Last week there was “outrage” over the bonus awarded to Stephen Hester, chief executive of Royal Bank of Scotland. This week we are set for another moral outburst when Barclays announces expected profits of more than $9 billion, which will result in its CEO Bob Diamond pocketing around $3 million. In the midst of a global crisis that heralds austerity for many, what strategy should be adopted by PRs tasked with defending banks, bankers and bonuses?
PRs representing bankers need not concede much ground to the moralists. Instead they should recommend their clients come out fighting. The advice from financial PRs should be: stand your ground; defend yourselves; get the rest of the business community behind you.
If banking clients have doubts about the merits of this approach, PRs should remind them that so far they have been very bad at making a serious case for themselves, which has made it hard for PRs to do so on their behalf. Moreover, bankers need not worry about going out on a limb. There are positive signs that the British business establishment is more than prepared to back British bankers and to condemn the anti-business rhetoric being spouted by the media, protesters and politicians.
This week a leading group of business folk, including Sir Michael Rake, chairman of BT and Easyjet, Sir Andrew Witty, chief executive of Glaxo Smith Kline, and Paul Walsh, chief executive of Diageo, will tell Prime Minister David Cameron to stop bullying CEOs. According to The Sunday Times, one of them will state that if Cameron’s government keeps bashing business:
Eventually companies will leave, and those that stay will not be able to recruit top talent.
That’s the bottom line. The British Establishment’s liberal courtiers are in danger of making the country Mickey Mouse about all this: scapegoating Fred Goodwin, whinging about rather ordinary pay and bonuses for HSBC, Barclays and other bankers.
Hence bankers should tell politicians and the media that the British people and City of London need thriving financial institutions more than they need them. That’s an arrogant message, perhaps. But it has the compelling merit of being an honest one.
PRs have to say forcibly that we need Hester to stay at RBS, and we need HSBC and Barclays to look like credible global businesses capable of attracting the very best to work for them: end of. The rest is noise.
It is unlikely that the public and media can be persuaded to agree with such messaging right now. Yet I doubt that the masses will be pleased over the long term if the liberal commentariats make the moral hazards of doing business in Britain too much for the banking sector to bear. So David Cameron (who can be convinced and needs convincing now) needs to be told that he won’t gain anything by banker-bashing. That pious positioning should be left to Ed Miliband, who is blindly stuffing his portfolio with this unelectable puff.
As several people have remarked, the public will be slightly more in favour of bankers etc. when in a few years’ time, Britain is the world centre of world class bankers. But if we lose this fight to the other side because Britain does not embrace banks and business, Switzerland, where I live, is one of many countries that hopes to profit from the UK’s demise.
Swiss bankers have never been popular in Switzerland. Instead, the Swiss grasp the truth about who needs whom more and why. They have long-acknowledged, however reluctantly at times, what drives business success. They value the benefits that accrue to the wider population as a consequence of allowing their financial institutions to function properly in a global market place.
So as I close this piece, here’s my insight gained from observing Swiss bankers. Bankers need to be trusted more than they need to be popular. To win trust they need to speak straight about the realities of their business. That won’t make them popular. BUT: there’s never been an era in history when bankers and money lenders have been popular. So get used to it; get over it.
Canny PRs have long seen this stuff clearly. To those that don’t yet get it, I say be careful which side you support because the stakes are very high indeed.