In the UK, the debate has honed in on bankers’ bonuses. At the heart of the argument is how to measure individual success in business and whether the bonus system – in the case of Fred Goodwin, a knighthood – is the correct form of reward.
It raises the question whether this current focus on individual accountability is in danger of derailing belief in one of our most valuable assets – UK PLC – at a time when we most need it.
It’s important to keep sight of the fact that it is small businesses and entrepreneurs that historically create the bulk of new jobs in a recovery. And what makes small beautiful? It is the potential to be successful and make money.
Over time, some of these small businesses will grow into huge conglomerates – run by individuals who receive large salaries and bonuses to boot. To get to that point, they will have had to take many risks along the way.
And as most of us know only too well, success or failure of a company rarely relies on an individual – it is about collaboration.
That collaboration can be a force for change and good, as evidenced by the interview we have in this issue with Sir Bobby Charlton, the Manchester United and England football legend.
Sir Bobby has used his fame to work in partnership with businesses and scientists through his charity to find economic solutions to clearing the world of landmines.
There are many similar examples. The question is how to harness individual success? And in business that has to be through collaboration, rather than knee jerk reactions to individual events, which can jeopardise a sector’s very survival. As was recently witnessed in the renewable energy sector where, on running out of cash, the government withdrew funding without notice threatening the very future of a sector that is highlighted as a global priority.
In order to avoid knee jerk reactions that threaten the very foundations of company success, corporate UK needs to grab the initiative and work together to find a more accountable way of rewarding their designated star performers before public sentiment turns against them completely.
As the chief executive of financial services group Tullett Prebon, Terry Smith, said recently, “Capitalism is not a very good system, but it’s the best one we have.”
If you would like to comment on any of the issues raised, or would like us to cover a particular topic in future issues then please let us know. The next issue will appear in March 2012.
Deborah Benn, Editor
editor@insightoutmagazine.com
The opinions expressed are those of the author and not necessarily of Mazars.
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