Opinion: Is business no longer Conservative

The apology for a debate about business and politics over the last few weeks is enough to make anyone independent-minded start chewing the carpet in frustration. There was a particularly annoying radio debate between Digby Jones and Polly Toynbee last week. A dialogue of the deaf if ever there was one.

Perhaps it was inevitable that the BBC would continue the traditional assumption that business was always going to be Conservative, but look more closely – talk to business people more broadly – and you find something is shifting.

That is what I’ve been doing at a series of events organised by the investor Joe Zammit-Lucia to bring the political and business worlds together. The result is our pamphlet, published this week, called A Radical Politics for Business.

We argue that the unwritten rule that business should support the conservative status quo appears to be changing. In fact, the major energy of business has shifted behind radical change, and particularly in three areas:

  • Businesspeople are increasingly outward-looking, internationalist, advocates of open borders, free travel and exchange and fresh ideas, when conservatism around the world is at the very least divided on the issue.
  • They are no longer supporting the financial status quo in quite the same way. Quite the reverse, they are backing long-term thinking against short-termism, and an effective banking system – a financial centre geared to support the UK economy rather than speculation.
  • They are overwhelmingly in favour of a new skills agenda which puts confidence, resilience and creativity at the heart of a new relationship between schools and business, when the UK establishment has traditionally failed to look beyond academic elitism and basic skills, happy to let potential practical geniuses eke out their lives as machine-minders.

It hardly needs saying that they are also determined that the UK should stay in the European Union, despite their criticisms of it, when the Conservatives are not.

These are significant politically because all are based on a practical ideology which is politically Liberal. In fact, there is now a case to be made that business is returning to its original Liberal roots – they were overwhelmingly Liberal in the nineteenth century – and that the old relationship between business and conservatism has now broken.

But this is not a call for Lib Dems to become dull and ‘business-like’. It is a bid to re-discover a clear Liberal voice on business, remembering that Liberals and Conservatives see business differently.

Conservatism regards business as supporting the status quo. For Liberals, business has always been about change. It has always involved allowing new ideas to challenge old ones, for new innovations to challenge the entrenched ways of doing things. It has always meant that the small should be allowed to challenge the big.

This clearly isn’t true of every business. And it would be possible to accuse us of bias, or perhaps naivety: both Joe and I are Lib Dem members, though we hold no position in the party. But I hope we can do two things with this pamphlet.

First, to encourage politicians to talk to business or more equal terms – rather more than just: where’s the party donations, or where’s the corresponding tweak in the forthcoming regulations.

Second, to get people talking a little more broadly about the future of business and what it means for politics.

* David Boyle is policy director of Radix, co-director of New Weather, a fellow of the New Economics Foundation, and the author of The Xanthe Schneider Enigma Files and other books.

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11 Comments

  • gavin grant 24th Feb '15 - 5:19pm

    Excellent piece. The Tories fanatical opposition to the EU is driving a wedge in the business community. Many business people have also been “pleasantly surprised” by the Lib Dems in government and the effectiveness of many of our Ministers. If the “In Out” referendum comes to pass it will provide a significant opportunity to develop a liberal dialogue with business. Of course it should also be noted that far more people than ever before are now running their own businesses which is also changing the face of British business.

  • Eddie Sammon 24th Feb '15 - 7:59pm

    Hi David, thanks for the article. I have three points of agreement, four points of disagreement, an undecided point and a final point.

    Points of agreement:
    1. Business is not conservative.
    2. Business wants an active government.
    3. Charging for current accounts is something that needs to be allowed if people want a safer banking system.

    Points of disagreement:
    1. We should not still be pro EU. Farron has the right idea on this with a bit of scepticism.
    2. The pamphlet doesn’t mention foreign policy, including economic sanctions, as a concern for business.
    3. I disagree with getting the big banks to pay for regional banks.They need to build up capital reserves.
    4.We need a simple tax system. Tax breaks for social investments kind of makes them unsocial.

    Undecided:

    Data ownership. I don’t know enough about this to comment yet. I’ve read the bullet points, but I think more reading is required.

    Final point:
    I am lower-middle class and I feel nervous when I the word “radical” a lot. I want a stable government.

    Regards

  • Stephen Hesketh 24th Feb '15 - 8:05pm

    William Hobhouse 24th Feb ’15 – 4:34pm

    ” … I am persuaded that the Conservatives appeal to business people that want to pay as little tax as possible and to those who want to be free from government regulation (perceived or otherwise).”

    I agree William and believe that we must look at making legislative demands in certain (non-critical) areas proportionate to the size of the business and the market it is involved in.

    Also, just as the Tories are likely always to be more pro-big business than our party, the truth is that Liberal Democrat aims and policies have long been more supportive of cooperative and mutual ideals than the other parties.

    We must work hard to ensure that businesses following collaborative models along with small and medium sized enterprises, their employees and leaders, understand our commitment to them as an integral part of our wider commitment to social justice and the environment, local communities and a diverse and thriving economy.

  • Gwynfor Tyley 24th Feb '15 - 10:51pm

    A very good read though I feel that “business” is far too vast a subject to be given any particular political leaning – are we talking about the sole trader, the tech start up or the utilities behemoth?

