A licensee, Paul Lee, has died in tragic circumstances as a direct result of health and safety failings at Enterprise Inns.
A two-year inquiry by the Health and Safety Executive (HSE) found that this was not an isolated incident — 474 pubs didn't have the necessary gas safety certificates at the moment of Mr Lee's death in 2007.
Enterprise Inns has explained the situation as a failing of "systems, processes and humans". Compounding the seriousness of this tragedy is that the company was warned by the HSE back in 2001 about its responsibilities.
How could this have been allowed to happen? It links in my mind to a massive issue at play in the leased sector.
Non-interventionist approach
The past 10 years have been an experiment in how many pubs the very large companies can run well.
Year after year they grew their estate sizes and year after year profits ticked up. A tenanted estate profit warning was literally unheard of and share prices soared to quite dizzying heights through the golden years of 2002 to 2007. The business model seemed bombproof.
In the case of Enterprise, there was generally a non-interventionist approach, with management one-step removed from operational nitty-gritty.
Chief executive Ted Tuppen would talk about how the most important thing was the day-by-day dynamism of licensees — everything he was in control of paled in importance by comparison.
The approach was informed by the belief, largely correct, that Enterprise had the best quality leased estate in the UK. Management would talk of how the law of large numbers worked in its favour — and a large, good quality tenanted estate largely looked after itself.
Creaking business model
But something went badly wrong. At around the time of Mr Lee's tragic death, the business model had begun to creak. Pubs were being returned in larger numbers as the recession loomed. I suspect that some, previously on long leases, would have been in pretty poor condition.
The marketplace was changing very quickly indeed — and the law of large numbers began to backfire. What was needed in large numbers was gas safety certificates at pubs on non-substantive agreements — and the manpower, and the reinforced procedures, needed to process them.
As profits came under pressure, what was required was a chunky investment in estate safety management. For a time in 2007 it's clear that the issue had turned away from, "how many pubs is it possible to run well?" to something far more fundamental — "how many pubs is it possible to run safely?"
If part of the art of good management is anticipation, then Enterprise management was failing badly in 2007. There was a paradigm shift happening in respect of Enterprise's responsibilities — and a failure to respond quickly enough. The price was paid with a licensee's life.