It’s not all about Brexit
We have been through an incredibly important and vigorous period in British business. The referendum was literally one month before I became Chair, and that really set the frame for businesses headquartered in the UK. With many global companies anchored in London, our CBI community has a role as a national and international organisation. We needed to ensure that our membership was aligned, engaged, and focused on supporting the different issues affecting industries in in the mid- and long-term.
Our biggest issue was, and still is, the underlying performance of the UK economy, and how we can improve productivity and achieve high quality growth. Whilst we need to help businesses tailor their approach, depending on their customer base, value chain and global reach, to do this successfully, and at scale, our CBI members need to be able to speak with one powerful and effective voice.
Looking forwards: technology, capability and diversity
As we advise on a range of Brexit scenarios, we recognise that businesses will be making more conservative investments in London. This will be just one element of their wider contingency and resilience planning. That said, there are three key challenges they need to embrace if we are to see a measured improvement to the UK’s productivity.
- The first is the impact of technology. Businesses need to consider this in terms of their operating models, the speed at which they can digitise, how they gather their insights from analytics, and what proprietary artificial intelligence they can use to be more competitive.
- The second is the reskilling agenda, which is equally important. All employers, from large multinationals to SMEs, need to understand how they can manage, reskill and reshape their workforce in response to the disruption traditional business models are facing e.g. technology
- The final and third challenge will be ensuring they are building diverse, global leadership teams. To remain competitive, businesses need to ensure they have leaders with different experiences and perspectives who can work together to solve increasingly complex problems. The UK economy will see slower growth coming out of Brexit, and we have an imperative to ensure our businesses are more competitive and agile for both existing and emerging trade partners.
McKinsey has been proud to partner with CBI on numerous pieces of thought leadership that touched on these topics. For instance, in 2016, CBI’s report on ‘Unlocking Regional Growth’ highlighted the economic opportunity that is available if our least productive areas are brought in line with their best performing neighbours in the UK. Then in 2017, CBI released a report on improving productivity in the UK, which offers an assessment of technology adoption in the UK, and priority areas for government and business action to address the UK’s failure to adopt. These are just a few examples of the strong relationship we continue to have with them.
Building trust in business
I'm very proud of the role the London Council played in taking an active lead in the CBI's Value of Business Campaign, which is about demonstrating competence, reliability, ability to conduct business profitably and ethically. There is a growing national and political conversation underway about the role of business in society and we need to contribute to this.
We live in a world that demands increasing transparency, both from customers and employees. The promises businesses make are more visible than ever before and can expect to be challenged more readily. Businesses need to be comfortable operating in this environment and leaders must act continue to act with the highest integrity.
It's important to remember that London is not just an economic centre, it's a home. Businesses also need to show they are constructively participating in the community, and actively addressing their important issues - from closing the gender pay gap to supporting local apprenticeships. Trust is about showing action, not just words.
Cultivating a deeper network
Carolyn’s leadership has empowered a cohesive and informed CBI community. Today, we have a larger and more modern agenda that focuses on these key challenges at both a regional and a national level. In the past, it was thought that the big business of London could ‘do it alone’ – that is simply not the case anymore. While London is at the sharp end of the UK’s productivity growth, we can only maintain our competitive position as a country if the regions improve their relative performance.
London is the tenth most economically connected and dynamic city in the world, and the UK is the fifth to sixth most interconnected economy. In a world that is not just interconnected but interdependent, our competitiveness is anchored in our ability to manage and amplify our individual and shared networks. I am proud to see the active role our CBI members play in this, and the resulting growth and engagement in our own networks.
Welcome to Isabel Dedring
I am excited to welcome Isabel Dedring as my successor. Her role in Arup, a long-time member of the CBI, and her background in engineering and technology is vital for helping us achieve the next step in our journey here in London. I look forward to working with you, Isabel, and the whole CBI member network as we continue to collaborate more broadly and deeply.