Keir Starmer will speak at the CBI conference in Birmingham this morning. He will do so as the head of a party with a favourite’s chance of winning their first election since 2005.
Rachel Reeves commanding Budget speech confirmed again that Labour means business. Inevitably, there is still commentary about whether Labour is doing enough to recover from the Corbyn aberration. That’s understandable, but it’s also one-sided. An equally important discussion is that some business leaders underestimate how substantially Labour is changing.
It’s striking that only seven current FTSE100 CEOs were in post the last time Labour won an election. And yes, it’s true that lots of CEOs socialised at their first ever Labour conference this year and some will be attending the upcoming sold-out Business Conference, which my firm, Arden Strategies, are sponsoring. Never have so many vegan canapes been devoured in such a noble political cause. The Party’s tone has been set from the top by Keir, Rachel Reeves and Jonny Reynolds. They are supported by sharp intellects in the Shadow Treasury and Business teams, ably bolstered by the Education team and others. But for some, Labour is still a lesser-known entity.
I’ve learned a lot since my time in government and parliament. Foremost is that great businesses are often miles ahead of government – whether Tory or Labour – as change-makers on some of the biggest issues. But it’s also true that business and government are more successful when in a genuine partnership. That’s why in Labour’s economic briefing shared with every frontbencher, the first line is: “Labour is a pro-worker and pro-business party”. And while Labour’s renewed pro-business credentials has generated substantial donations to party coffers, more importantly, it’s also increased high-quality offers of senior private sector secondees to supplement their thinking and organisation.
So, how should business understand Keir Starmer’s Labour? To those seven long serving CEOs I offer these seven reminders, and to those newer in post, I offer these reflections on working in partnership with Labour.
- Don’t view Keir Starmer’s Labour as either a Blair tribute act or a Corbyn burial society. It’s neither of those things today. Corbyn is gone; Tony’s views are warmly encouraged but the party is being reshaped by a different generation.
- Despite the challenging financial circumstances, and perhaps because of them, Labour will be radical. Not in a conventional tax and spend sense, but in demanding high standards, proper governance, societal responsibility, public transparency and much more. No party that has been out of power for so long wins only to then tinker.
- Labour really does want a sustained partnership with business. The party is at its most pro-enterprise since at least 2001. So, if you’re a business leader, don’t think in terms of incremental change, instead rethink on how business and government together can reverse, not ameliorate, Britain’s current malaise. The review led by Lord Jim O’Neill on start-ups is a vivid illustration of how Labour wants to completely reshape policy.
- The top team’s intellectual underpinning is that our country suffers from low growth, driven by low productivity, which is in turn caused by the lowest investment in the G7. They will want to begin turning that around within a first term in office.
- Labour has changed far more than even Keir’s supporters could have hoped. The leadership team currently has greater control within the Party than even Tony did at his high-water mark.
- As CEOs know, Board decisions often involve a mix of very strong characters and it’s the same with Labour – although more complicated. Corporate Britain could better understand the crosscurrents and the role of diverse groups such as Labour Friends of the Forces, Christians on the Left, Scientists for Labour and a multiplicity of other campaigners each of whom have a voice in Labour’s policy development.
- If you have trade unions in your company, your relationships with them should be taken out of a purely HR box. Labour will not interfere or pick sides in individual industrial disputes. But for the first time in almost two decades, we may elect a government that is comfortable listening to thoughtful trade unions on issues as diverse as climate transition, skills, mental health and manufacturing. Counterintuitively, this is an opportunity for British business.
So, while Labour still has more to do to convincingly understand business, now more than any moment in the last two decades, the opposite is also now true.