Hang out with executives from water companies and you’ll quickly learn than everybody loathes Thames Water. Insiders blame the firm for spoiling the reputation of the entire industry. They wonder if Labour’s calls for re-nationalisation would score so well in opinion polls if Thames hadn’t so precisely fulfilled the caricature of a privatised water utility – the one that draws firms as financial engineers who pay fat dividends to offshore owners while short-changing customers.

Not all those peers have pristine records themselves, but you can understand why they point at Thames. The company’s current corporate structure is baffling to ordinary mortals. Two Cayman Islands entities sit below the regulated utility and a chain of five companies stands between the main company and its shareholders. Complexity is one reason why it was impossible for outsiders to calculate the returns made by Macquarie during its decade as Thames’ dominant shareholder. Nobody, however, disputes that the Australian financial house made a packet.

Meanwhile, Thames was fined £8.5m in June for leaking water at a rate regulator Ofwat called “unacceptable”. That followed a £20.3m fine in March for pumping huge quantities of raw sewage into rivers in 2012 and 2013; the judge called the company’s actions “borderline deliberate”.

Things had got so bad that the Ofwat chairman, Jonson Cox, took the unusual step of writing a column in trade paper Utility Week in the summer that called on Thames “to make a step change in the way it operates and behaves”. Cox set out five commitments and urged the company to adopt them “quickly”.

The penny – finally – has dropped. Ian Marchant, former boss of energy group SSE, was unveiled as the new chairman of Thames on Thursday and, reading between the lines, seems to have accepted the job on the condition that the corporate structure is reformed. The Cayman subsidiaries will be closed and the new set-up made “as simple and transparent as possible”.

That should tick one of Cox’s boxes. Other measures, such as getting more independent voices in the boardroom, seem to be in hand. The goal of meeting leakage targets now sounds more credible, even if it probably won’t happen this year.

Time to relax and take comfort in Ofwat’s powers to hold water companies to account? Hardly. It is alarming how often Thames, when it is championing its “new vision”, goes out of its way to emphasise that “new long-term major investors”, such as well-regarded Canadian fund manager Borealis, have taken the place of Macquarie. Cox himself noted Macquarie’s exit in his editorial and welcomed the arrival of Borealis. “Responsible investors can benefit from helping us drive performance up and prices down,” he said.

What are they trying to say? That reform and greater transparency was impossible while Macquarie was on the scene? That the system only works well if “responsible” investors are in control?

If so, outsiders will naturally conclude that the regulatory system has been shockingly weak for years and is still too light. That, rather than simply Thames’ excesses and failures, may explain why nationalisation is suddenly popular.

British Gas share price proffers fuel for thought

Iain Conn, chief executive of Centrica, has already cut shareholders’ dividend once during his three-year stint – by 30%, no less, in 2015. Will he be forced to reach for his axe again? After a 15% plunge in the share price after an out-of-leftfield profits warning, the dividend yield is now an extraordinary 8.7%. Investors fear the worst.

The alarming aspect of Thursday’s warning was that the financial pain was concentrated in parts of Centrica that used to be seen as vaguely reliable. The North American operation, delivering power to big industrial plants, is suffering from fresh competition. The equivalent UK business-focused division is also grumbling about competitors and warm weather and will only break even this year.

By contrast, the UK supply business – the division that may or may not be hit with price caps on energy bills – lost 823,000 customers between July and October but full-year operating profits are still set to match those of 2016. The escapees from British Gas seem to have been those the company didn’t mind leaving – low-margin customers.

Despite the alarm in the share price, the dividend is clearly safe for now. Centrica says cashflow will be “at least” £2bn this year. Capital expenditure is capped at £1bn. That leaves room to pay a dividend costing £650m. Yet, in per-share terms, the dividend is 12p and earnings will be 12.5p. That’s horribly tight.

Attempting to reassure shareholders, Centrica says it is prepared to run with thin dividend cover “for a period of time”. How long is that? Clarity is promised with full-year figures in February, but you can’t blame shareholders for worrying: it’s one damn thing after another at Centrica these days. The share price is 138p. It was 380p when Ed Miliband starting talking about price caps four years ago.

Next joins the Black Friday throng

Proof, in case you needed it, that times are tough for high street retailers: Next, previously a refuge from the Black Friday madness, is joining the throng. Its event may be a restrained affair, at least by the standards of some rivals, and it may just be used as a chance to shift a few slow-selling lines that would have ended up in the Boxing Day sale. But Next, with a view to protecting its brand and its margins, used to be a firm hold-out against Black Friday. The new stance is a weak signal for the whole clothing sector.

