Theresa May made her final appearance in front of the UK’s business leaders on a warm evening in Downing Street, delivering a plea for unity between the government and corporate Britain.
But the drinks reception last week marked an all too rare engagement by Mrs May with the business community, a fact not lost on many attendees who reflected on the cold reception from the prime minister when she first entered Number 10.
Mrs May used her speech to call on her successor, Boris Johnson or Jeremy Hunt, to take a firmly pro-business stance after Brexit.
Business leaders worry they will be swapping a prime minister belatedly swinging behind them for another willing to oversee a no-deal Brexit, no matter the fallout for jobs and industry.
“Businesses are worried about the rhetoric coming out of Boris and Jeremy,” said one government official who attended the drinks reception. “They don’t see either as anti-business especially, but the view is that a no-deal Brexit is now a much higher risk.”
Mrs May, who steps down as prime minister this month, leaves a business legacy mostly defined by her failure to secure parliamentary approval for her Brexit deal with the EU.
When told about this article examining Mrs May’s record on business, one FTSE boss quipped: “That’ll be short.” Another replied: “A paragraph long maybe.”
But other executives were quick to defend Mrs May’s recent initiatives to support business.
She had arrived in Number 10 in July 2016 determined to take on big business, giving speeches attacking high executive pay and proposing an overhaul of corporate governance that would put workers on boards. She also cancelled the business advisory group established by her predecessor David Cameron.
One Downing Street insider said: “It wasn’t the same sort of chummy relationship with Cameron. Business was not made to feel welcome.”
Business leaders were in despair — the Conservative party was supposed to be the ally of wealth creators, but Mrs May drew thick red lines on a hard Brexit that risked significant economic damage.
Many of Mrs May’s plans were watered down after resistance from chancellor Philip Hammond. When her co-chief of staff Nick Timothy quit after the Tories lost their parliamentary majority at the disastrous 2017 general election, Mrs May’s early agenda was mostly jettisoned.
But a cabinet meeting at Chequers in July 2018 proved the turning point for the prime minister’s relationship with business.
In the run-up, companies were unusually vocal in warning of the dangers of a no-deal Brexit.
At the cabinet meeting, Mrs May outlined plans for a free trade area for goods involving the UK and the EU that would continue with existing regulatory and customs arrangements. One official pointed to Downing Street’s realisation that frictionless trade with the EU was crucial to the British economy.
Mr Johnson, a leading Eurosceptic, quit as foreign secretary in protest at the soft Brexit plans, but they won the backing of business.
Mrs May thereafter abandoned her arm’s-length relationship with executives, and set up five business advisory councils. By February, amid her struggles to obtain MPs’ approval for her Brexit deal, she was holding a conference call with 280 business leaders to try to keep them on side.
“It was difficult to engage with the prime minister at first,” said Stephen Phipson, head of Make UK, the trade body for the manufacturing industry. “But there has been a massive increase in business engagement since last summer.”
Some of Mrs May’s corporate critics are now more positive, saying she will leave behind a network of effective business councils that have produced policy recommendations which her successor would be foolish to dismantle.
Work by civil servants on some of the recommendations is already in train, such as plans for a state-sponsored technology hub and a commitment to reduce visa processing times.
Sir Roger Carr, chair of BAE Systems and co-head of the industrial business council, said Mrs May had remained “committed and engaged” in spite of competing priorities.
“The PM insisted that it must be a positive, practical and focused exercise and our belief is that both the results and political mindset should last beyond her period of office,” he added.
Brent Hoberman, chair of Founders Forum, who sits on the business council for entrepreneurs, said there was no certainty that Mrs May’s network with executives would continue but it would be “sensible to let them finish the job”.
“She clearly won a lot of goodwill with the councils,” he said. “They were able to get to some good initiatives in a compressed timeframe.”
Most executives agreed that Mrs May is not leaving a major business legacy, however.
The prime minister set up a new merger regime last year that will ensure tougher scrutiny on foreign takeovers of UK companies.
She can also point to the launch in 2017 of the government’s industrial strategy, but much will depend on whether her successor decides to implement proposals in the 255-page document.
Emma Jones, founder of Enterprise Nation, and who also sits on one of Mrs May’s business councils, admits the prime minister has not been a champion for entrepreneurship given her Brexit focus. The next candidate has a chance to change this, she said. “I would like to see a celebration of entrepreneurship return to the rooms and corridors of No 10.”
But if Mrs May’s attempts at business reform were hamstrung by how much of her energy was expended on Brexit, that is unlikely to change for the next occupant of Downing Street.
“It is obvious that the government has been distracted by Brexit for some time, and especially Theresa May,” said one FTSE 100 chair. “The key thing is what the next PM wants to do with Brexit.”
