Letter from business leaders supporting Labor isn’t star quality – but shows the party is being taken seriously | Business News

The circular letter from business leaders supporting one party or another is a relatively new concept in British general elections.

This is because, until about 30 years ago, business leaders were only too happy to publicly nail their colors to the mast.

Large corporations regularly donated to political parties – mostly, but not always, the conservatives – and individual business leaders were always willing to speak in favor of particular politicians.

This probably reached its zenith in the 1980s, when the likes of Sir Rocco Forte, Lord Hanson and Lord Sterling of P&O were known and prominent supporters of Margaret Thatcher.

The fact that the Labor Party had drifted to the left under Michael Foot made it quite obvious, in any case, which party was considered best for business.

Things began to change when under the leadership of Neil Kinnock Work began to assume a more traditional center-left position and actively seek a closer relationship with companies.

Before the 1992 general election, Labor held fundraising dinners worth £500 a head, and although attendees were mainly showbusiness personalities such as Stephen Fry, there were also a handful of businessmen such as investment banker Jon Norton, who later married Labor Minister Mo Mowlam.

There was also, under Kinnock’s shadow chancellor, John Smith, what became known as the “shrimp cocktail offensive” to woo the city.

It was warmly welcomed by the Financial Times, which controversially supported Kinnock in 1992, but was easily dismissed by Michael Heseltine, the then deputy prime minister, who scoffed that “never have so many crustaceans died for so little”.

Labor efforts to gain business support intensified when, in 1994, Tony Blair became labor leader.

A large number of prominent business leaders, including many from FTSE-100 companies, subsequently publicly endorsed the Labor Party before the 1997 election.

Early support came from figures including Chris Haskins, chief executive of Northern Foods; Lord Hollick, chief executive of United News and Media; and Cob Stenham, chief executive of pulp and paper group Arjo Wiggins.

They were followed in due course by the likes of George Simpson, managing director of the GEC; Bob Bauman, chairman of British Aerospace; Robert Ayling, chief executive of British Airways; Niall Fitzgerald, president of Unilever; and David Sainsbury, chairman of supermarket giant.

Equally valuable were the comments of Sir Richard Sykes, chairman of Glaxo – a former Tory donor – when he told The Guardian in March 1997: “We are not at all afraid of a Labor government”.

It was that election, in 1997, that saw the first circular letter from business leaders endorsing Labour.

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Some 58 senior executives signed them in 1997 and 2001, endorsing Blair.

Although some refused to sign a similar letter before the 2005 election following the Iraq War – among them Psion founder David Potter and bookseller Sir Tim Waterstone – Labor still gathered 63 signatures on a letter to the Financial Times , including big names such as Charles Dunstone, founder of Carphone Warehouse, and Sir Gerry Robinson, chairman of drinks giant Allied Domecq.

This support, however, evaporated at the time of the 2010 general elections and the less favorable climate for companies Gordon Brown had replaced Mr Blair.

Not only did Brown introduce a new top income tax rate of 50 cents, he also antagonized businesses by announcing a 1-cent increase in employer and employee Social Security contributions to be introduced the following spring.

The Conservatives, now led by David Cameronsuccessfully weaponized this last issue in particular.

A letter to The Daily Telegraph, signed by 23 executives, endorsed the commitment to reverse the increase and was signed by leaders of some well-known names, including Sir Chris Gent, chairman of GlaxoSmithKline; Simon Wolfson, chief executive of Next; Justin King, chief executive of Sainsbury’s; and Sir Stelios Haji-Ioannou, founder of easyJet.

To Brown’s embarrassment, two of the signatories – Sir Stuart Rose, executive chairman of Marks & Spencer, and Paul Walsh, chief executive of Diageo – were even members of his own Business Council.

This set the trend for the coming years.

A letter containing 103 signatures was gathered for the 2015 election by Lord Feldman, former chairman of the Conservative Party, with several former Labor supporters – including Sir Charles Dunstone and the theater impresario Sir Cameron Mackintosh – among those warning that “a change in course” under Ed Miliband “would put the recovery at risk”.

Circular letters from business leaders were also distributed with less success before the 2016 Brexit referendum and, when Cameron was replaced by Teresa May in the aftermath, the latter was less obviously disposed to business.

There was no such letter before the 2017 election, while a subsequent attempt later that year to get top executives to support the May government’s Brexit strategy in a public letter was, to put it politely, rejected.

Similarly, in 2019, given the choice between Boris Johnson – who infamously said “fuck business” in 2018 – and the most anti-business Labor leader of all time, Jeremy Corbyn, most executives kept their heads down.

Then today’s letter endorsing the Labor Party It’s a kind of throwback to 2010 and 2015 or, further back, to 1997.

The letter, it must be said, does not have the star quality of business letters of years gone by.

There are only a handful of genuinely high-ranking business leaders from the very recent past, such as former Sky Betting & Gaming chief executive Richard Flint and former Heathrow chief executive John Holland-Kaye, while the only FTSE-100 company represented on the list is JD Sports, whose chairman Andy Higginson is one of the signatories.

And more than one of the signatories – such as Richard Burge, former chief executive of the London Chamber and the Commonwealth Business Council – were already members of the Labor Party.

As the Financial Times said this morning: “Some of the most prominent signatories no longer hold the senior corporate roles for which they are best known, and the UK’s biggest listed companies have largely avoided signing the letter.”

That said, the very fact that the Labor Party put together a letter from business leaders is probably more important than who signed it.

It shows that the party is being taken seriously, at least by the business world, and that it is taking at least some of the business world’s concerns seriously.

The question now is whether this time the Conservatives can muster a letter of support from business leaders themselves. It seems unlikely.