"At last there is light at the end of the tunnel.”
Joseph Alsop
In a massive vote of confidence in the United Kingdom, concerted opposition from institutional and personal shareholders – and, it must be said, Share Radio - has made Unilever see sense and stay in this country.
While of course it’s possible to see the issue in isolation - and indeed the company’s management claimed that their proposal to move to Rotterdam had nothing to do with Brexit – Friday 5th October may well be the point at which the fortunes for the United Kingdom and its Conservative Government turn for the better: and this may not altogether be a coincidence.
So this week we look at how the tide is turning: why history may look back on these last few days as the point when the silver lining started to appear, and what we need to do now to seize the opportunity to change the United Kingdom for the better.
The party conferences are now behind us: many expected the Conservatives’ gathering to be particularly torrid, but Theresa May held her nerve and delivered optimism with confidence and good humour.
As if to recognise a job well done, President of the European Commission Juncker made some encouraging noises on Friday: the same day as Unilever announced their decision to drop their move to Rotterdam. The markets sensed a new optimism: the £Sterling started to rise after such a long period in the doldrums and, for the first time in a long time, commentators were discerning a light at the end of the Brexit tunnel.
When we analysed the Government’s White Paper back in July, the logic of our proposed relationship with the European Union was clear to us: so we’re not surprised that, after several months of no doubt careful discussion within the EU Commission, Juncker has reached the conclusion that it contains the basis of what’s needed to go forward.
Meanwhile, careful positioning is taking place in preparation for the ‘meaningful vote’ on Brexit in Parliament. The die-hard Brexiteers are being isolated, and the Government is overtly wooing the centre ground formerly occupied by followers of Blair and Brown. As we saw in Birmingham, the word ‘Opportunity’ is much in evidence, and economic policy is shifting away from austerity to embrace a more ‘one nation’ approach.
But this will take a lot more than freezing fuel duty, revitalising council house building and injecting more money into the NHS, welcome though that is. The Government needs to embrace the egalitarian capitalist agenda which we have been advocating for the past year, including making the free market work for everyone in our society and providing real opportunity for all - and especially for disadvantaged young people.
Fortunately there are detailed recommendations for this agenda, which have been submitted by The Share Centre and The Share Foundation - and I have personally submitted a proposal which includes a voluntary payment system for universal services, for use by higher rate taxpayers.
To reach right across society, the Government needs to recognise the four pillars of egalitarian capitalism: liberty, equality of opportunity, care for others, and individuality. With the exception of the fourth, these echo the rallying call of the French Revolution. However the fourth is essential, as the Blair/Brown Labour Party understood so well when they introduced the ‘All Employee Share Ownership Plan’ and the Child Trust Fund. Both embrace individuality: progressive, asset-based opportunity for individuals - not within pooled arrangements under someone else’s control.
As we explained in last week’s newsletter, Corbyn and McDonnell don’t get this at all. At best, they use it to disguise their real push for union and government domination. Neither did Unilever get it: they were prepared to ride roughshod over individual nominee shareowner rights.
So Philip Hammond would be wise to extend beyond current thinking and take on board these Budget recommendations. They will provide clear evidence that the Government does indeed mean what it says, and is determined to reach out to all across society.
Seize the opportunity - now is the time!
Finally, and in the wake of our experience with Unilever last week, it is essential for the CBI to state clearly to its ‘listed company’ members that they must comply with the law - Part 9 of the Companies Act 2006 - and their obligation to recognise nominee-based shareowners’ corporate governance rights as being equivalent to those on their register. As reported in the Independent last Friday, the London Stock Exchange and PIMFA (the stockbrokers’ trade association) have been asked to make this case to the CBI.
The Government wants UK corporate governance to be much more effective, and Business Secretary Greg Clark has welcomed Unilever’s decision. He will therefore be concerned to ensure that large listed companies do indeed observe the law in future. The good news here, though, is that the law is already in place: we just need compliance.
Gavin Oldham
Share Radio