‘Of course he is polarising’: The relentless rise of Hamish ‘the Hammer’ McLennan

When Hamish McLennan arrived at advertising agency Young and Rubicam Australia as chief executive in 2002, he ripped up the floor, painted the office white and knocked down all the internal walls.

The offices of Y&R were dark, wood-panelled and filled with bad 70s and 80s furniture. McLennan knew it was the first place a potential client would see when they entered the agency. The company also didn’t have any money so he bought new chairs and tables from Ikea. The cost of the reception refit came in under $500.

“We had to symbolise that Y&R had changed,” he says.

McLennan learned about the importance of a grand gesture early in his career working for veteran UK adman Sir Martin Sorrell, who installed him as chairman and CEO of Y&R Australia at just 36. Advertising is about making impressions and it’s a stunt McLennan has pulled off throughout his career.

When he became the global head of Y&R he convinced News Corp boss Rupert Murdoch to attend a dinner with his new advertising clients in New York. He spent his first evening in the Network Ten office sipping vodka with Lachlan Murdoch before dismissing the television broadcaster’s head of marketing, Tony McMaster. When he became chairman of Rugby Australia he appointed an advisory board featuring former prime minister John Howard, former Governor-General Sir Peter Cosgrove and Wallabies legend John Eales to oversee Australia’s 2027 Rugby World Cup bid.

It’s an approach that has served McLennan well. Having started his career in the mailroom of a local ad agency he has accumulated a collection of directorships that makes him one of the most influential figures in Australian business – on paper at least. The 54-year-old is chairman of News Corp’s most important asset, online real estate company REA Group, chair of radio and billboard business Here, There & Everywhere, and deputy chair of $100 billion funds management firm, Magellan Financial Group. And then there is his new role at Rugby Australia, which is arguably his greatest challenge yet.

During his early days at Y&R McLennan became known as “the Hammer”. No one can agree on where it came from. Some colleagues say it was because of his ability to get deals done quickly in the same way a hammer comes down at an auction. Others claim he hammered people who weren’t performing. One person said he was relentless, like a hammerhead shark.

“He’s pretty intimidating,” says Matt McGrath, a friend and former colleague who now runs marketing for accounting firm Deloitte. “He’s obviously tall and he’s a big guy. He doesn’t take any prisoners. He is not a heartless person. He is just absolutely focused on winning.”

Peter Tonagh, the former Foxtel boss who worked with McLennan on the board of REA, has a similar take. “Of course he is polarising, that’s why they call him the Hammer.”

McLennan can give off the impression he doesn’t care what people think about him. But like most executives he worries about his reputation and admits he used to find the nickname unflattering.

“It doesn’t worry me so much now,” he says. “It was all said in jest at the time. We had to turn the company around. It was in a terrible state.”

The origin of the nickname is not the only thing in dispute about McLennan. In the same way his bosses Rupert Murdoch and Sorrell have divided the industry, McLennan is one of the industry’s most polarising executives.

He is respected by some of the 25 current and former colleagues who spoke to The Sydney Morning Herald and The Age for this profile and loathed by others. Several interviews began with a deep sigh or laugh. One call ended when his name was mentioned. Two of McLennan’s most famous bosses – Sorrell and Lachlan Murdoch – refused to comment.

McLennan doesn’t tread carefully. But he is aware of the toll his ruthless approach has on the people he has worked with.

“Obviously there are consequences and these organisations are often broken and need tough calls. I struggle with the human consequence of what happens,” he says.

‘Tough little bugger’

The second of three sons to Colin McLennan, a television producer, Hamish Roy McLennan grew up in a comfortable north shore home in Sydney where programs and marketing were discussed around the dinner table. After graduating from the Sydney Church of England Grammar School (Shore), McLennan skipped university and went straight to advertising agency George Patterson Bates where he started as a mailroom boy. He was required to drive the chairman around and run errands for executives.

“We gave him all the shittiest jobs there were because he was a tough little bugger,” says Alex Hamill, a former advertising executive who hired McLennan.

McLennan took an interest in advertising because it taught him to learn about a range of businesses and how they made money. His first clients were MeadowLea Margarine and Arnott’s.

