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The Conversation – December Edition

Dec

Welcome

Welcome to the December issue of The Conversation where our Founder Jonathan Jordan takes a retrospective look at 2014, and ponders on some business predictions for 2015. Sermelo’s new Public Affairs partner Dr. Fiona Murray, CEO of Passerelle Public Affairs, also looks ahead, examining the changing relationship between the UK and the EU.

You can also read about our latest news and what our clients are up to.

With this last Conversation for 2014, the Sermelo team wishes you happy holidays and a very fruitful 2015!

A Word from our Founder

A quick straw poll suggests that for the most part, 2014 has been pretty calm on the home front.  Apart from the nail-biting climax of the Scottish Independence Referendum, the UK has been ‘steady as she goes’ as unemployment has fallen and the economy has strengthened. The fiercest political debate has been around Britain’s future within Europe, and ‘Brexit’ has become a new acronym to add to the lexicon. Doubtless this, mixed with resurgence in regional politics, will be one of the key topics of next year’s General Election. I’m delighted that Sermelo’s partner in Brussels, Dr Fiona Murray of Passerelle, is sharing her insights in The Conversation on how the rest of Europe will view the UK’s demands for change.

If we lift our field of vision beyond our borders, the events of this year present a real and troubling contrast. The war in Ukraine heralds a new chapter in East-West relations, while the on-going destruction of Syria, the emergence of the Islamic State, and the Ebola epidemic, sweeping through West Africa, combine to present one of the most significant humanitarian crises of recent years. We are certainly witnessing unprecedented geo-political shifts, and there are concerns that a gradual retreat from globalisation has begun.

“The Economy, Stupid” was the famous phrase coined by James Carville in Bill Clinton’s 1992 Presidential election campaign. It is of course at least as valid today as it was then. But in our increasingly transparent and digitally empowered world we have to ask the question as to what type of economy do we want? One that creates a few winners and many more losers, or one that allows us to create win-win dynamics by leveraging the new tools that connect us?

I believe the collaborative economy has the power to solve many of the challenges of our age, provided we can manage the myriad of complexity. This is where we can all make a real difference by deconstructing the communications silos and acting as integrators who facilitate positive interaction between stakeholders to deliver pragmatic and workable solutions that yield results.  This, undoubtedly, is our opportunity in 2015 and beyond!

Sermelo News

We are pleased to announce that Scott Walker has joined the Sermelo team and further strengthens the company’s public affairs capabilities.

Scott is a policy, public affairs, corporate sustainability and strategic communications specialist. He started his career as a consultant in London, working at the world’s largest communications agency, FleishmanHillard. There he served a number of major international clients, such as the BBC, Vodafone, Channel 4, BSkyB, News International, and Marks & Spencer, amongst several others. He then moved 'in-house' and managed government, corporate, regulatory affairs, and policy on behalf of the UK music sector.

He has completed a BA (Hons) in Politics and Government, and a Masters in International Relations, both from the University of Kent, UK. In addition, he holds a Law Degree from BBP Law School. He concluded the Executive Master's in Public Administration (MPA) at Columbia's School of International and Public Affairs (SIPA), while working as a freelance policy consultant to businesses, NGO's and academia on various topics related to corporate social responsibility, ethics and compliance, and digital media.

His varied background and expertise in a range of disciplines makes him a fantastic asset to the company as we continue to work on national and international integrated campaigns across different market sectors.

Client News

Nesta

We are proud to announce that we have recently started working with Nesta – the UK’s innovation charity - an endorsed independent charity with a strong mission and drive. Nesta helps people and organisations bring great ideas to life. Nesta provides investments and grants, and mobilises research, networks and skills.

We are working with Nesta to:

  • ensure innovation with a social impact remains on the political agenda
  • highlight the economic opportunities that innovation with a social impact drives across sectors
  • raise awareness of what needs to be in place – in government and industry – to make innovation happen

IKEA

We are thrilled to announce that IKEA was named ‘ICAEW Sustainable Business of the Year’ at the 2014 National Business Awards gala dinner ceremony held on the 11th November.

Focusing on corporate longevity, this prestigious award recognises those organisations that have embedded business sustainability principles and practices, and are reaping the benefits in terms of improved commercial performance, competitiveness, customer perception, staff engagement, and prospects for continued financial strength.

The National Business Awards judges said: “IKEA stood out for us as leaders in their field and we were inspired by the scale of its ambition to have a genuinely net positive impact on the world.”

DeBeers

We were excited to be involved in the global media launch of the ‘Diamond Insight Report’ commissioned by the DeBeers Group. The pioneering research identified the current challenges the diamond industry faces with regards to technology, branding, sales and marketing.

Not only did we reach out to specific target media, employing a clear and coherent strategy to ensure strong and consistent messaging of the report’s findings, but a balance also had to be struck ensuring that the clear communication reached De Beers’ partners in producing countries, as well as their stakeholders around the world.

