As Simon Walker departs the IoD today, he offers his opinions on the regrettable state of the media, the future of business and the IoD, and a defence of globalisation in an increasingly fractured and divided world in his final column for Director
After five years, this is my final column for Director. I’ve enjoyed it – and my time as director general – immensely. It’s a special privilege to represent IoD members and to have a regular slot to represent our views on the issues facing Britain and the globe. Thank you all.
So what are my impressions from half a decade in the front line for the corporate sector? First, total admiration for the sheer resilience of UK companies. When I joined the IoD, the banking crisis was not long past, and the eurozone was tottering. The ultimate obligation was clear: just “keep buggering on”, in words attributed to Churchill, but most recently used by WPP’s Martin Sorrell after a Brexit that he (and most IoD members) opposed.
So they do. It used to be argued that certainty was business’s key requirement. No longer. ‘Thriving on chaos’ has become a way of life for UK plc – and a comparative advantage over our international competitors. Uber, Airbnb and other disruptors of established business have changed the lives
of workers and consumers forever.
A citizen of everywhere
Listening to the prime minister’s party conference speech, I realised something. I am indeed, globalised: a “citizen of the world”. Born in South Africa, I grew up between Cape Town, Cyprus and London; spent 15 years (and became a citizen) in New Zealand, and lived in the United States and Belgium before ending up in London, while spending as much time as I can in France. I was educated in South Africa, Britain and California. My family is spread across four continents.
I am continually impressed by the range of cultural influences that Britain exerts in each of these countries, and immensely blessed to have enjoyed them. As I leave the IoD after five years, I am eager for more.
Both of my grandfathers left this country well over a century ago, at the time of the Boer War. Like many other ‘Soldiers of The Queen’, they saw the opportunity to live better lives than they might have experienced had they stayed in Yorkshire and Scotland. Good for them – in their modest ways, a policeman and railway worker, they spread British values across the globe, helping this country punch above its weight as it became, not a military or economic power, but the world’s cultural and intellectual centre.
In our era, the mirror image, foreigners flowing into the UK, has placed some strain on the fabric of many local communities. But it is also true that there have been manifest economic and social benefits to Britain as a whole. For a decade, politicians of all parties have avoided real engagement with the issues around immigration and, instead, pandered to perceived public fear and prejudice. It is depressing to hear complaints that all these global citizens “don’t understand what the word citizenship means”. On the contrary, many have come here out of belief in precisely the values that Britain embodies.
Fourth estate failings
As one who led the charge against Sir Philip Green, I was unsurprised when my final interview with Panorama about BHS ended up on the cutting-room floor. Had I used words like “crook”, I’m sure it would have been included. But blending harsh criticism of Sir Philip’s practices with the recognition that defined benefit pension schemes are driving many British companies out of business, that BHS was clearly doomed anyway, and that other groups – lawyers, accountants, the board – were guilty of a failure of governance, does not fit with business coverage that seeks simple heroes and villains.
Douglas Hurd says that the biggest behavioural shift in the 30 years between his time as an adviser to PM Edward Heath and his retirement from parliament was the attitude of politicians to the media. Heath was virtually indifferent to negative reporting. By the Blair, Brown and Cameron eras, it was perhaps the most important regular measure of success.
To me the most regrettable media lapse of my IoD tenure was the BBC’s failure to provide meaningful challenge and analysis around the EU referendum. The balancing of factual, if sometimes exaggerated, claims with risibly untrue assertions around immigration, cost savings and Turkey’s prospective EU membership had a huge impact on public attitudes. So obsessive was the drive to avoid charges of liberal bias, that Britain’s single most important media outlet left its audience in the dark in the first major test of “post-truth politics”.
I loved being a journalist. But I am glad I followed the advice of the roguish Daily Mail owner Lord Northcliffe by “getting out of journalism in time”.
Punch and Judy shows
Inevitably I’ve spent a lot of time dealing with the media. As a former journalist myself, I’m always interested in how business and public policy is covered.
What has dismayed me in my time at the IoD has been the lack of nuance in coverage. Albert Einstein once wrote that everything should be made as simple as possible, but no simpler. Most newspaper and broadcast media, with honourable exceptions, increasingly treat their audiences as simpletons desperate for entertainment. The desire to turn every TV or radio discussion into a Punch and Judy show, and every concept made black or white, permeates broadcasting. I am not alone in being invited on to programmes to “debate” an issue with a trade union or NGO activist, only to be uninvited when a brief discussion reveals that I am not sufficiently virulent in my opposition.
I first became a consumer of UK media in the 1960s when paternalistic tabloid editors like Cecil King and Hugh Cudlipp meant that Sun and Mirror readers were going to learn what lay “East of Suez” and why the bank rate mattered.
As I write, The Sun’s trending lead is “Justin Bieber’s ex flashes her boobs again”. I hope I’m not turning into “Disgusted of Tunbridge Wells” in regretting such shifting trends.
The IoD has many strengths, but its raison d’etre, and unique selling proposition, will always be corporate governance. It was in 1903 that a group of 46 business leaders – all men, alas – met at Moorgate Place under the chairmanship of Judge Bompas, director of the Pelican Life Assurance Company. After seven “Companies Acts” over four decades, they sought “that people may be permitted to deal how and with whom they choose without the officious interference of the state”. The joint stock limited liability company was created in that era. It allowed a separate corporate personality to permit capital to be raised and to protect investors from unlimited comeback if the necessary risks they took went awry.
Times change. Few businesses now use stock markets to raise capital: private equity and vast investment funds are generally a better bet. And the (properly) diversified nature of shareholdings reduces the exposure and (equally importantly) the attentiveness of shareowners. Nowadays other parties may have more to lose than a business’s actual owners. When General Motors collapsed, shareholders were not the principal victims; rather it was support services, parts-suppliers, workers, and the people of Detroit. Cui bono – to whom the benefit? The time is nearing for a review of the way businesses operate and in whose interest. I hope the IoD will be an active participant in the debate ahead.
The IoD does important work fostering best practice in a country whose corporate governance standards are still the best in the world. Our counterparts in IoD Nigeria or the Russian Independent Directors’ Association are the real heroes, demanding ethical behaviour in jurisdictions where neither courts nor regulators are meaningful guarantors of anything. I am stepping down from the IoD but I will stay in touch through my role as chairman of the Global Network of Directors’ Institutes. I look forward to supporting them and our dozens of international colleagues in the years ahead.
Thank you, farewell – and, in the words of Winston Churchill, ‘keep buggering on’!
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Simon Walker served as the IoD’s director general from 2012 to January 2017