A weaker May will be keen for company

The extraordinary drama caused by the general election result will have significant implications for business in the UK, and it is vital to understand this new environment if you wish to have an influence on what happens next.

This is a government that has lost much of its authority. Theresa May, in particular, is considered fair game, not just by the opposition, but also by her backbenchers. With the damaging U-turn on social care policy, as well as previously on national insurance and business rates, Mrs May has shown that she can be challenged and defeated. This means that almost every piece of legislation will be a battle to push through parliament.

Not only will the prime minister struggle to make progress on significant portions of her domestic policy platform, but also her objectives in the negotiations with the European Union. The Commons and the Lords will have more influence on the prime minister’s approach to Brexit.

When Mrs May arrived at Downing Street last summer there was an impression that government did not wish to hear about difficult issues raised by business. In particular, in discussions on the implications of Brexit, cabinet ministers frequently accused companies of scaremongering and seeking to protect the status quo in any given sector.

Theresa May may need to project a more business-friendly image.

Some companies therefore became risk averse in raising these difficult issues for fear of falling out of favour. The failure to secure a majority has changed this dynamic, and business leaders such as Sir Martin Sorrell and Lord (Digby) Jones have been emboldened to criticise the pre-election approach of business being held at arm’s length.

This means that companies will be in a stronger position to raise difficult topics and to change the government’s direction, including demands for a softening of its tone on Brexit. The government will be keen to engage and to minimise corporate criticisms, because Mrs May is likely to want to project a more business-friendly image and demeanour in her position of weakness.

You should be drawing up a list of issues critical to your business. Think through what are your requirements of government, be they domestic policy challenges or those related to Brexit.

The aim is to match these targeted issues with the government’s priorities and subsequent legislative programme — and to identify MPs and peers who will support your agenda. We are likely to see MPs crossing party lines to secure wins for particular regions, such as gaining approval for infrastructure projects.

Whatever the uncertainties ahead, one thing is clear. Business needs to provide the strong and stable leadership that our politicians have abjectly failed to offer in recent times.

This article first appeared in The Times of London.