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In reference to Martin Wolf’s column “The strange death of corporate Britain” (Opinion, October 16), we the undersigned (writing solely in our individual capacities from a wide array of industrial, asset management and economic disciplines) share a common feeling of dismay regarding the structural liquidation of the UK corporate sector.
This is graphically illustrated in the analysis Wolf refers to, undertaken by Ondra Partners.
We are particularly concerned about the challenge of building and maintaining our competitiveness from the base of a domestic equity market that no longer offers either depth of access to new primary capital, trading liquidity or valuations in line with international peers.
Partial measures or tinkering with the existing pension savings system are clearly insufficient, especially given how far advanced are the consequences of the depleted supply of extended time horizon risk capital.
There is no solution in our view that does not entail, one way or the other, a wholesale replenishment of the pool of domestic equity capital, which in turn can only be achieved through the creation of a constellation of existing and new long-term pension savings funds that have the proven ingredients of scale, time horizon and professionally managed diversification that no longer exist in the UK.
Given the urgency, there is every reason and advantage to kick-start the rebuilding process by scaling an existing, established and fit-for-purpose institution, namely the Pension Protection Fund, with its proven consolidation and return-generating capabilities. The PPF can in turn then serve as a model and template for replication with this country’s other deep capital pools.
We can then all do our part to fulfil the UK’s uncommonly good long-term promise and potential and, in this way — by refilling the reservoir of domestic equity capital in line with that enjoyed by our peers — the UK corporate sector will once again be able to unlock and do justice to this country’s creative energy, human talent and entrepreneurial spirit.
Sir John Bell
Regius Professor of Medicine, University of Oxford; Chairman, Immunocore
Dominic Barton
Chair, Rio Tinto; Former Global Head, McKinsey & Co
Richard Buxton
Senior Fund Manager (retired)
Sir Mick Davis
Founder, Xstrata; Former Conservative Party Treasurer
Ian Davis
Former Chair, Rolls-Royce; Former Worldwide Head, McKinsey & Co
Michael Tory
Co-founder, Ondra Partners
Andy Griffiths
Executive Director, Investor Forum
Hermann Hauser
Founder, Arm Holdings; Founder, Amadeus Capital
John Kay
Leading British Economist; Adviser to companies and governments globally
Gerry Murphy
Chairman, Tesco and Burberry; former Chair, Blackstone Europe, Invest Europe
Duncan Tatton-Brown
Chair, Oxford Nanopore Technologies
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