The launch of the ‘Diamond Insight Report’ generated 364 items of coverage in 14 days with 36,382,000 impressions in total.

The Forum

Sara Benwell, Assistant Editor, Engaged Investor and Pensions Insight

Reflecting on 2014, what do you think are the immediate challenges companies will face in 2015?

For UK companies, surely the biggest challenges will come as a result of what promises to be a very tricky general election. It is increasingly looking like UKIP will cause problems for all three major parties, and perhaps cause all of the parties to think long and hard on what issues they will campaign. While the economic recovery is underway, it is by no means complete and businesses need to prepare themselves for potential shifts in political philosophy, and for new allegiances and coalitions. This could leave us with a very different outlook for 2015.

What government actions could most improve the outlook for businesses going into 2015?

In the finance industry, and particularly in the pensions arena, people are most hoping for a period of continuity. The last year has seen more change than ever before and the financial sector is still struggling to get ready to implement changes ahead of April 2015. There was a collective sigh of relief at a relatively quiet Autumn Statement, but unfortunately, we may see a new tranche of regulation depending on the outcomes of the election. Whoever wins the day, it seems hugely unlikely that businesses will get the period of regulatory calm that they are so hoping for.

What are the biggest challenges facing businesses in 2015 from an economic standpoint?

I think the biggest challenge for all businesses is going to be reputation. 2013 was the year of the horsemeat scandal and the Bangladesh factory collapse, both of which taught us that consumers expect business to take responsibility throughout their supply chain. This year, Malaysia Airlines suffered reputational damage following the loss of two aircrafts. Consumers are better informed and slower to forgive than they have been historically, and I wouldn’t be surprised to see issues like unpaid internships causing huge damage for companies across the UK.

Out and About

Future Shock Event – The Issue of Data

At the end of November, our colleague Tom Clive attended an event called Future Shock, hosted by Nesta, an innovation charity with a mission to help people and organisations bring great ideas to life. One of the talks that he found particularly interesting was centred on data protection and the data issues that will prevail in the next few years. As a society, it seems we face some big challenges ahead when it comes to legislating how much access certain organisations have to information about us.

Data that is deemed essential and important to national security, such as personal identities, salaries and criminal records, is widely accepted as being accessible to governments and various organisations, but what about when data is deemed more ‘personal?’ For example, should personal records be so easily accessible to organisations like Facebook? At what point should we draw the line?

The trouble is that people have differing views on the issue; what is deemed as ‘personal’ data to some is not to others. For instance, a recovered alcoholic would be much more wary of having his/her health records accessible to potential employers.

Part of the problem is rooted in the fact that current policy and legislation is way out of date and doesn’t give organisations enough guidance on what they can and can’t do. As such, speakers at the event concluded that in the fast moving, dynamic world of data, policy needs to change fast and change often.

Royal Society of Arts (RSA) Event – Public Relations: the Master Now

How disruptive has the internet and the digital revolution been to PRs and the media? That was one of the questions that were explored by a panel at a Royal Society of Arts (RSA) event, hosted in association with the Reuters Institute for the Study of Journalism (RISJ) in early December.

The three panellists agreed that the digital revolution has redefined the balance of power between PR professionals and journalists. Big data and digitisation are the main suspects, which in turn have changed the way we consume news and altered the level of trust we have in different stakeholders.

Big data has allowed us to better understand what people want to read and hear about, and this is extremely useful for us, as communication professionals, to devise campaigns accordingly. The media can now adapt editorial lines based on the preferences of their readership. Senior lecturer Trish Evans of the University of Westminster argued that this has transformed the way news is reported. ‘It has become much more demand-driven’, she said.

But digitisation has also resulted in new behaviours in the way we consume information. Senior lecturer John Lloyd of the RISJ argued that PRs don’t need journalists as much as they used to. Companies and organisations are building their own content marketing departments - which don’t look much different to a news team - from where they can communicate directly with their customers. As a result, PR professionals are exploring different ways of getting their stories across. The game industry, for instance, has entrusted key influencers in the gaming community to put out news on their vlogs, rather than seeking to pitch a news story to traditional media.

Insight

New EU – new opportunity for Britain?

A viewpoint by Dr. Fiona Murray, CEO of Passerelle Public Affairs, a Sermelo partner, looking at what’s to come for Britain’s relations with the EU in 2015 and beyond.

Hardly a day goes by without some snippet of press news – usually negative – concerning Britain’s relations with the EU. Whether it’s about the euro crisis or immigration, or more recently the EU budget bill, Britain’s exit from the EU - or ‘Brexit’ - is headline material. Meanwhile, the new EU institutional framework is taking shape. The 700 plus Members of the European Parliament elected in May and the 28 new Commissioners, including Britain’s Jonathan Hill, are rolling up their sleeves and getting on with the considerable task of setting and implementing  the policy agenda for the next five years.  Will Britain be at the table or on the menu?

