David McCarthy

Marine Harvest: 1988-1995

Fish Farmer - - Contents -

McCarthy joined Unilever in 1961 straight from Ox­ford Univer­sity and Na­tional Ser­vice and worked over­seas for a num­ber of years be­fore tak­ing over at Marine Harvest in 1988. ‘I had noth­ing to do with fish farm­ing un­til then’, he re­calls. ‘I was in Malaysia for six years and then I spent three years in Chile.’ This was in the mid- to late-Eight­ies. ‘I be­came in­ter­ested in fish farm­ing be­cause at the time Lever Chile was in­tro­duc­ing salmon farm­ing, with all of the ex­per­tise com­ing from Marine Harvest.’

In 1988, McCarthy was asked by Unilever to run Marine Harvest from its Ed­in­burgh of­fice, which at the time had around 30 sites on the west coast of Scot­land. ‘I also had re­spon­si­bil­ity for the Chilean op­er­a­tion’, he ex­plains. ‘When I joined things were very prob­lem­atic. Marine Harvest had a dom­i­nant po­si­tion within the Scot­tish in­dus­try but the com­pany had been ex­pand­ing rapidly and had all of the prob­lems as­so­ci­ated with that. We had too many fish, too many fish on each site, a lot of dis­ease and morale was quite low. I felt that my re­mit was, ef­fec­tively, to turn the com­pany around.’

As McCarthy ex­plains, at the time Marine Harvest was mak­ing huge losses and it was around this time that Unilever made the de­ci­sion to get out of agribusi­ness and, in 1992, sold Marine Harvest to Han­son plc. ‘As part of the deal I stayed to run Marine Harvest’, he says. ‘And, by the time I re­tired in 1995 – when Han­son sold the busi­ness to Booker McCon­nell, we’d turned the busi­ness around and it was start­ing to make money. The seven years I was there were ab­so­lutely fas­ci­nat­ing;

we had to do a num­ber of things in or­der to turn the busi­ness around, they were ex­cit­ing times.’

One of the main chal­lenges was to deal with the fall­out from the rapid ex­pan­sion that took place dur­ing most of the Eight­ies. ‘Once Unilever saw that the salmon pro­duc­tion process worked, un­der­stand­ably they wanted to see a re­turn on the mil­lions of pounds they had in­vested over the years’, McCarthy ex­plained. ‘To that end, my pre­de­ces­sor had been asked to in­crease the num­ber of sites, and the num­ber of fish in each site, in or­der to in­crease vol­ume and, so it was as­sumed, prof­its. Un­for­tu­nately, it wasn’t that sim­ple and the sheer num­ber of fish made it very dif­fi­cult to con­trol dis­ease – fu­run­cu­lo­sis and sea lice to­gether, for ex­am­ple, was ex­tremely dif­fi­cult to con­trol – and the ex­tra staff on each site cre­ated man­age­ment and train­ing is­sues.’

The key to chang­ing things was, as McCarthy says, ‘a mat­ter of get­ting out and speak­ing to the troops. I was also helped by hav­ing very good peo­ple, men such as my col­leagues on the Board, John Lis­ter and An­gus Mor­gan, and Ralph Bail­lie and Steve Bracken on the ground. Af­ter lis­ten­ing to the farm­ers, we went to the top of Unilever and told them we were go­ing to halve the num­ber of fish in each site. We ex­plained that they would lose money ini­tially, but to keep the faith. So, in spring 1989/90 we dras­ti­cally re­duced the num­bers of fish. It took two or three years to get ev­ery­thing right but we were con­fi­dent that we had the right ap­proach.’

