Who do business leaders speak for, and when are they right to speak?
08 October 2014 -
According to popular perceptions, the political classes alternately quake before or yield to the “voice of business”. But when there are so many business types out there, is that even a helpful term?
Institute of Directors chief Simon Walker spoke plainly at the organisation’s conference last week about the generational struggle facing corporate Britain to defend free-market principles. “The voice of British business must be heard,” he said.
But what exactly is that voice – and who is it speaking for?
It’s a problem that tests business leaders regularly, particularly during major political debates such as that surrounding the Scottish referendum. When should businesses express a view, and when should business leaders themselves step beyond their corporate confines to have opinions of their own?
Businesses have employees and shareholders to consider. And it’s absolutely right that the potential impact of policies on those two constituencies should be relayed to policymakers. But while business leaders may speak for shareholders in relation to specific investments, or speak for employees in relation to their jobs, their arguments may conflict with the interests of other parts of the investment portfolio – or other values held by employees. Isn’t it for shareholders and employees to make their own views known, having weighed up the arguments? That’s what votes are for after all.
For all that, government and the wider population benefit when businesses as entities engage in public debates – presenting arguments that may not be advanced by other collective voices, such as NGOs and political parties themselves. And while NGOs push for the interests of their members and funders, so too should businesses look to protect the investments and jobs of their shareholders and employees. But nobody wins when the “voice of business” is presented or reported as homogenous in all things.
Margaret Thatcher once said there was no such thing as society. Taken fully in context, she was arguing that what matters are people and their families, rather than a more amorphous concept that links them. In a similar way, when someone refers to the views of “business” it begs the question which businesses or which business people? Firms in one sector, or geographic location, will have particular concerns. Firms that work across different sectors may have shared interests in employment law or environmental legislation. But these views are not automatically held by all. There is no such thing as “business” – only the companies that carry it out, the investors that support it with capital and the people who work in it as employees.
The suggestion that British business is a homogenous entity makes it more frightening to those who are naturally suspicious of corporate Britain. Rather than opening their minds to the values of private enterprise, a voice for “British business” can do the opposite – particularly if it is set against the voice of “charities” or “governments”: other easy shorthand that hugely over simplifies complex parts of civil society, and does little to enhance public opinion of any of them.
The danger for big business is that its views end up becoming synonymous not with the majority of the people it employs, or of the shareholders who own it through their pensions, but with the small group of well-paid individuals who run and manage the businesses.
An example cropped up in this interesting piece in CityAM yesterday, which explored the problems Ed Miliband has in persuading people he is pro-business. For Miliband, his policies on particular business sectors – banking or energy for example – are easily seen as policies against business as a whole, which is a problem for him. But the link to the mansion tax proposal as a threat to the directors and managers of big business reaffirms the connection between “business” and “fat cats” in the public imagination and is a problem for business.
Business needs a multiplicity of strong voices able to speak for the staff they lead, or the investors whose money they manage. No sensible leader would equate those responsibilities with an argument about their own circumstances. But when the media and the public at large need simple stories, it’s just as easy for the “voice of business” to be the voice of villains, as that of enterprise and job creation.
Jon Bennett is managing director of corporate communications consultancy Linstock Communications
Image of Simon Walker courtesy of the IoD.
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