Scapegoat syndrome starts to catch on in the business world

George Pitcher is joint managing director of media consultancy Luther Pendragon

I was intrigued at the weekend by the circumstances surrounding demands for two senior figures to leave their posts. It seemed that they were being summarily dumped by superiors who saw no cause to carry the can themselves.

No, I don’t mean William Waldegrave and Sir Nicholas Lyell, though I believe the political climate does have a relevance, as I hope to show. Actually, I refer to the sackings of Tate & Lyle’s marketing manager, Bob Laird, and Bell Cable Media’s construction director, Michael Simmons, both of whose former employers are now suing them for alleged fraud.

Now, before the bewigged ladies and gentlemen at inns of court grow over-excited, let me make it clear that I have not the slightest knowledge of, nor interest in, the veracity of the civil (not criminal) charges being brought by Tate and Bell.

My sole intention is to examine how these legal actions reflect on the companies’ respective attitudes to corporate accountability. It is, necessary to discuss what Tate and Bell allege that their former employees have done.

In the case of Laird, sugar group Tate & Lyle is claiming, through its solicitors Mishcon de Reya, that its former marketing manager authorised some 60 invoices for fictitious work over a two-year period.

It is suing him and four suppliers – Gordon Proctor of Gordon Proctor Consultancy, Joe McHugh of Design Consultants, Alan Radnor of P&Q Communications and Penny White of P White Design – for damages, fraudulent misrepresentation, deceit and repayment of precisely 385,376. Laird is the marketer responsible for the Tate’s current 4m advertising campaign, but the legal action is entirely unrelated, we are told, to the ad agency responsible – WCRS.

Simmons faces similar litigation for the recovery of undisclosed sums that Bell claims he defrauded from the company. As construction director, Simmons would have been ultimately responsible for the laying of cable. It has to be said that cable-laying in the UK has been disastrous in some aspects of its marketing. Anecdotal evidence suggests that cable companies have taken little or no account of the consumer resentment that they generate by digging up residential streets.

That said, Bell clearly has a rather stronger gripe against Simmons than a failure in the public relations department. Bob Somers, the Canadian who has just taken over as Bell’s chief executive from Alan Bates, does not issue writs, as far as I know, for bad PR. There are more serious allegations here.

But, as I say, I have no desire to explore the detail of the allegations against Simmons and Laird. Rather, I want to consider the implications of companies such as Tate and Bell launching civil actions for recovery of funds from former employees at the sharp end of business management. A couple of swallows don’t make a summer and a pair of sackings don’t constitute a trend, but I wonder whether we should nonetheless beware of a scapegoat syndrome creeping into the business environment from the political world.

In the political arena, it is all too familiar – former chancellors Nigel Lawson and Norman Lamont were forced to take the rap to protect Margaret Thatcher and John Major respectively. Doubtless, Waldegrave and Lyell would have to do the same if the Scott Report got too close to home.

Such political “disciplines” may prove transferable to business life. It may be co-incidental that on the board of Bell is former Home Secretary and Tory party chairman Kenneth Baker, alongside loyal Government supporter Sir David English, chairman of Associated Newspapers. Or it may not be – these are people more used to the style of politics than business.

Nor, it would appear, is business life above the political-style smear. It is now being band-ed about that Laird, in a pastiche of Desert Island Discs, asked in an item in trade magazine Marketing, for a double bed with 19-year-old native girls and a William Hill credit card. So what?

We have been here before, of course. Rogue Trader is published this week, an apologia by Nick Leeson, the nemesis of merchant bank Barings. Leeson comes over as thoroughly unpleasant – he thinks nothing, for example, of nicking a set of cutlery for a new flat from a local Indian restaurant.

It is nevertheless a testament to how those at the top like a flat management structure when there’s credit to be had, but prefer a line management structure when there’s blame to delegate. I emphasise that I have no idea of the grounds of the cases that Tate and Bell have against their former employees.

But it would be a shame if in a political climate, where no one at the top seems to accept any blame for anything, if business were tempted to adopt a similar approach.

People at the sharper end of business practice will, from time to time, be fired. That is a fact of business life. But we should be vigilant lest it becomes too convenient for companies to assume that they can behave like political parties and never accept responsibility at the top. These attitudes can prove all too catching.

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