Honesty is always the best policy

Feb 2 2010 by Neil Warwick, The Journal

FOLLOWING on from the somewhat glutinous years of the boom times, businesses have had to take more responsibility for the way in which they are run.

The flurry of recent activity in the Press this weekend has highlighted some interesting cases which indirectly link to changes in business behaviours coming out of the recession.

The overturning of a so-called super injunction this weekend saw the rebalance of privacy laws built on the back of human rights laws with the case of a famous footballer.

Before this judgement privacy laws were in danger of becoming dependent on the financial clout of the individuals involved. Whether you believe that celebrities should be named and shamed or not, it is important that the law is applied fairly and even-handedly.

Equally, in this age of freedom of speech, newspapers shouldn’t fear publishing stories because of the risk of a law suit.

In a similar way to this case and also the ongoing Chilcot inquiry, coming out of the recession, we should see a lot more honesty and a lot less spin in the UK plc too.

Prior to the collapse of Lehman Brothers we had witnessed a decade, perhaps even longer in the North East, of unprecedented growth. We are also aware that a lot of this growth was predicated on over-inflated debt and we now need to pay for this essentially with a bit of good old fashioned belt-tightening.

With the recession acting as a catalyst, we should hopefully see a new level of honesty in business dealings more generally. Companies wishing to come out of the recession with a strong business will have to commit to more honest and open communication in order to maintain their reputation.

Speaking of reputation, basic public relations ‘own goals’ will also have to be avoided. To take one example, if your business is about to launch a redundancy consultation, it would be advisable not to advertise several senior posts in a national broadsheet a few days later. While there may be perfect logic for this sort of thing, it will not play well with customers and particularly not with those affected by the redundancy consultations.

As a result of the recession, there will be a drive for best practice in businesses in the region with greater amount of transparency and commitment to open communication anticipated which will ultimately lead to a more honest business culture for the future.

For legal advice about issues that affect SMEs, contact Neil Warwick, partner at Newcastle-based law firm Dickinson Dees on 0191 279 9375