    What can be given a political characterisation and it would be a liberal one is “successful” business because because the traits set out above are those that, if adopted, would help a business to prosper.

    To my mind the characterisation of business as conservative comes from those behemoths who abuse their monopolistic positions with management more focussed on driving their personal short term gains often at the expense of the long term prosperity of their organisations.

    A liberal government should seek to provide the frameworks that enable those traits whilst at the same time intervening and reforming when markets cease to operate freely and fairly (eg energy).

  • Stephen Donnelly 24th Feb '15 - 11:07pm

    Very good, as usual from David Boyle.

    Many small and medium sized businesses are rooted in their communities, and are very close to their workforce, even if they are privately owned. We should not make the mistake of regarding any form of private ownership with suspicion.

    My accountants inform me that the majority of their private clients do not want to become involved in aggressive tax avoidance schemes. In general I find business people are quite supportive of employment legislation, because it is much easier to work with a clear set of rules, than engage in an adverserial battle with your workforce over every detail. It leaves more time to get on with the things that matter.

    Conservative are for finance rather than for business. Labour simply (with the odd exception) do not understand business. We could reach out, but Liberal Democrats often make the mistake of tarring all private business with the same brush. Small (and medium sized) can be beautiful.

  • I’ll join in the praise – this is a good article.

    Stephen Donnelly “We could reach out, but Liberal Democrats often make the mistake of tarring all private business with the same brush. Small (and medium sized) can be beautiful.” Therelin lies the problem we have as a party. As someone who works for a big business (and a vast number of the population do) big businesses can be pretty good too, but they tend to get denigrated and demonised by the left and centre, which is why sadly businesses tend to be pro-Conservative, even if they are not necessarily in their best interests.

  • Jenny Barnes 25th Feb '15 - 1:29pm

    The Tories are now effectively the party of financial capital only; other sorts of capital need to look elsewhere for their interests to be looked after. To some extent Labour provides a home, particularly for manufacturing, possibly this is the target for the Orange Book LibDems?

  • Stephen Hesketh 25th Feb '15 - 1:39pm

    Gwynfor Tyley24th Feb ’15 – 10:51pm

    Setting aside me never having previously heard of the behemoth (Wiki: a beast mentioned in Job 40 – suggested identities range from a mythological creature to an elephant, hippopotamus, rhinoceros or crocodile), I agree with much of what you say Gwynfor as it constitutes a reasonable approach in encouraging good practice and sustainable behaviour. These are much more important than business size and should include encouragement for reinvestment and industrial democracy and an end to the traits found disproportionately in certain big-businesses of tax avoidance and silly wage differentials/bonuses. A Social Liberal contract.

  • Paul E M Reynolds 27th Feb '15 - 9:36am

    Thanks David. I read your work avidly. On business and banks….

    When in my 20s I had occasion to collect the head of a huge and successful Swiss-based global manufacturing company from Heathrow. In the slow traffic we got into a conversation about banks. He said something like this ‘The job of banks is to take deposits and lend money. A service to business. Don’t let the banks convince you that they can provide all those other services, especially M&A nonsense….they are better accessed through the capital markets or from competitive specialist organisations. Beware of the snake oil’

  • Regulation benefits large companies by stopping growth of SMEs. Every hour a small company spends with dealing with regulation is an hour which is lost to R and D, sales, marketing and analysing cash flow. The EU benefits large companies who can pay for lobbyists. Innovative and fast growing small companies are a threat to large companies , the same way railways were a threat to canals. The reality is that once companies grow to certain size there is a danger of cronyism and manipulation of governments.

    When applying for government funds , many companies find more time and money is spent on the application that whatever they are worth.

    What the government can do is the following
    1. Ask business what the academic ability, technical skills and attitude employers need from people at 16, 18, early and mid 20s, not the leaders of the teachers’ unions.
    2. Allow companies to employ young people for up to 2 years before giving them full employment contracts- see what Germany does.
    3. Turn ex polys to Fraunfhofer Institutes and take 75% of money from arts and humanities degrees and move it into vocational training..
    4. Make sure H and S regulation is sensible and all inspectors have plenty of practical relevant experience and end of tick box culture. Procedures can pass tick box culture and still be unsafe: what is needed is judgement and decision making skills.
    5. Understand that the aristocratic contempt for industry has been replaced or added to by a middle class socialist public sector arts graduate contempt for industry.
    6. Many fast growing companies have shared equity between several people which is a way of persuading people to think about the future.
    7. Good companies attract good staff and keep them. Bad companies with bad staff go bust. Companies with a mixture of bad companies/good staff or good companies /bad staff struggle. Good people who are sought after can invariably leave a company. The best way someone can further their career is to make sure they have the education, technical skills and attitude in a sought after career; that is why chemical engineers have the highest starting salaries of all graduates. No-one is forced to work for an organisation. The best option is obtain the education and technical skills , if one joins an organisation which is poor:learn all that you can, then move on. Working for a bad organisation , if one learns NOT how to do things, can be a very useful education.

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