Bernie Ecclestone has finally been indicted on corruption charges and will have to stand trial in Germany. Ecclestone was presented with a bill of indictment last summer and was asked to respond to the accusations. The court in Bavaria has now decided to go ahead with the trial. It remains to be seen whether the owners of the Formula One group are willing to accept Ecclestone remaining in his current role. It would be unusual in the corporate world for that to happen, but F1 clearly is not like other businesses and CVC Capital Partners may be worried that the sport will descend into chaos without Ecclestone at the helm. On the other hand they may see this as an opportunity to get Ecclestone to stand aside – perhaps on a temporary basis – and put someone else in charge. This might help them move towards an IPO as quickly as possible. Much would depend on who CVC had in mind to run the business and whether that person would inspire confidence in the investment world and within the sport itself. We will have to see CVC’s reaction. Moving Ecclestone aside may be inevitable because some of the firms that are involved on F1 may not be allowed to do business with people who have been indicted because of corporate governance regulations, which would mean Ecclestone has to go.
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joeblogsf1 
I guess the principle of ‘innocent until proven guilty’, which I’m assuming is the same in Germany as the UK, would mean that Ecclestone could only be put on gardening leave, unless he left voluntarily, as he could potentially sue if kicked-out and is later found innocent?
What is best for the company? Does not the CEO usually do that?
I think many CEO’s are similar to politicians and hang around until pushed (whilst appearing to jump).
Would Bernie Ecclestone have known about this indictment before today? This with respect to the timing of his announcement to buy the Ring yesterday. Or am I imagining a non-existent conspiracy theory?
No just the usual red herring-tactics we know for years. Same with his announcement about “two potential entrants” in 2015, a story which is so vague it can only be a dummy.
Hi Joe, just curious for your opinion, if Bernie had to stand down, would Niki Lauda be capable of replacing him, do you think ?
No.
Adam Parr?
Give respect where respect is due, while contentious Bernie really has been in a league of his own. Can one really look out and clearly see a direct replacement / fit with his skill set – I think not. What could be said is that he moved and organized the sport massively and is delivering a manageable entity to some form of competent corporate successor whom can tweak/fine tune things – not a builder as Bernie has been but a competent manager.
Like him or despise him his accomplishments self serving to the nth degree as they may seem cannot be ignored. Now for some management and equitable resource distribution in future (as mother nature comes a calling) and we’ve got a healthier sport on our hands. B.E masterfully did his part his way (lining his pockets to the detriment of the sport potentially – but thats the management fee)
Hopefully at the inevitable time where mother nature dictates, the next administration can build upon the organization rather than mismanage things back into chaos – the ringmaster while greedy has been a great referee. Missed his calling as a politician then again how many politicians make billions? Well played Mr E.
We don’t know how the sport would have developed without Bernie because he was there. Thus one cannot say no one could have done the same because we don’t know. He did what he did. He feathered his own nest when his job was to look after all the teams. Those with long memories will know that Ken Tyrrell had to be restrained from strangling Bernie when he found out what had happened…
Off the top of your head, do you know of a good published account of what we can know about events of that time?
There isn’t one.
Well, dammit…
What are you doing next winter?
Ron Dennis? Could do worse than he.
Man-management may not be his thing. As a strategic thinker he’s fabulous.
Man management may not be Ron’s thing. but he was always smart enough to bring in the best people to do the jobs he cant. And what gets me about the end of Bernie pessimism that we simply cant live with out him, is behind Bernie is a team. A team of smart people that know how to do there job. Sure he provides the strategic vision and an iron fist of discipline and leverage. But so could Ron Dennis and so could Ross Brawn likely in a different leadership style to Ron. I doubt the whole FOM team is out the door because Bernie takes up residence in a small German room. Someone from outside will be eaten alive before the honeymoon period is over. Someone from inside has a sporting chance of fighting the piranhas when first released in the tank. If they go outside I expect a period of churn in leadership as they rapidly grow disenchanted! You need someone with Joes vision for a better F1 and an iron fist to make it happen. That is the win, win.
How very sad and even sadder to read some of the gloating comments in the mainstream media.
Always remember “let he who is without sin cast the first stone”
I don’t know about you, but I have never been indicted for anything…
Joe,
Should CVC decide that BE should stand aside until this matter is resolved one way or another, have you any thoughts about who they could look at for a replacement. The obvious answer might be Ross Brawn but firstly he may be reluctant to give up his fishing sabbatical and secondly might not accept a possibly temporary position.
Any thoughts or inside information you can share?
Wilson
I believe it would be best to have a smart outsider. I think Richard Scudamore, CEO of the Premier League would be a good man for the job.
Of course David Ward is looking for a job – might make negotiations with Jean Todt interesting. Wilson
If they asked you for a handful of names, who else would be on your candidate list?
Nope.
