Inside Out

Inside Out - If business is to have a better profile in Britain, we need to rear more flamboyant entrepreneurs - where is the British Bill Gates or Rupert Murdoch?

by ANDREW NEIL, publisher of The Business and The Scotsman
Last Updated: 31 Aug 2010

If business is to have a better profile in Britain, we need to rear more flamboyant entrepreneurs - where is the British Bill Gates or Rupert Murdoch?

A senior BBC executive opined to me recently that the problem with British business is that we have no world-class companies. 'That's nonsense,' I replied. 'We could do with more decent middle-size companies (like Germany), but when it comes to global corporations Britain punches above its weight.'

I sent him the most recent FT list of Europe's top 50 firms, featuring more British entrants than any other country, including Germany and France.

I never heard from him again.

A few months later, after appearing on BBC TV's Breakfast With Frost, Rory Bremner said the problem is that 'the British are not world-class managers. In fact we're not very good at managing anything.'

If that's true, I asked him, how come in the most recent Wall Street Journal survey of the world's biggest firms, Britain comes second (after America) with 12 companies in the list?

Our business executives must be doing something right, I added. Rory had the grace to admit that he hadn't realised there were so many British companies of global stature. But if our opinion-formers and chattering classes have such a low opinion of British management, we should not be surprised if the rest of the country has too.

A recent poll among listeners of BBC Radio 4's Today programme found that company managers were only the 65th most respected profession in the country, out of a total 92. Company directors fared even worse, coming in at 84th. (Full disclosure forces me to report that journalists came below even that - at 88th - but at least we were above politicians, lawyers and estate agents!)

The poll was not scientific, but I fear it's a pretty accurate guide to the low esteem in which business people are held. All the usual British foibles are at work here - envy, class, a cussed attitude towards 'the boss', our traditional disregard for the importance of business and executives to the national welfare.

For those of us in business, I'm not sure there is much we can do about it; indeed, I sense it is getting worse. A more scientific poll for BBC TV's Business Today programme found that 65% thought company directors could not be trusted to tell the truth and 75% thought they were paid too much.

This suggests a resurgence in 'fat-cat Britain' attitudes popular in the 1990s, when executives in newly privatised industries such as electricity and gas earned huge pay-packets.

Railing against fat cats has been given a new lease of life in the post-Enron wave of scandals that rocked corporate America and have clearly had an effect on British opinion too, even though British business has been pretty scandal-free of late in terms of corruption.

But British business has had problems of its own, most notably the downgrading of pensions (of which Equitable Life is the worst example), which has left many people facing retirement on far lower pensions than expected.

Fund managers have not helped the public perception of business either, as ordinary people have watched their investments decline dramatically in the current stock market slump.

So it was perhaps no surprise that when the BBC ran its survey to name the 100 greatest Britons of all time, even our historic great captains of industry were conspicuous by their absence - no Cadbury, Rothschild, Pilkington, Rolls, Royce, Marks or Spencer to be seen.

Richard Branson was one of the few to make it, though not very high on the list, and that gives a clue to British attitudes. We still have a soft spot for flamboyant entrepreneurs who risk all and add to the gaiety of the nation. But we do not think much of captains of industry in pin-stripe suits, no matter how much wealth or jobs they generate for the common good.

Our anti-business attitudes, of course, are self-defeating: one reason Chancellor Gordon Brown has to borrow billions more than he planned is because the collapse in corporate profits has decimated the Treasury's corporation tax receipts.

Another recent development, however, that informs our anti-business attitudes is not entirely illogical. Until the 1990s, the highest-paid executives earned about 40 times the average earner. But the excesses of the 1990s boom meant that those at the top were often earning 400 times the average - and you don't have to be any sort of socialist to believe that such a gulf defies any sense of fairness and undermines social cohesion.

Add to that the fact that some top executives seemed to trouser rewards beyond the dreams of avarice even when they made a complete hash of things - think Marconi or NTL.

The excessive pay of the boom is beginning to unravel.

But if business is to have a better profile in Britain, we will need to rear more entrepreneurs who reach for the stars - where is the British Bill Gates or Rupert Murdoch? - and make sure that those who run our top companies really deserve their huge rewards. Taken together, that might soften our hearts towards big business and our captains of industry - but I would not bet on it.

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