Russell Lynch: Business needs Olympic spirit

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Thousands of miles away in Rio de Janeiro, the biggest show on Earth is getting under way. The pay-off for the years of training and sacrifice, the early starts and the hard yards is just days away.

Six weeks on from the EU referendum, it hardly needs saying that Britain’s businesses face an Olympic challenge of their own over the months and years ahead.

But if the message of the overwhelming majority of British companies was spurned by the electorate, it’s now up to corporate leaders to ensure that their businesses are honed for the struggles ahead. 

The early mood music from Theresa May has been mistrustful of corporate Britain, tapping into the anger of a public outraged by the most egregious examples of inflated boardroom pay. 

Deals since the vote, such as SoftBank’s £24 billion takeover of chip designer ARM Holdings, have been greeted with as much despair over the fall of a British success story as a celebration of its rise in the first place. 

Of course, the next two years will be uncertain while we negotiate our exit. As the Bank of England said yesterday, the second half of this year will be tough. But this has to be about attitude. The UK is the world’s fifth-biggest economy, and we can’t just shut up shop. 

Companies need to be thinking about how they can still invest and improve, rather than coming up with reasons why they can’t.

So now is the time for British business to show the best of itself; smart and innovative at home, improving productivity, but with an eye to the wider world and new markets, using the advantage of the weaker pound. 

Bank Governor Mark Carney is no miracle worker but his broad package of support should offset at least some of the uncertainty, leaning against the headwinds.

New Chancellor Philip Hammond, meanwhile, should be stepping it up in his Autumn Statement. If he’s got any sense, Hammond will already be working on an extensive package of measures to support business investment through the tax system; he might also make a pledge to stop the constant tinkering with rates that drives chief executives and finance directors potty. Infrastructure spending — on a new runway and at Hinkley Point — would also be a welcome boost.

So now it’s up to businesses to show their mettle, and take the Olympic motto — Faster, Higher, Stronger — to heart. That way we’ll still be on the medal podium, Brexit or no Brexit.

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August 5, 2016 |
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