OK…
Probably a good idea to not PO the folks who would not have made the list…
Someone who has experience of F1, and experience of taking a company to the Markets. Adam Parr?
The idea that F1 would fall into chaos without Ecclestone is a bit of a stretch I think. The world of sports entertainment is not new and I have no doubt that a suitable new ‘leader’ will be found to fill the vacancy. Any tears that are shed over Ecclestones demise may well be crocodile tears.
Please keep in mind I am talking strictly on a business level not on a personal level.
Any sensible business would have pushed him aside already, at least temporarily. That Bernie refused to gracefully stand aside when he was initially indicted makes it equally unlikely he’d do so now.
Bernie certainly knows it’s the smallest of steps from a temporary leave to a permanent one. At his age, they’re be no coming back. The sport will lose by the trial of its acting head, but Bernie himself risks little by staying on.
Given CVC’s prior conduct, it’s a fair guess they lack the temerity to boot Bernie out. Some might think they’re honestly scared of him.
For better or worse, likely worse, the story of the sport for the next 4 months is going to be “the criminal trial of Formula One’s chief”.
How sadly self defeating.
Hi Joe,
Leaving aside who might take over from Eccelestone, I’d be interested to hear your thoughts on what F1 might look like five-ten years after BE has left the room. Do you see a kind of Las Vegas transformation where initial corporate dullness is eventually replaced by more populist entertainment?
No idea.
Of course Bernie could get off. Or maybe just get a gigantic McLaren Style fine. But the implications of him being found guilty open the floodgates to the already substantial head of water (some of it blue) waiting to surge down and wipe him out. Not only that but depending on the findings, CVC could take a huge hit as well if the original deal is found to be corrupt.
There must be a considerable amount of documentary evidence now to be shipped from the UK court to the German equivalent.
I still wonder about the magic fax, his “get out of jail free” card. Was it real?
I did check with a former colleague who still has access to a class 3 fax machine, and we worked out a way to produce such a fax, though the initials on the cover and final page would need to be forged. Thus the honest thought is that it is genuine, if so, why was it not used as the star witness? For a complete forgery the appropriate copies would need to be planted in the correct places with the correct stamps and initials to support the document. Were these not present the document would become highly suspect.
It is not the punishment that is important. It is the outcome. A gigantic fine is still guilty. Investors don’t like that.
Joe a little of topic but
The one thing that gets up my nose is the gigantic fines the large corporates pay in govt. fines to avoid fraudulent activities by employees CEO etc, the reality is it’s the small investor who is paying to keep these people out of jail by using profits that should have been going as dividends.
Seems a empty threat to me if the corporate company who has this rule like Mercedes was to walk away in the next month or threaten to walk away. They have to much money invested in this both as a Engine manufacturer and F1 team to just pick up sticks.
It can be argued that he is innocent till proven otherwise.
I think you will see that this is mentioned in the story
I could well understand if CVC want to move Bernie aside based on the indictment, but surely the standard set by corporate governance rules is actual conviction rather than indictment alone?
I believe that some of the corporate governance rules are based on indictment alone
It is exceptionally rare for the corporate head of a western business to remain in charge during a criminal indictment. It’s so very rare, not a single instance even comes to mind.
At the very least, the head will take a sabbatical. Typically, that’s only in the cases where the head has a controlling interest in the business.
That CVC has not even been able to force Bernie into a temporary sabbatical tells us who is truly in control.
Ross Brawn to step into the gap???? But he’s probably too honest to suit such a role.
Honest?
Sure?
In F1?
too honest for that role…..but no-one is 100% honest…?
Speak for yourself
I think F1 could be in serious trouble, at least in the short-term, if Bernie is removed. I doubt there’s anybody with his wealth of knowledge or contacts who can bring anything together like he does. You’d need at least four or five people that are specialists in their one field and then it would be too corporate – more people equals more debate and nothing ever gets agreed as quickly as it should.
I think the next best person to be Bernie is Gerhard Berger. A wheeler- dealer, with personality and a succesful businessman who is universally liked (from what I’ve read) – Joe what do you think?
I don’t see that myself
One thing that is always mentioned in the context of Bernie is his work ethic, and his ability to put in long hours. Certainly when Berger was a driver, his work rate was never mentioned in a similarly positive light.
Personally hope that a lawyered up Bernie kicks some German arse. If things go south can they incarcerate him? If so why at his stage of life would he give them the opportunity as he could surely vacation in extradition difficult environments. Bernie’s record would suggest being a runner is not in his DNA. ?My hope is he runs circles around them which I would speculate foundations have been put in place for.
While Bernie may be a bit of a moral question mark he is the product of different times a founder and bit of the wild west mentality. As an F1 fan I appreciate his sizeable contribution while recognizing the need for more equitable splits for the health of the sport going forth with new management. One last big deal to be made Bernie, one ensuring liberty.
Because if he runs away everyone in the world would be after the family assets…