Top five business moments of 2019

Business moments of 2019
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To say 2019 has been a year of ups and downs would be to make a profound understatement.

Were it a rollercoaster, it would’ve come with a checklist of warnings long enough to put most people off and send them to the dodgems instead. The business world was not immune. In fact, 2019 saw a series of events which directly or indirectly will have consequences likely to linger for years and in some cases, even decades.

Compiling a list of top business events over a year is always going to be a subjective exercise. You may agree with our list, you may feel other events were more deserving of making the cut. Either way, there’s now downplaying the significance of each addition to the Konductor top five business stories of 2019. 

The US and UK v Huawei

Around April time, information relating to a UK National Security Council meeting was leaked to the press. The meeting had been held to discuss the progression of 5G technology and Huawei’s role in supporting the roll-out. With Huawei being a foreign company with a series of lesser known controversies surrounding it, their involvement was stamped as ‘Confidential’. The classification notwithstanding, the information made its way into the public domain and Defence Secretary, Gavin Williamson, the individual charged with the breach, was summarily relieved of his duties.

Even at the time of writing, the decision whether to include Huawei in the UK’s roll-out of 5G remains frozen.

Across the pond, similar issues were surfacing. With Huawei founder and chairman, Ren Zhengfei, having a military background and the 2017 enactment of a Chinese National Intelligence Law stating that organisations must “support, co-operate with and collaborate in national intelligence work”, the Americans too were becoming dubious of the inroads Huawei were making into their market.

A breakdown in diplomatic relations between the two superpowers led to an ongoing tit-for-tat imposition of various tariffs culminating in the Trump administration adding Huawei to a list of companies that American firms cannot trade with unless they have a licence.

However, in November, US Commerce Secretary Wilbur Ross confirmed in an interview with Bloomberg that they are on phase one of a trade deal with China, after which, US companies will be allowed to work with Huawei.

Tentatively resolved in the US at least, the Huawei sagas were still major business flashpoints of the year.

 

Extinction Rebellion

The need to become more sustainable in all aspects of life has been a hot topic for some time now. In business, certainly most large corporations and many SMEs have developed comprehensive green policies and failing to demonstrate sufficient commitment to environmental improvements can and has cost some organisations market share.

In 2018, spurred by what they saw as an unacceptable ambivalence to the climate crisis, a small group of environmental activists established a movement called Extinction Rebellion. By 2019, there was no-one who hadn’t heard of them. The group quickly evolved from organising minor street protests to staging mass roadblocks, occupying government buildings, gluing themselves to immovable objects and even spraying the Treasury in London with 1,800 litres of fake blood.

Demonstrations on the 16thApril at Oxford Circus, Marble Arch, Waterloo Bridgeand the area around Parliament Square were so disruptive that, by the end of the day, 290 activists had been arrested and an estimated half a million people had been affected.

Whether or not Extinction Rebellion are achieving their stated aims is debateable, but there’s little doubting that they’ve brought the issue of climate change to the fore. The impact this will have on business will become more evident over the coming years.

 

Thomas Cook

A major business going to the wall is always going to be newsworthy, but few have ever hit the wall with such howling ferocity and din as Thomas Cook Group in September of this year.

The company had become such a stalwart of the UK travel sector, it was hard to imagine it without them. However, though many were aware that the company was treading turbulent waters following a series of mismanaged mergers and acquisitions, precious few knew the full picture, that Thomas Cook had run up debts of over £1.5BN.

As takeovers fell through and government bailouts were rejected, the inevitable happened and on the 23rdof September – to the shock of the nation – Thomas Cook Group and all UK entities went into compulsory liquidation and immediately ceased trading. In a heartbeat, approximately 21,000 worldwide employees, including 9,000 in the UK, were left without jobs. Moreover, 600,000 customers – 150,000 from the UK – were left stranded abroad, triggering the UK’s largest peacetime repatriation.

Thomas Cook served as a cautionary reminder for the business world; however big and long-standing you are, you are still only a handful of bad decisions away from disaster.

 

Bury FC

English football has been a game of the haves and the have nots for some time now. The founding of the Premier League in 1994 saw record levels of investment come into the English game. As the top clubs boosted their coffers with TV revenues and cash injections from foreign investors keen for a slice of Premier League pie, further down the pyramid, a grimmer picture was being painted.

As the noughties progressed, warning signs that all was not well outside of the top division began to emerge. Clubs of the stature of Leeds United, Portsmouth and Oldham Athletic variously suffered points deductions and winding up orders only to be saved at the final hour. It seemed though, that a fatal casualty was inevitable. On the 27thAugust 2019, it came.

League 1 Bury FC had been struggling financially for some time. A takeover by local businessman, Steve Dale, appeared to have saved the club, but all was not as it seemed. Reports of unpaid wages began to surface, and Dale soon took to the press claiming that the financial situation was worse than he’d realised prior to taking the reins. Unable to fulfil their opening fixtures of the 2019/20 campaign, EFL patience reached breaking point and Bury were summarily expelled from the football league.

Though still technically operating as a business, Bury’s expulsion elucidated how hostile the environment is away from the bright lights and pots of gold of the Premier League.

 

UK General Election

General elections are always a nervy time for business. Whichever party is able to form a majority usually does so promising regulatory changes which necessitate reviews of compliance procedures and budget allocations. The 2019 general election offered the same but on anabolic steroids.

The most divisive election in living memory pitted the left wing, Jeremy Corbyn-led Labour party against the right wing, Boris Johnson-led Conservatives. Brexit dominated discourse but the NHS, austerity and nationalisation of utilities hissed and bubbled beneath. Business leaders, along with the British people looked on nervously.

The Conservatives, ostensibly pro-business, based their campaign on carrying Brexit over the line concerning those enterprises whose models depend on Single Market access and just-in-time supply chains. Labour offered a much softer approach with the option of a second referendum, but their proposed tax hikes on high earners and nationalisation of utilities raised fears of their own.

Despite a tightening in the polls in the days leading up to the big day, it was the Conservatives who emerged victorious, a 1% increase in vote share leading to a pulverising 80-seat majority.

It would take some Olympic-grade mental gymnastics to claim that the outcome of the December 12thnational poll was anything other than the most significant event of 2019. Brexit now looks a certainty and how UK businesses are able to adapt to it won’t just define their 2020, it will define their foreseeable future.