‘Brexit and the Implications for Board Composition’ Fidelio Breakfast with Sir Simon Fraser, former Permanent Under-Secretary FCO, 11 October 2016

October 2016 Table Talk


Brexit creates enormous complexity for Boards of UK companies and companies operating in or trading with the UK. As a Board Development and Executive Search firm, Fidelio has a keen focus on the skills that are needed at Board-level to navigate the very significant uncertainty ahead.

To help us explore this topic we were delighted to welcome Sir Simon Fraser to speak at a Fidelio Board breakfast on “Brexit and the Implications for Board Composition”. Simon is Managing Partner of the European business advisory firm Flint Global, and was permanent under-secretary at the Foreign and Commonwealth Office (FCO) and Head of the UK Diplomatic Service from 2010 to 2015.  Previously he was permanent secretary at the UK Department for Business, Innovation and Skills and also served as director general for Europe and Globalization in the FCO and as chief of staff to European trade commissioner Peter Mandelson. Simon brings deep insight into the challenges that lie ahead, as well as the skills and experience that will be needed in the Board room.

Specifically we asked Simon to address three topics:

We were joined by Chairs and Non-Executive and Executive Directors from a variety of sectors including Financial Services, shipping, aviation and major trade bodies. Additionally, a range of geographies including Japan, Canada, Germany and Italy were represented.

The key themes are summarised below:

Brexit and the Facts for Boards

Simon Fraser began by providing background and shedding light on the Brexit positioning at the Conservative Party Conference. He highlighted the extent to which we are at the beginning of a long road, and while a harder Brexit may be on the cards, Article 50 is simply the first step. It will be Article 218 that forms the basis for negotiating the terms of Brexit, and that will determine the future of the relationship between the UK and the EU.

Boards clearly cannot wait for clarity and according to Simon and Directors around Fidelio’s breakfast table, companies are currently adopting a dual approach of (i) finding out as much as possible, and (ii) developing rigorous multi-option scenario planning:

Boards are juggling oversight of the following:

 Boards, Engagement and the Political Process

The Referendum result demonstrated the degree to which business had failed to connect with the broader public, and anticipate popular sentiment, as well as the extent to which in many cases, while Boards had contingency plans in place, they were psychologically unprepared for Brexit.

Two key themes emerged from Fidelio’s breakfast discussion:

Biggest Challenge – Access to Talent

In certain quarters Brexit is increasingly being seen as a revolution. And certainly the rise in anti-immigration sentiment, as well as the backlash against freedom of movement has resulted in international employees working in the UK feeling profoundly unsettled.

The challenge that has moved to the top of the agenda for business leaders is

There are clearly sector specifics here. For UK Financial Services securing “passporting” rights is a priority. For technology companies, including FinTech where the UK currently retains a global advantage, the ability to attract the best programmers but also investors is considered to be an existential challenge.

Fidelio confirmed that we are seeing access to talent become a key agenda item across a range of industries and services operating in the UK. But there is opportunity as well as threat and Fidelio currently sees that employers with a clear proposition and long-term commitment are still able to attract highly qualified international expertise.

Diversity and Flexibility

Arguably lack of diversity around the top table was a contributing factor in Brexit. It certainly meant that many of those in decision making roles both in business and politics were not hearing, or under-estimating, voices of a different persuasion.

If Boards are to have a hope of navigating the complexity ahead, they need to view challenges from different perspectives. Gender diversity must remain on the agenda; but beyond this Chairmen must be sure the Board is capable of hearing and interpreting what key stakeholder groups are thinking, including customer, public and political opinion. Drawing upon too narrow a talent pool will create a major handicap for Boards and companies which must explore multiple and options and strategies in order to survive.

But there is also the licence to operate dimension. The UK Government – to the great surprise of business – appears to be championing employee representation on UK Boards.  Given Fidelio’s origins, we have substantial experience of Germany’s two tier Board system with its Supervisory Board representation for employees. It’s a system of governance that reflects German ownership models and German industrial policy and there are significant challenges in translating this concept “like-for-like” to work for UK Boards. Fidelio will pick this theme up at our next Board breakfast to be held in early December.


Sir Simon Fraser and Fidelio’s guests did not underestimate the significant challenges facing UK business, and the long road ahead. All parties around the table were aligned in a long-term objective of achieving a favourable trading environment for the UK. All parties were also very respectful of the importance of the EU in reaching this goal and the need for a collaborative rather than hostile approach. Several did comment, however, that as Board Directors they also had a clear commitment to shareholders to weatherproof the company and that could well entail moving jobs from the UK or making provision to do so.

There are no simple answers to the implications for Board composition. It is clear, however, that successful Boards will be those which are:

Indeed, Brexit is clearly a pivotal point for Boards in terms of committing to building up a strong corporate culture; inviting international perspectives and new skills into the Boardroom; and refreshing the business’s strategic communications. As such, Brexit can represent a powerful opportunity for business. This requires fresh thinking. It is important to bear in mind that business opportunities will arise from Brexit, and in order to maximise on this Boards need to remain realistic but positive about the future.  Sir Simon concluded with Foreign Office wisdom – failure to anticipate the totally unexpected is frequently not due lack of intelligence or knowledge. The failure of imagination can represent the much bigger risk. And we would concur that Boards sorely need to ensure they are not lacking imagination at this extraordinary and unprecedented time for UK business.







About Fidelio


As a Board Development and Executive Search firm Fidelio works internationally to build highly effective Boards and leadership teams capable of handling change and complexity. Fidelio achieves through Evaluation, Development and Search.  Moreover clients benefit from Fidelio’s world class Search expertise in roles that are critical for shareholders and stakeholders. Fidelio also has a track record in working cross-border, cross-sector and cross-function. The Fidelio universe spans corporates, financial institutions, investors and consultants. We are forward-looking and proactively embrace diversity to address the challenges businesses face. For further information on how we can support your company through Search, Development or Evaluation, or of Fidelio’s Seat at the Table Programme for senior female executives and directors please contact Gillian Karran-Cumberlege, or alternatively call + 44 (0) 20 7759 2200.

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