Maja Pawinska Sims 06 Mar 2019 // 12:56PM GMT
The Brexit process has so far featured as many barely-believable plot twists as a soap opera. However Brits voted in the 2016 referendum, and whether or not one’s views have changed in the meantime, there can be few of us who are not dismayed that, 24 days out from leaving the EU, the UK still has no clear plan for exactly how it is going to implement one of the most significant changes ever to its way of being in the world.
With political squabbles showing no sign of coalescing into anything resembling clear leadership even as the clock is ticking, it’s perhaps no surprise that this week’s research from the Public Relations and Communications Association demonstrates that the PR industry is also still divided on the best route forward.
The organisation asked The Pulse Business to poll 361 public relations agency heads and communications directors in the UK and ask them one question: “Thinking about Brexit, what would be your preferred outcome?”
There were three bands to the results. Crashing out with no deal – “The UK exits on WTO terms” – was the least popular, garnering 5% of the vote. Extending Article 50 was only a little more appealing, chosen by 9% of comms leaders.
Then there’s a jump to 18% who favour going with Theresa May’s deal – “The UK exits on the Withdrawal Agreement terms agreed by the Prime Minister with the EU” – followed by a bloc of nearly a quarter of respondents – 23% – who would be happiest if “the UK exits but remains in the Customs Union.”
The most popular option – though still not even quite making half of the survey sample – was “Article 50 is rescinded,” which was the preferred outcome for 45% of the PR industry.
The most recent PRCA Quarterly Economic Barometer, in January this year, showed agency heads feeling positive about their own firms and about the wider industry, but overwhelmingly negative about the UK economy. PRCA director general Francis Ingham said: “At the heart of that negativity lies Brexit an issue which PR leaders desperately want to see resolved.”
Ingham points out that in advance of the referendum, 80% of PRCA members said they would vote Remain and only 20% were supportive of Leave, so staying in the EU has always been the preferred choice of the industry. Many in PR, unsurprisingly, want certainty around their business investment, for talent to remain in the UK, and to continue trading under existing arrangements, with freedom of movement.
Omnicom’s president of international growth and development David Gallagher agrees that the least-popular option from the research findings is the least desirable for the business and the industry: “The worst case is a hard-crash no-deal Brexit, because it’s generally associated with wider macroeconomic decline, and whenever uncertainty is introduced into the economy it doesn’t service client budgets well.”
He adds: “For me, every Brexit scenario has limited appeal. There is so much volatility in the market generally that introducing something self-inflicted is probably playing into the sector’s anxieties. Extension of Article 50 has to be a better solution than crashing out, but I can take people’s opinions seriously when they say it’s just kicking the can down the road.”
Whatever their preferred outcome, Gallagher says: “Agency bosses small and large are most worried about the impact on their teams – almost all of us have European nationals on our teams, plus we don’t need trade difficulties when we’re just trying to do a good job for our clients.”
Is there any silver lining to continued uncertainty? Gallagher says: “There is limited upside. I suspect some consultancies have had some success in giving clients advice on managing the process, but I don’t know if that would add up to making up for a bigger economic downturn and what we would lose as an industry.”
A number of PR firms have launched specific services to support clients through Brexit, including Burson Cohn & Wolfe, which launched a “no deal” hotline in January to provide political consultancy and crisis communications support for businesses, where the phone is said to be ringing off the hook.
Gavin Devine, who founded public affairs agency Park Street Partners a year ago, has also picked up work as a result of the continuing uncertainty: “I’m not alone in getting a certain amount of work around Brexit planning and preparedness in the event of no deal,” he says. “The cynic in me might say a delayed Article 50 would benefit some practitioners because it spins out the work.”
Devine, like Gallagher, says the emotiveness of Brexit means that many found it hard to separate personal feelings from objective business reasoning when answering the PRCA’s question. “Arguably, staying in the EU would be better for the economy and therefore budgets to spend on communications agencies, and for the sake of my children I’d like us to be in the EU, but for the sake of my business, at this stage I’d just like any deal to be done as soon as possible.”
And, whatever your personal or professional preferred outcome, he says the most pressing industry issue around Brexit uncertainty is talent – as the Holmes Report explored last month: “The job market is frozen. No-one is hiring and no-one is moving, so at this stage, any deal would be great.”
The impact of the various Brexit scenarios on attracting and retaining talent is also the biggest priority for Rebekah Paczek, managing director of public affairs firm PLMR: “The PR industry relies on being able to attract the best talent, regardless of nationality. Any scenario which either makes it physically and/or economically more challenging to attract that talent – which effectively every single exit prospect does – will have a potentially detrimental impact.
“From the perspective of the industry, the rescinding of Article 50 would enable us all to move on. Although it leaves behind a feeling that perhaps, those from global backgrounds are less welcome than they once were.”
And while politicians debate hard borders, the industry itself is becoming increasingly borderless. Paczek says that while economic uncertainty is never the best environment for professional service firms, international relationships are another challenge: "As we have more and more clients with global interests, we have to be nervous about attracting and retaining clients, a number of which may be looking at moving their headquarters from the UK, and with it their PR accounts.”
Gallagher acknowledges this is another potential influence on the survey results: “Looking downstream, I can see that some sort of negotiated exit could shift client preference to base EMEA hub work outside London. I’m not sure that decades of client behaviour will change overnight and London’s place as the European capital of PR will move to Paris or Berlin, but there is a possibility that there will be some shift in business.”
Ketchum UK CEO Jo-ann Robertson was definitely not among the 5% of survey respondents who favoured leaving the EU on WTO terms: “It would be absolutely catastrophic across the UK to leave the EU with no deal as the disruption to business, and to the UK population, would be immediate and long lasting,” she says.
“Every other option would be manageable, but the PM's objective must be to give business and the markets clarity as soon as possible. I do love the optimism of 45% of our industry that article 50 should be rescinded, but the very practical steps to do that would be almost impossible for Parliament to achieve.”
With just three weeks to go before the UK is due to exit the EU, we’re still no clearer on what the post-March 29 public relations industry will look like in London and continental Europe, in terms of the economy, talent, workflow, trade, budgets and clients. And we're not even clear on what we actually want, beyond, perhaps, wanting all of this to go away and for business as usual to prevail.
And however confused and preoccupied the UK is, Ingham, who is also CEO of the International Communications Consultancy Organisation, points out that it’s not all about us: “Brexit has been the first thing raised at ICCO meetings for the past two-and-a-half years. Many outside the UK feel that we are turning our back on our European partners. They also want some degree of certainty, and there is exasperation that we haven’t decided, this far down the line. We can plan for the future if we know what the future looks like, and, with just three weeks to go, we don’t.”