Rolls Royce transition shows power of high tech

April 23, 2015 by · Leave a Comment
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Warren East

Former ARM CEO Warren East takes over at Rolls Royce in July

The appointment of Warren East, former chief executive of chip designer ARM, to head up Rolls Royce demonstrates a key shift in the importance of the high tech industries.

The successor to John Rishton, CEO from 2011 to 2015,  came from an extensive international search and shows the importance of microelectronics and embedded software to Rolls Royce which has a large aerospace base in Bristol. The company doesn’t really sell engines, even though it has a £73bn order book for them – it leases many of them and sells ‘time in the air’ instead. This has meant an increasing reliance on monitoring the engines with sensor technologies, security and global software management. All this maps directly onto the skill set of executives like Warren East. As CEO of ARM Holdings from 2001 to 2013 he helped ARM become one of the world’s leading developers of semiconductors with an outstanding record of innovation and a strong commitment to R&D.

Ian Davis, Chairman of Rolls-Royce, said: “I am very pleased that Warren East will become the new Chief Executive of Rolls-Royce following John Rishton’s retirement. Warren has an outstanding record as CEO of ARM Holdings. He is an engineer by training; he has a deep understanding of technology and of developing long-term partnerships. He has proven strategic and leadership skills in a global business and a strong record of value creation.

Warren East said: “I am delighted to be appointed as Chief Executive of Rolls-Royce. It is well positioned in growth markets, with world class engineering skills and a proud record of innovation and delivery. I have a strong desire to return to an executive position with the energy and enthusiasm a role like this demands. The markets which Rolls-Royce serves and the technology it deploys are fascinating. ”

As well as being a Non-Executive Director of Rolls-Royce, Warren East serves as a Non-Executive Director on the Boards of BT, De La Rue, local engineering company Dyson, US memory chip maker Micron and the UK’s Digital Catapult. His intention is to stand down from all but one of his current roles as a Non-Executive Director, in line with Rolls-Royce company policy.

Rolls Royce employs over 54,000 people in more than 50 countries, with over 15,500 of these being engineers. It also has a Land & Sea division for Marine, Nuclear and Power Systems, where projects such as unmanned, autonomous ships are being developed. In 2014, Rolls-Royce invested £1.2 billion on research and development and supports a global network of 31 University Technology Centres. There are over 1,000 Rolls-Royce STEM (Science, Technology, Engineering and Maths) ambassadors who are actively involved in education programmes and activities, and the company has a target to reach 6 million people through its STEM outreach activities by 2020.

East will be paid £925,000 with share incentives up to £1.6m. While at ARM he had a salary of £500,000 but is reported to have left ARM with 450,000 shares worth £4 million from the group’s long-term incentive plan and deferred annual bonus plan.