Fascinating but very sobering thoughts emerged from a lunch and debate in the FWB Park Brown Boardroom with a number of Non-Executives of leading companies employing tens of thousands across a wide variety of sectors.
We posed a straightforward question for them:
“As business leaders do we feel more vulnerable now than we did back in February 2020? “
Scarily the answer from the group was a resounding “yes “. With soaring energy bills and rampant inflation, hundreds of thousands of jobs could be at risk. Unlike households, businesses are not protected by price caps (separately the question was posed – “when is a cap actually a cap?”) Indeed, some companies coming out of longer term fixed agreements are now faced with a whopping ten-fold increase in energy bills – and quite simply do not generate the income to satisfy this. Many may not survive.
Also discussed was:
- a unique moment in time with significant cost pressures alongside low unemployment
- a prolonged period of great uncertainty combined with politicians of all hue who really don’t have a grip on things and where policy is largely inadequate. Furthermore, all participants found the degradation of standards in public life to be incredibly dispiriting.
- the expectation that all this will lead to social disorder and further mental health challenges not unconnected of course with business failure and job losses. Frustratingly the divergence between the ‘haves’ and ‘have nots’ remains ever increasing.
Everyone certainly agreed that there is now a super-premium to be had on great leadership, great relationships with customers and suppliers alongside strong innovation and funding.
The hope indeed is that we continue to innovate. The response to Covid drove this incredibly well but now we have an array of new challenges with difficult solutions to find. On a practical level the debate included how forthcoming pay rounds are to be managed as inflation rages upwards. We also shared our thoughts around one-off cost-of-living payments as part of this equation. With the inevitability however of a recession and a reduction in current levels of inflation, there will also likely be a greater future emphasis on job security.
In summary it is always a joy to have such an interesting group around the table openly sharing and comparing thoughts and experiences. This joy was more than tinged however with the concern of facing into as hard an economic outlook as we have seen for many a decade.
Incidentally this was the first in-person meeting of the group, curated and created by FWB Park Brown in the early stages of the pandemic, meeting regularly under Chatham House rules. ‘You are on mute’ was certainly not needed on this occasion!