News that the London International Financial Futures and Options
Exchange (LIFFE) has parted company with its high profile external
affairs director Richard Pratt, and ended its contract with its public
affairs consultancy Hill and Knowlton as part of a wide ranging cost
cutting exercise, couldn’t have come at a worse time.
LIFFE, one of the last havens of traditional ’open-cry’ trading, is
under pressure to modernise. It has already lost market share to
Frankfurt’s electronic exchange DTB and its monopoly in the gilts future
markets is now being challenged by the French. But cutting back on the
management of its external communications during a time of radical
internal change is dangerously short-sighted. Fears are already being
expressed about the future of the City as a centre for European
LIFFE needs to clearly communicate that it is catching up with its
hi-tech European rivals. Chief executive Daniel Hodson flags up the fact
that he has direct links with his head of press relations as evidence of
the importance of PR to the exchange. But amalgamating such specialist
areas as public affairs and product marketing suggests a certain naivety
about the complexities of the communications challenge.
Shandwick, the exchange’s remaining retained agency, has apparently now
been asked to advise on structuring future PR requirements. Hopefully,
its first piece of advice will be that for a forward thinking
organisation cutting back on communications expertise at a time of
crisis is an anathema.