The widespread upheaval in financial services regulation and policymaking across the UK, Europe and the US is all great news for Cicero Consulting director and chief corporate counsel Iain Anderson. He says his lobbying firm has never been so busy in aiding banks, life offices, asset managers and intermediaries through the new political landscape.
He says: “This UK Government isn’t the so-called Brokeback coalition, this is the breakneck coalition. It is an interesting time because ministers are excited and full of beans, like things should be. The political debates about the affordability of health and pensions – things financial intermediaries provide – are much more mature now and offer a lot of opportunity.”
Anderson believes now is the time to take advantage of the opportunity to shape reform before the new Government’s enthusiasm wanes. “It can’t last forever, so the chance to influence the outcomes of policy is now.”
With the growing pace of regulatory change, Cicero opened an office in Brussels last year and next month is due to open an office in Washington.
Anderson, who has been rated one of the top 25 most influential lobbyists in the UK, started his career as a journalist. After a brief stint working for regional papers, he joined Money Marketing. After covering mortgages and politics, he moved on to help launch Investment Week. The company floated and helped Anderson turn a small inheritance he had invested into a “significant amount”.
He decided to move into government relations and lobbying with Ludgate. “I had been writing about Scottish Amicable’s possible sale to Prudential. I then flipped over and one week later I ended up advising Scottish Amicable on how to manage the sale.”
He left Ludgate with the “tools of the lobbying trade” and, using the money he had made from the flotation, helped to set up Cicero Consulting.
Anderson says one of the biggest challenges for the new firm was dealing with New Labour. “You had a Government that was very happy to communicate with the financial services sector but it was not a dialogue, it was more of a set of demands.”
The biggest challenge for Cicero came with the credit crunch in 2007. Anderson saw his mortgage clients leave initially and more firms followed as the need for survival overtook the need to lobby. By the end of 2008, Anderson says the “phones just stopped” but almost as soon as the FTSE came off its bottom in 2009, firms began seeking out advice on how to navigate the new world.
“Ever since then, month by month, the business has had a growing set of revenues as the huge debate on the future of global financial services regulation continues.”
Anderson says he became even busier at the back end of 2009 as more clients realised they had to begin influencing the Conservatives as well as Labour.
He says that despite predictions the coalition Government will break up under the conflicting demands of the two parties, it is strong enough to last. “At the very top, the mood music is superb. When you get away from the very top, then there are tensions but I think the coalition has a very good chance of lasting the course.”
Anderson says IFAs will need to adjust to a more intrusive regulator which will be brought about by reform to the FSA. But he warns that the biggest threat to financial services will come from regulatory changes in the US and Europe.
“The changes in the US are massive. What we are looking out for now is the danger of an arms race in terms of regulation. Capitol Hill has done its thing now and you can see the potential for Brussels to try and up that so there is a fear that US and EU political overkill may mean we get more regulation than we need. Debates and policies are now emerging and, if it is not right, it could end up with highly restrictive regulation in the UK industry.
“IFAs should be more concerned with what is happening in Washington and, more important, Brussels than with what is happening in the UK in terms of regulatory reform.”
He says the intermediary sector must rid itself of its “little Britain” outlook and look at the bigger picture. “The debate becomes so micro around the impact of distribution on intermediaries that they are not thinking about the impact on the product base. The financial services industry has too many disparate voices and everyone is playing for either product or distribution advantage, something we see every week in Money Marketing. But these debates are going to have no traction with Government – a lobby needs consistency of opinion and the financial services sector needs to get better at that.”
One immediate area where IFAs can get more active is in the implementation of the RDR, he says. Anderson says there is no doubt the RDR will go ahead but the passage of the current regulatory reforms through Parliament means intermediaries have plenty of time to have their say.
“It is important that intermediaries retain a distinctive voice but they need to coalesce and co-align much more in order to ram the point across. They also need to build a bigger evidence base by moving away from special pleading to evidencing their arguments so as to prove what they want to see will positively affect the economy. Right now, UK ministers are mainly focused on how we can get growth and where it is coming from.”
Anderson says if IFAs can frame their argument right in influencing how distribution, regulation and product development is changed over the coming years around the world, there are many opportunities to build the sector.
“That is a huge opportunity for the sector and they can be part of the debate in as much as how pensions are distributed and on the future of long-term care or even on Ucits, the review of Mifid, Solvency II or a pan-European regulator. But to do this, intermediaries must stop moaning and get stuck into the debate.”
Born: Aberdeen, 1968
Lives: Notting Hill, London and Nice, France
Education: Economics and Politics, MA St Andrews University; Postgraduate journalism, University of Wales, College of Cardiff
Career: 2000 to present: founder, director and chief corporate counsel, Cicero Consulting; 1997-2000: director, Ludgate Public Affairs; 1994-97: launch team, Investment Week; 1992-94: reporter, Money Marketing; 1991-92: postgraduate degree, including work on The Herald, Glasgow; 1990: The Courier, Dundee
Politics: 2010 to present: chairman, CIPR Government Affairs Group; 2001 and 2005: Tory Leadership Campaign Team for Kenneth Clarke MP; 1988-90: part-time as MP’s researcher
Likes: Jazz, opera, travelling and can-do people
Dislikes: Negative, glass-ishalf-empty people
Drives: Jeep Grand Cherokee
Book: Currently reading The Third Man by Peter Mandelson.
Favourite book: The Catcher
in the Rye by JD Salinger
Film: All The President’s Men
Album: The Pursuit by Jamie Cullum
Career ambition: To continue to expand my business globally
Life ambition: To always be at the heart of the debate
If I wasn’t doing this I would be…Perhaps an MP or a winemaker in Burgundy