• Daisy Powell-Chandler

Trade, diplomacy and reputation

This week we finally got to see the Intelligence and Security Committee's report into Russian activity in the UK. For reputation professionals this is the latest in a line of red flags, signs that we live in an era when cross-border commercial relationships are the main route to riches – but also come laden with risk. Nations worry about their reputation because it impacts tourist income and influences the whims of procurement professionals. Geopolitics and cancel culture can also be a dangerous combination for companies.

There was a breathing space between the cold war and 2015(ish) when global commerce was troubling only as part of the debate around moving cheap jobs overseas. Now, even as in-sourcing and onshoring become buzzwords, we are increasingly wary of other dangers. Many large firms won’t let employees take their usual work laptops to Russia; regulators struggle to distinguish between malware and entertainment; and everyone wonders what strings might be attached to Chinese infrastructure investment.

This is a world that seems more ethically complicated at every turn. The main lesson from Nestlé’s baby milk scandal was that companies shouldn’t act irresponsibly abroad and expect to get away with it – offshoring cruelty in return for profit. Numerous arms deals with horrifying regimes have taught the same moral tale. This kind of moral red line was pretty easy to see. But as supply chains have lengthened, distance has made it harder to focus on working conditions, children deprived of education, resources stolen from indigenous people. This now is being slowly rectified by campaigners across the world. The collateral damage is measured in corporate reputation: just ask Boohoo how swiftly these issues can hit your bottom line.

Boohoo's share price over the past month, following accusations of worker exploitation

In these situations, at least, there seems to be a right answer, if only we look deep enough to understand the problems. How, though, are we to tackle companies such as Huawei, who only a scant few years ago were seen as a potential rival to Apple’s grip on the premium smartphone market – and now are being barred from Western supply chains?

Part of the answer is simply this: that us avid newswatchers must translate the anxiety that we see beaming from every news outlet into our risk registers. We must prepare for an era in which the diplomatic nuance might be more complicated – it won’t just be Saudi Arabia and Turkmenistan that raise flags on our corporate communications plans, but an increasing number of satellite states that have planted their allegiance on the other side to us, or that haven’t moved in step with our approach to human rights, or arms control, or police reform.

Amongst many other criticisms in the ISC report is the contention that successive British governments did not do enough to stem the tide of Russian money coming into the UK as investment and with expatriates. The implication for companies here is that it while our recent ethical quandaries have primarily been about the treatment of suppliers, we are re-entering a cold war-type situation where your customers are also suspect. If you thought this was a problem only for dealers of arms and chemicals, think again.

Many corporate communication professionals watch international current affairs as a hobby – that extracurricular activity will increasingly be a crucial commercial asset.


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