Politicians and the media focus too frequently on “sexy start-ups” and the big beasts of the business sector, says Dr Adam Marshall, director general of the British Chambers of Commerce.
The result is that too often the profitable solid citizens of the business middle ground get overlooked. They are “unsung heroes” that may prove among the most durable in surmounting current economic pressures, he says. The BCC, a 250-year-old brand, represents small to big businesses, but Marshall says: “There’s a whole world in between. When businesses quietly get on with it and generate profits and do good things in the community they often don’t get the recognition in the media and political circles they deserve. Yet they are the businesses that are going to be there when we come out the other end of it.”
He says he has not been surprised by the resilience shown by his membership, 52 chambers (not including the discrete Scottish Chambers of Commerce) across the UK, representing thousands of businesses, in the wake of last June’s shock Brexit vote. There has been little panic, with BCC members examining their diverse business models and pragmatically getting on with trading rather than any “monolithic approach where everybody moves in the same sorts of ways. It is ‘take it as it comes’. If you are not proactive and respond to market conditions, you are dead”.
After all, Marshall adds, there have been other sources of major market uncertainty for businesses in the relatively recent past, with the financial crisis and 2008/2009 recession coming to mind. “You must not get distracted by the noise,” he says.
There was certainly some noise and a baptism of fire for Marshall last spring when just a few months before the Brexit vote his BCC predecessor, John Longworth, resigned saying he wanted to be free to give his own views in favour of the UK quitting the European Union. It was incendiary because the organisation was neutral on the issue, representing the diverse views of its members. There were dark mutterings that an incandescent Downing Street demanded Longworth’s head as the price for his audacity.
Marshall, who became acting BCC director general in March, assuming the official mantle last October, says he respected Longworth’s strong personal convictions, but he himself is studiedly neutral in the Brexit debate. “I have to screen out partisans on both sides and focus on what business communities are telling us. Not a lot has happened yet. But anyone who says they know what the ultimate impact will be is peddling their own agenda and own prejudices.”
Similarly, he refuses to be drawn into the pros and cons for business of any mooted second Scottish indyref, apart from expressing the corporate given that the sector likes stability. “I’m not here to weigh into the Scottish political debate. Of course it [a second referendum] would be a cause of uncertainty. But the business community had diverse views before the last Scottish referendum and they have diverse views now.”
Marshall, a 38-year-old American “with a strange transatlantic accent” has been with the BCC for eight years, serving as the body’s executive director for policy and external affairs between 2009 and 2016. Before joining the organisation he built commercial links between industry and universities, and worked briefly in broadcast media. He holds a BA from Yale University and MPhil and PhD degrees from the University of Cambridge.
He says he is an “optimist” by nature, perhaps evidenced by his hope that President-elect Donald Trump will not spark a protectionist trade war that would damage business. “It’s early days and hard to say. But history shows that what is said on the US campaign trail is not always what happens when individuals take office,” the BCC boss adds.
“Trump has positive views on the UK and Scotland. Having someone who has experience of doing business in the UK could turn out a net positive.” Coincidentally, he is joining the platinum 70th anniversary celebrations of the Ayrshire Chamber of Commerce on 10 March at Trump’s Turnberry golf course hotel. He gets up to Scotland to see his members quite frequently.
On the UK business outlook, Marshall may laud the resilience of his members, employing five million in the UK, but he is not wearing rose-tinted spectacles. He says it is clear we are not in any sort of boom time, and the BCC economic forecast for 2017 is for GDP of 1.1 per cent – more pessimistic than the rough City consensus of 1.3 per cent and nearly half the 2 per cent growth the UK managed last year.
Marshall cites the weak UK currency and inflationary pressures, admitting he would “like to be wrong” but that the so-called Goldilocks economic ideal of “not too hot, not too cold” is currently elusive. “It’s too cold,” he says. Many would say he is pushing at an open door when saying that his members would like any move to slightly more normalised interest rates from historic lows of 0.25 per cent to be as gradual as possible. “We are not predicting interest rates will move this year,” Marshall says. “Much depends on how fast the Federal Reserve moves in the US. Historically, the Bank of England has looked at what the Fed does.”
He smiles at what he calls the myth of the BCC as being “grandpa’s lunch club, golf days and hanging baskets (business subsidised) in the town centre”. The truth, he says, is that his members are some of the most dynamic firms in the UK, united by “the glue” of their common regions, often trading with each other, and the chambers giving expert advice and certification advice to members on exporting in uncharted waters. The BCC’s global business network connects exporters with nearly 40 markets worldwide.
“It might be a member says to their chamber, ‘I’m going to Abu Dhabi on business next week, who can I trust, who can I talk to?’ We often have those connections,” Marshall says. “For instance, Glasgow has an amazing relationship with the Manhattan chamber in New York.”
He says the overriding aim of business is to unapologetically make a profit. But he adds that the chambers are vigorously civic-minded, and should be celebrated for being such amid the “noise” of excessive remuneration and corporate governance failures that Theresa May has said she wants to address. Marshall said in his New Year message that this civic spirit might often go recognised because “many of the firms in question aren’t household names and trade on equity markets”.
He accepts that it is legitimate for government to scrutinise careless corporate governance where staff, customers and pension funds often carry the can. But he says the BCC, like other business lobby groups, believes it is important heavy-handed regulation does not add significant costs for firms and deter investment.
Proportionality is the presiding corporate buzzword. “You must not put business people off, it’s a fine line for politicians. There’s too much preaching from politicians to business at local and national level. It would be best for them to work with the grain,” he contends. The director general adds that among his member firms onerous regulation can “have a chilling effect, an emotional reaction, even if not totally logical, that what may start with big business works down the chain”.
However, amid periodic high-profile business scandals (Bhs, Sports Direct etc) one advantage of his own member constituency, he says, is that it is “what local people trust, what they can see and touch on a daily basis. It’s a great thing”.
What preoccupies his members currently? It is certainly not a desire to press for even lower rates of corporation tax following steady reductions from UK governments of all stripes in the past two decades to make British business more competitive. Instead, he talks of what is seen as the one-way upwards escalator of business rates, as well as energy costs, auto-pension enrolment and the apprenticeship levy, for instance.
Marshall says: “None of them feel they are paying too much profit tax. They feel they are paying too much upfront before they do business.”