City & Corporate: Client 'conflict' is a misleading term

Given that there are only five major high-street banks in the UK, four international accountancy firms and three genuinely global investment

banks, rival companies often have to make do with the same professional advisers.

They may not like it but they put up with it, so it was a surprise last week to see that Taylor Woodrow had ditched Maitland as its external consultant because the firm had another housebuilder, Wimpey, as a client. Such clashes are quite common. There was no suggestion that Maitland had failed to manage the potential conflict, but Taylor Woodrow did not feel comfortable and opted to move on.

Without commenting on this specific case, the decision to switch agencies may not be in the client's best interest for there can be benefits in an agency with two similar firms on its books. Consultancies build up specific areas of expertise: some have developed a niche in looking after Lloyd's of London insurance vehicles; others seem to have a lot of investment management clients. And it follows that journalists get to know which PR firms are in which niche. For example, most financial journalists know to approach Maitland as a shortcut to its housebuilder clients.

The other side of the coin is that a PR firm will be 'plugged in' to those journalists specialising in its niche, and will tend to know when a paper is thinking of writing on the subject. That gives its clients greater opportunity for exposure.

There are risks of course. One client may launch a takeover bid for the other, or they might simultaneously get interested in a third. But on the rare occasions when such things happen, they can be managed - as Brunswick found when it was on both sides of the bid for Abbey. Having a PR consultancy with sector expertise ought to be seen as a bonus, not a threat.

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