The BBC has appointed one of the UK’s most well-known private equity barons, Sir Damon Buffini, as its deputy chair in the latest move to sharpen the corporation’s commercial focus as the government pursues an overhaul of the licence fee.
The 60-year-old, a founding partner of the global investment firm Permira for more than a decade until 2010, joins chair and ex-Goldman Sachs banker Richard Sharp to plot the financial future of the BBC as it seeks to drive commercial revenues before a crucial renewal of the corporation’s royal charter in five years’ time.
Buffini’s appointment comes days after Michelle Donelan, the culture secretary, told a committee of MPs that the government remains committed to changing the “completely outdated” BBC funding model by 2027.
Options that have been mooted as a potential replacement include a fee added to council tax or broadband bills, or access to content on paid tiers based on a Netflix-style subscription.
The BBC brought in £3.8bn from the licence fee on UK homes that have a TV last year, which the government has frozen at £159 annually until April 2024, which the corporation says is contributing to a 30% cut in income in real terms over the past decade.
Sharp said the elevation of Buffini to the new role of – deputy chair – he has been a non-executive director since November last year and in March was appointed chair of the BBC’s commercial board – represents the “importance of the BBC’s commercial activity to the overall success of the corporation”.
BBC Studios, the corporation’s commercial arm, made record revenues and profits of £1.6bn and £226m respectively last year, funnelling a £135m dividend to bolster the corporation’s finances.
Buffini, the current chair of the National Theatre who headed the board overseeing the government’s £1.57bn culture recovery fund during the pandemic, acknowledged that as the corporation seeks to cut services and jobs its commercial arm needs to ramp up.
“The BBC’s commercial subsidiaries, already successful, have been tasked with a step-change in performance,” Buffini said.
Last year, the government authorised a big increase in BBC Studios’ £350m debt limit, a cap that has been in place for two decades, to £750m by 2027 to enable its commercial arm to better compete with well-funded rivals such as Netflix and Amazon Prime.
Buffini, a key adviser to Gordon Brown when he was prime minister, shot to fame as one of the big figures of the buyout boom of the noughties.
In 2004, Permira’s joint £1.75bn takeover of the Automobile Association motoring group with CVC resulted in him becoming a target of a campaign of the GMB union, which was outraged at 2,800 job cuts. One protest disrupted Buffini’s regular Sunday prayers at Holy Trinity Church in Clapham, south London, disrupted by disgruntled members parading a camel.
The protest was supposed to symbolise the biblical saying that it is easier to thread a camel through the eye of a needle than for a rich man to go to heaven.
While it has been estimated that Buffini has made perhaps as much as £200m over his banking career, his origins chart back to a council estate in Leicester.
The son of an African American father and white British mother, who raised him as a single parent, he went to Gateway grammar school and eventually to St John’s College, Cambridge, from which he graduated with a law degree in 1984.
Buffini later attended Harvard business school gaining an MBA before embarking on an investment banking career at Schroders, whose private equity arm became Permira after he led a management buyout.
Described as talkative, opinionated and gregarious, Buffini once told his private equity partners to be more grateful and made them eat burgers after overhearing them complain about the quality of the food at a Michelin-starred restaurant in a five-star hotel at which they were staying.
Arsenal supporter Buffini has said his hero is Laurie Cunningham, the first black player to don an England shirt, who had a “huge impact” on him as a rare high-profile, successful non-white role model in his childhood.
“When I was growing up I didn’t see many black faces at my school, or on TV,” he said in 2008. “Seeing players like Cunningham star at the highest level, even in the face of horrible racist abuse, suggested that there was a pathway to success for an ordinary black kid from Leicester.”