“I have never been afraid of hard work and I loved the business. I was lucky to be attracted to an industry that I was well suited for,” he says.

McLennan was determined and persuasive and rose up the ranks quickly. Former colleagues say he was able to charm clients. But he could see the industry changing – and consolidating. At this time he met Sorrell, one of the industry’s most famous advertising executives. He was poached to lead Y&R Australia.

McGrath remembers the weekend he and McLennan sat down together to try and win the coveted Telstra account, a client that could change the fortunes of the struggling Y&R. The pair were the last to present to a very tired group of Telstra executives late on a Friday afternoon.

Among the ideas were a fresh set of ads for Yellow Pages, a new approach to bundling products and plans to target young people – a demographic Telstra was struggling to reach.

But first, they needed to make the executives laugh. They began with awkward pictures of them as toothless young children with haircuts done by their mothers. It worked. They won most of the Telstra account.

“We went from zero to $100 million in business in one phone call,” McGrath says.”That was a turning point.”

In the same way McLennan knew how to make an impression, he understood early on the power that comes from being associated with influential figures. In his first few weeks as global chairman at Y&R, he organised a client dinner in New York with Murdoch, who he had been introduced to by then News Corp Australia boss John Hartigan. The clients, who worshipped Murdoch, were fascinated.

During his time in New York he also became known for a series of talks at a popular advertising festival in Cannes. Former US vice president Al Gore, Murdoch, Peter Chernin and Who lead singer Roger Daltrey were among those who appeared at his talks.

“For Hamish it was real brownie points,” says family friend and music promoter Harvey Goldsmith, who launched Live Aid. “All of the media agencies started to invite their big clients to Cannes. Y&R was always a big agency but it became a much bigger global agency under his chairmanship.”

McLennan’s first few years in New York were tainted by a court case in Australia over the sale of advertising agency George Patterson by Pacific Equity Partners to WPP. McLennan was forced to defend himself against accusations of false and misleading conduct. Sources close to McLennan at the time said it caused him distress – he was worried about the long-term impact it would have on his career. The case was settled out of court and McLennan was issued an unreserved apology. The allegations were withdrawn.

When McLennan stepped down from Y&R in 2011, there was speculation he had been dismissed by Sorrell due to a falling out but this was not the case. It was true, however, that Sorrell was unhappy – a combination of McLennan not winning enough clients and struggling to be an effective leader.

“He didn’t live up to expectations,” an advertising executive familiar with the relationship said.

McLennan’s next job was executive vice president, office of the chairman at News Corporation. McLennan did not know Rupert Murdoch before arriving in New York but was familiar with sons Lachlan and James because Y&R had the advertising account for Foxtel, News Corp’s Australian pay TV business. During his stint at News, McLennan was put in charge of a range of tasks – consolidating the newspaper and broadcasting company’s advertising agency accounts into one global group was among them. He also took up the position of chairman of what was a small real-estate company called REA Group, as a way to get more direct management experience.

Working for Murdoch gave McLennan the chance to bring his children back to Australia and commute to and from New York. There are some former colleagues who consider McLennan to be a loner but he is very close to his family.

McLennan met his wife Lucinda at a party in Palm Beach as a teenager. They have two adult children, Olivia and Ted. The family has been a key reason for changes in his career.

“[Lucinda] is my best friend. She backs me 1000 per cent,” he says. “She’s been fantastic – always good counsel. She tells me if she thinks I’m going off course too.”

[Lucinda] is my best friend. She backs me 1000%

Hamish McLennan

Lucinda supported the return to Australia. And a year later he left Murdoch senior’s office to work for Lachlan as chairman and chief executive of Ten. The broadcaster’s chief executive, James Warburton (another Shore old boy), had just been fired. Ten was in bad shape due to poor ratings and a large pile of debt and McLennan had a mandate from its powerful shareholders Lachlan Murdoch, mining magnate Gina Rinehart, WIN founder Bruce Gordon and casino billionaire James Packer to revive it.

McLennan launched new programs including I’m A Celebrity Get Me Out of Here, Family Feud and The Bachelor and landed a broadcasting deal for the Big Bash League and V8 Supercars. A lot of the content slate, including a reinvigorated Masterchef Australia, is still on air at Ten.

