Anthony Hilton: Look past shares to regain trust

As the recession recedes, the survivors are emerging from the bunkers to see what is left of the world they once knew.

Anthony Hilton
Anthony Hilton

They may find it a shock. According to Richard Lambert, director general of the CBI and one-time editor of the Financial Times, the old familiar landmarks have gone.

The great casualty of the financial crisis is the reputation not only of the financial sector, but of business in general. Banks may be top of everyone's hate list but, unjust though it is, the wider commercial world has been caught up in the backwash of distrust and cynicism. It has rarely been harder for business to convince the public that it is a force for good.

But Lambert says attitudes have also changed in the boardroom. A survey conducted by the CBI suggested that the collapse of trade credit had made companies appreciate the need to get closer to their suppliers; the collapse of easy growth had made firms appreciate much more the loyalty of customers.

They have rediscovered that there is more to business life than shareholder value. If they want to survive and prosper, they have to be more collaborative, more co-operative and look more to the interests of the wider stakeholder community. Shareholder value, the touchstone of a generation of managers, is now seen no longer to be enough. Indeed, maximising value to shareholders in the short term may mean jeopardising relationships that determine long-term success.

This presents a huge challenge for the financial PR community. For years now it has defined communication in terms of shareholder value - expected profits, areas of growth and share performance. The reputation of chief executives is couched in terms of what has happened to the share price in the time the person has been in charge. There is almost never a mention of customer satisfaction, research and development, employee satisfaction, marketing, nor relationships with suppliers. If Lambert is right and these issues are now becoming centre stage, the PR industry needs urgently to think how this can best be communicated.

- Anthony Hilton is City commentator on London's Evening Standard

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