at a sensitive time for the company, whose earnings are being pressured by the coronavirus.
He said Paramount did virtually no business in the fourth quarter ending May, leading to a five per cent or $80 million dip in annual revenues to $1.5 billion.
Net profit for the year fell 15 per cent to $53 million.
The virus was detected in Jamaica in March, and the societal changes that it engendered led to falling demand for products such as lubricants. In response, Paramount has been prioritising product lines that are in demand.
“In view of the fact that we have to now learn to live with COVID-19, we went big in the production of liquid soap and hand sanitisers. This will be the way to go,” Graham said.