Blog

Prime Ministerial

Published on July 19, 2016

Hubris, commonly translated as insolence, is a word I first came across while studying the Greek tragedies which are based upon it – humans think they are better than they are, take on the Gods and come a cropper.

Listening to the findings of the Chilcott Report, and reflecting on the failure of Cameron to secure a Remain vote, I thought that hubris seemed an appropriate description of their actions.  Like their tragic predecessors they started out modestly, humbly even, making promises of a better future. The problem is that they delivered a good deal of it – investment in public services and a reduction of the deficit – and were re-elected as a consequence.

Like the CEO whose acquisition is successful, they didn’t just have a vision to inspire. Now they had hard evidence of their genius. So Blair aimed at supping with the Gods (OK, OK George Bush, this IS a metaphor) and Cameron thought that he had the Midas touch: “Referendum? Referenda! I’m the master at getting them through.”

These were big risks and the consequences for them personally, when they failed, were tragic. Their own predicament is not our concern. But the fact that they took these risks without managing them – by having no discernible back-up plan if they lost – certainly is our concern. There was no plan to manage Iraq once its command structure had been de-capitated and then immobilised, and no plan to deal with the EU if we decided to leave.

Oops?

No. Good management always involves managing downside risk. FD Solutions’ clients were all advised to hedge their currency risk and my IFA offered a defensive fund in the run up to the referendum, one of only 6 to do so on the platform used by over 2,000. Good long term investors such as the newly emerging Equitile have weathered the storm by choosing companies able to manage themselves through the multiple facets of uncertainty which everyone in Europe, and some beyond, now face.

The main lesson that I’d like to pass on at this stage is the lack of business acumen and risk management in the top echelons of Government. Visionary leadership is one thing but of little value without the capability to deliver it. Aside from Philip Hammond I see no-one in Government with the breadth of commercial experience required to negotiate the biggest de-merger ever undertaken. I suggest that the new Brexit department includes our toughest negotiators such as Lord Sugar, Sir Richard Branson and maybe Sir James Dyson. After all, a new broom sweeps clean! Or is such a comment insolent?