Another im­por­tant thing they did at this time was fo­cus on re­duc­ing the stress on their fish. ‘Stress and dis­ease go hand in hand in an alarm­ing way’, says McCarthy. ‘One of the ways in which we suc­cess­fully re­duced stress was stop­ping clean­ing nets with the fish in situ. We be­gan leav­ing two pens empty, into which we would swim the fish whilst we cleaned the nets. Count­ing fish had al­ways been a stress­ful op­er­a­tion. They had to be lifted out of the sea to be counted in a gut­ter by some­one with a clicker, which was very prim­i­tive. So some­body came up with a de­vice that counted, and graded, the fish as they swam from one pen to another. These were all im­por­tant in­no­va­tions.’

One of the other in­no­va­tions dur­ing McCarthy’s lead­er­ship, one that was pi­o­neered by Marine Harvest, was the fal­low­ing of lochs. ‘Wa­ter ex­change on most of the lochs is around 37 days’, he ex­plains. ‘So we de­cided that fal­low­ing the loch for be­tween six to eight weeks af­ter har­vest­ing would sig­nif­i­cantly re­duce the im­pact of dis­ease. How­ever, be­cause there were of­ten more than one com­pany op­er­at­ing on each loch, we also re­alised that fal­low­ing would only work if ev­ery farm on the loch did it, and at the same time. This led to the first man­age­ment area agree­ment with McCon­nell Salmon on Loch Su­nart.’

The com­bi­na­tion of these mea­sures, along-

In 1991, within a few months of putting the smolts to sea, we had a larger biomass than pre­vi­ously with dou­ble the num­ber of fish

side oth­ers such as the in­tro­duc­tion of yearclass sites, pro­duced some re­mark­able re­sults. ‘In 1991, within a few months of putting the smolts to sea, we had a larger biomass than pre­vi­ously with dou­ble the num­ber of fish’, re­calls McCarthy. ‘The fish were grow­ing in­cred­i­bly fast; it was a great mo­ment, and a

to­tal­to­tal vin­di­ca­tion of our ap­proach. It is cer­tainly one of my proud­est mo­ments work­ing for Marine Harvest.’

It is per­haps slightly ironic, McCarthy re­flects, that just at the time it was com­ing to­gether, Unilever de­cided to sell Marine Harvest. ‘I re­mem­ber when the peo­ple from Han­son plc came in to look at the books’, he says. ‘I told them to ig­nore the back data, that the busi­ness was in a good way. And, in­deed, the first month un­der new own­er­ship, Marine Harvest made a profit. The de­mand for salmon had al­ways been there, so once you got the pro­duc­tion right it was a very good busi­ness.’

When McCarthy ar­rived in 1988, the new pro­cess­ing fac­tory at Blar Mhor had just opened. ‘At the time, as well as gut­ted salmon, we were also cut­ting the salmon into fil­lets and steaks and selling them di­rectly to re­tail­ers’, he ex­plains. ‘How­ever, this re­quired ex­tra man­power and equip­ment, and the fact was that the re­tail­ers were giv­ing us no mar­gins what­so­ever. Plus, I felt that there were other pro­ces­sors out there with the rel­e­vant ex- per­tise. Our ex­per­tise was in grow­ing qual­ity salmon quickly, not cut­ting fish. So the last thing I did be­fore the Amer­i­cans took over was close down that part of the busi­ness. It was a dif­fi­cult time, as it led to the loss of 200 jobs, but we felt it nec­es­sary at the time.’

McCarthy left Marine Harvest in 1995 when Booker McCon­nell bought the busi­ness. ‘I was asked to stay on but I de­cided to re­tire in­stead. I had found my time at Marine Harvest an in­cred­i­ble busi­ness ex­pe­ri­ence; a mem­o­rable and ex­cit­ing chal­lenge.

The de­mand for salmon had al­ways been there, so once you got the pro­duc­tion right it was a very good busi­ness”

Clock­wise from top: David McCarthy; McCarthy (cen­tre), with An­drew Grant (left) and Graham Wil­loughby; Marine Harvest Chile HQ

Above: In­spect­ing hatch­ery tanks at Inch­more Hatch­ery, (l-r) Ocke Muller, David MaCarthy, Dave McEwan and another Left: Pro­cess­ing in Chile

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