Recent tensions

Should he be re-elected next May, UK PM David Cameron has promised a renegotiation of Britain’s EU membership with the results put to a referendum in 2017. In a bid to appease dissatisfied Tory backbenchers, a disgruntled British public and stem the rising popularity of UKIP, Cameron is under pressure from home to look tough on Europe.

It has been a year of uneasy relations between Cameron and his fellow EU leaders which included a bid to veto the appointment of Jean-Claude Juncker as Commission President, and more recently, an outright refusal to pay an EU budget bill of Eur2.1 billion (GBP 1.7 billion). Cameron lost the former battle but claimed success in the latter with a halving of the bill and a shifting of the deadline for payment.

In a Brussels event I attended recently, with former UK Defence Minister, Dr. Liam Fox MP, discussion focused on the euro and on immigration as two of the main concerns which the UK Government and people have about Europe. The euro and Eurozone were identified as a threat to the buoyant UK economy and to global financial stability. The impact of immigration on British schools, houses and jobs was also highlighted with a plea for immigrants to fully integrate and contribute to the economy – ‘different is good, separate is not’, quoted one commentator.

Reluctant European

British tension with Europe is not new, however. The UK has a history of uneasy relations with its European neighbours causing Britain to be dubbed the ‘reluctant European’. From the initial accession negotiations in the 1960s, when Britain’s application for membership was twice denied by French President de Gaulle, Prime Minister Margaret Thatcher’s fallout with EU leaders over her demand for a budgetary rebate in the 80s, Britain’s withdrawal from the Exchange Rate Mechanism and opt outs of the Eurozone and the Schengen Agreement in the 90s, the recent  squabbles are only the latest in a long line of similar spats prompting one commentary to pose the question whether Britain hasn’t been ‘leaving’ Europe in slow-motion all along. (Michael Geary, Kevin Lees, E! Sharp, September 2013)

Waning influence

In the European Parliament, Britain’s power has waned somewhat since 2009 when, at the instigation of David Cameron, the UK Conservatives left the largest and most influential political group, the European Peoples Party (EPP) to set up and become the leading party in a new political group, the European Conservatives and Reformists (ECR). The move was intended to protect UK sovereignty. The ECR is more Eurosceptic and less ‘integrationist’ than the two largest political groups, the EPP and the second largest political group, the Socialists (S&D).

Cameron’s string of demands and clashes on various issues has stretched the patience of his fellow EU leaders. Most EU member states desire a Union with Britain, but equally they are anxious to get on with the task of addressing ‘bigger’ issues such as growth and jobs. Even traditional allies, notably the influential German Chancellor Angela Merkel, have drawn back from the UK on points of principle. Cameron was sidelined in May when he wrongly assumed he would have Merkel’s support for a veto on Juncker as Commission President. His talk of restricting immigration has brought a strong response from Merkel, saying she will not compromise on the fundamental EU principle of free movement. As Sir Stephen Wall, former UK Permanent Representative to the EU put it recently, “Mr. Cameron can threaten to take the UK out of the EU. Standing on the cliff edge and threatening to jump will have some people running to his aid, but not at their own peril.” Non EU leaders have also entered the fray. US President Obama has said he wants to continue his excellent relations with a Britain that is part of the EU.

New EU – Britain’s opportunity

Despite the tensions, however, the majority of EU leaders desire a future union with Britain. Commission President Juncker’s allocation to Britain’s Commissioner Hill of the plum financial services portfolio which includes financial stability and capital markets, was viewed as a gesture of good will towards the UK in spite of the earlier veto by David Cameron of Juncker’s appointment. If the move was intended to draw in an increasing critical UK, initially at least it seemed to have achieved its goal. Commenting on the assignment, the British PM said “I think that is a great piece of news because 40% of European’s financial services industry is in the United Kingdom.”

On 1 December, another major piece of the new EU jigsaw was set in place when former Polish Prime Minister, Donald Tusk, took over from Herman Van Rompuy as the new European Council President. Oxford-educated Tusk has stated publicly and forcefully that he wants an EU with Britain, commenting to media following his election in August, “No reasonable person can imagine the EU without the UK.” Brexit has already been identified as one of his top three priorities, in addition to the related economy and euro, and foreign policy. Like Britain, Tusk’s own country, Poland, is a non-Eurozone country and so will have a good understanding of the so- called ‘outs’.

Now that the new EU is in situ, work has started in order to tackle the major issues faced not just by Europe and Britain but by the global economy. Last week, Commission President Juncker unveiled his much touted EUR 300bn investment plan for growth and jobs. Other major issues, such as trade, including TTIP, which may have been sidelined during this year’s reshuffle, will resume priority focus. Europe’s challenges and opportunities are also Britain’s. In the final resort, the UK will have to carefully weigh up whether it has more to gain than to lose by staying at the table.

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