One of McLennan’s other well-known acquisitions was the Sochi Winter Olympics. The deal was completed within two weeks – done so quickly that many of his key executives and some board members (but not Lachlan Murdoch) were unaware of it until it was done. At the time Seven thought it had secured the rights, but McLennan could see an opportunity. To the surprise of many, Ten won.

The Sochi Olympics was an extravagant event despite Ten not paying much for it. McLennan invited Packer, Ginia Rinehart (Gina’s daughter) and Lachlan Murdoch as his guests and they travelled in private cars between events. Multiple former colleagues from Ten say the network spent nearly $2 million on entertainment at the Olympics (the rights were bought for about $7 million). Despite smashing revenue records, it only just broke even on the event.

There were endless parties and boozy nights. One party hosted by Ten at the hotel featured some of the industry’s most well-known advertising executives – Russell Howcroft, Peter Vogel, Mark Pejic, John Steadman, James Greet and John and Evelyn Sintras and Sue Squillace who were joined by Ten executives including McLennan and then chief sales officer Lou Barrett. The party went late into the night until the music stopped. McLennan was incredibly disappointed, calling out for the music to continue.

McLennan faced many challenges at Ten. Some of his own making including a court case over attempts to poach veteran programmer John Stephens from Seven. Most Ten executives believed the Stephens job offer was an attempt to undercut chief programming officer Beverley McGarvey, who was heavily pregnant and didn’t know about it. McGarvey, now head of Ten (which currently holds rugby TV rights), and McLennan still do not get along.

The reasons for McLennan’s exit from Ten are still disputed. He had done a solid job turning the network around and his resignation came as a surprise. The press release made the relationship seem amicable – Ten non-executive director David Gordon, who was appointed chairman, said McLennan had led a turnaround in the company’s performance. McLennan received 12 months base pay of $1.975 million over his notice period and another $250,000 “negotiated termination payment”.

Multiple sources who were involved in Ten’s strategy at that time say McLennan fell out of favour with some members of a fractious board by doing deals that they felt went beyond his delegated authority. Sochi, for example. They said he was unable to manage the size of Ten and struggled not to interfere with people further down the chain. An ABC article from the time suggested it was part of an effort to “de-Murdochise” perceptions about the future of the broadcaster.

Others insist it was a cross-media ownership issue. Foxtel had bought 15 per cent of Ten, Lachlan Murdoch had personal shares and McLennan was chairman of REA at the time.

It’s hard to be precise about McLennan’s relationships with the Murdochs. He won’t talk about it and neither will they. His position on the REA board suggests he is close to at least either Rupert or Lachlan. Those close to the family do not agree.

When people who know McLennan speak about his career, they often reference the people he knows. His connections with Sorrell and the Murdochs are a reason why many fear him. But it is hard to sort the myth from reality. When contacted by The Sydney Morning Herald and The Age, Sorrell refused to talk.

Relentless ambition

One thing people can agree on is that McLennan is resilient, works hard and doesn’t suffer fools.

“Mercurial, bullshit-free and possessed of a relentless ambition, McLennan has emerged as the blue-eyed boy of the Y&R empire,” an article on trade website Campaign said in 2006.

Former colleagues from his time at Ten previously told media and marketing trade website Mumbrella that he was a “clinical henchman”. A piece in The Australian Financial Review in 2015 said he spent too much time managing up and that always-on style – late-night and early-morning texts and calls – made him unpopular among his colleagues.

“Hamish smiles upwards and shits downwards,” one Murdoch loyalist previously close to McLennan says. “He’s a user. He can be quite manipulative.”

On one occasion McLennan didn’t like an advertisement for Ten that was emailed to clients. He sent a one-word email around to a handful of his executives: “Pathetic.”

“He is an agent of change,” Hamill says. “He’s quite ruthless and he knows where the problems are. He’s not a person that will take a long time to make a decision about a business. In fact, I suspect he makes it up in the first five minutes.”

McLennan’s relentless management is fueled by five double-espressos a day – usually drunk before 3pm. There are some who appreciate his hands-on over-communicative approach including Tonagh who remembers the hours spent on the phone from LA talking about an investment for REA.

