Breaking Down Brexit: Brexit’s Impact on Communications
In June 2016, a public vote was held in the United Kingdom on whether it should exit the European Union.
Today, nearly three years after the referendum, which saw 51.9% vote to leave the EU, the deal remains up in the air. The UK’s departure was due to take place on March 29, 2019 – but that date has since been extended. Twice.
Whilst there has been little agreement or clarity regarding the UK’s withdrawal over the past three years, one thing has remained consistent: uncertainty. Uncertainty about when the country will secede, uncertainty about how it will do so, uncertainty about what the deal will look like, uncertainty about what it will mean for the economy, for the exchange rate, for import taxes, export taxes, the cost of goods, the housing market, traveling outside of the UK, traveling into the UK, etc..
As communications professionals, how does this affect guiding our clients?
Any clients, or indeed businesses in general, with operations or investments in the UK have been caught in something of a holding pattern while the complexities of Brexit remain unresolved. While many financial services firms have been preparing for the ‘no-deal’ scenario, for now, many are waiting to see how politicians negotiate the country’s exit from the European Union before taking any further action.
Some clients have been outspoken about their views on Brexit – whether they support it or not, how it is influencing their business decisions, how they expect it to conclude and what the impact will be. However, these are relatively few and far between, with the majority of executives choosing to avoid commenting on it too publicly, especially when the outcome is so unclear. The media is clamoring for sources who are willing to speak on the subject, so if you have a client who is confident sharing their view or giving guidance to help explain the mechanics behind the process, then this is certainly something to consider. However, a word of warning. Brexit is such a divisive subject that they may well receive some mixed responses!
Many clients are considering relocating at least some functions to Europe – indeed, EY’s Financial Services Brexit Tracker estimated that in January 2019 36% of the UK’s largest financial services firms had already confirmed that they will do so. While some clients have already announced the launch of new operations outside of the UK, we can expect that others will follow suit in the coming months.
So, what can we do for our clients?
When publicising these announcements, our advice would be to keep all communications as factual as possible, emphasizing the logistical reasons why such decisions have been made and ensuring that it does not appear to be reflective of executive(s) personal opinions. This has been the approach followed by multi-national corporations including Aviva, Bank of America Merrill Lynch, Barclays, Credit Suisse, Goldman Sachs, HSBC, JP Morgan Chase, Lloyds of London and UBS. It’s worth noting that even the blandest statements will likely be supplemented with reporter’s commentary about the expected damage that Brexit will reap on the London finance scene and Britain’s economy in general.
There are a number of important dates coming up in the next few months, which we’ve outlined below. The outcome of each of these could have a tangible impact on the direction that Brexit takes, so it is worth taking them into account when preparing any client communication around the subject:
- MAY 24: European Parliament elections – whereby British MEPs could be elected to a five-year EU Parliament term, two months after Britain was meant to leave the EU. If the UK does not take part in these elections, it will leave the EU with no deal.
- JUNE 20: The EU and the UK will review progress on Brexit; if a decision has been reached, this could trigger a departure date earlier than October 31.
- JULY 2: European Parliament session begins. MEPs from the UK will not attend the parliament if there is a deal before this date.
- SEPTEMBER 29: Conservative Party conference, where Theresa May will likely face a hoard of angry party members if no deal is agreed by this point.
- OCTOBER 31: Halloween. And the New Brexit date. After two delays, this has been set as the new ‘hard date’ of Brexit.
- DECEMBER 12: The earliest Tories can force another leadership contest against Theresa May, because legally, they have to wait a year between each one.