“Every hour until morning once we decided to do it he would call,” Tonagh says. “Anyone who pursues a goal as relentlessly and passionately as Hamish is going to create both fans and foes. I’m in the fan category.”

Anyone who pursues a goal as relentlessly and passionately as Hamish is going to create both fans and foes. I’m in the fan category.

Former News Corp boss Peter Tonagh

Other industry figures say McLennan can be awkward, particularly in social settings. He and his family once turned up to an airing of The Voice (a Nine program) when he was the boss of Ten. In the tribal world of free-to-air television, it was considered very odd to be drinking champagne and wandering around in enemy territory. For his part McLennan didn’t think it was strange at all. He was hoping to see a live Coldplay performance (his kids were fans).

McLennan’s role at Ten was his last as a chief executive and where his machiavellian leadership became infamous. But while he rubs some people up the wrong way, he has a track record of changing organisations. Magellan chairman Hamish Douglass, who met McLennan more than 20 years ago when their kids attended Mosman Preparatory School, says he is “not afraid at all at making the tough calls”.

McLennan does not apologise for getting into the detail even as chairman.

“A good chair should guide and not over manage, but from time to time companies do need a level of intervention,” he says. “I get really invested in the companies and the people and it’s a point of personal pride and reputation that I want to do a good job. I like winning.”

McLennan’s love of work contrasts with his other interests. He is fascinated with Africa and would love to own his own safari park. “We just love being out in the middle of nowhere,” he says. “The bush and the animals – it’s beautiful…[and] there’s an element of danger.”

McLennan has spent most of this year on his family property in Berry (a place where he has hosted many executives over the years). But when he isn’t at the farm, he enjoys skiing, travelling and surfing. He is also fascinated by documentaries and biographies. One of his favourites is Ovitz by Robert Slater, which is about Michael Ovitz, one of Hollywood’s most powerful brokers and former president of The Walt Disney Company.

Blood sport

HT&E chief executive Ciaran Davis was relieved when McLennan decided to take up the role at Rugby Australia. “For a few weeks at least I wasn’t getting 20 phone calls a day – I was getting 10,” Davis laughs.

McLennan got his first taste of rugby union playing fullback at school and still loves to watch the game. But he has become frustrated with what it has become. Wallabies losses, the emergence of large national AFL audiences, lack of free-to-air exposure for the Super Rugby and an inability to innovate the game are among the reasons for rugby’s issues.

Already, McLennan has plans. As well as lodging a bid for Australia to host the 2027 Rugby World Cup, he has proposed two new game concepts – The State of Union and Super Eight – which he hopes will bring professional rugby back to life. McLennan will also have to decide on a permanent chief executive for the game and last Friday announced Australia won the rights to host the 2020 Rugby Championship.

“Most highly ambitious people who are only interested in themselves would not deliberately take on something that is seriously challenging, because you could dent your reputation. That’s not how his ego works,” Douglass says.

Rugby Australia interim chief executive Rob Clarke, who used to battle it out for clients against McLennan when he was leading rival advertising agency Leo Burnett Australia, says McLennan is as formidable as he was in the 1990s and 2000s. He strongly disputes a suggestion by Alan Jones in The Australian that McLennan is too busy for the rugby job.

“Advertising, like rugby, is a blood sport,” Clarke says. “He is here for the right reasons.”

He’s dedicating an enormous amount of time to the task, which is required. That is something that will stand the game in very good stead. He is tackling the major issues, he’s not dodging or sidestepping things such as constitutional reform and governance reform and those meaty topics that can sometimes be put in the too-hard basket.“

Magellan director and former Wallabies captain John Eales, who has known McLennan for more than two decades, believes this role will be his biggest challenge and thinks he is up to it.

“Sport is different to business. People can go in underestimating it and generally if they do, they fail because more people will have a view. Whether their view is grounded in fact or otherwise, their view can get a really disproportionate amount of airtime and that can really complicate things,” he says.

McLennan believes he can help: “There’s a natural conservatism in rugby, which on one hand is good because the history and the global nature of the game is respected. But rugby needs to put pressure on itself to continue to innovate.”