A new Prime Minister is not enough to fix Britain's problems

It suffers from a shortage of listeners.

As the by-election approaches, the debate is focusing on who would make the best leader. That’s understandable. Elections matter. Leadership matters. But elections encourage the belief that challenges can be solved simply by replacing one leader with another. I do not believe this is true.

After more than 50 years in business, and the last 30 trying to understand why institutions struggle to solve difficult problems and make good decisions, I have developed strong views about what makes organisations work.

If Britain were an organisation, I would not say it has a leadership crisis. I would say it has a governance crisis. Its decision-making does not encourage listening, it rewards certainty over challenge and it does not properly reflect the interests of all stakeholders.

I learned the consequences of failing to listen to stakeholders the hard way. In 2007, I led the acquisition of EMI. The investment became a very public failure.

Many assumed that my mistake had been analytical - a misunderstanding of the music industry. But the thesis behind the investment was right. I believed music would move from physical distribution to digital consumption. There would be fewer major stars, but the biggest of them would become global brands. That is largely what happened.

The problem was that many of the people whose cooperation was essential for the transition to succeed had little incentive to embrace the required changes. Across EMI, many senior stakeholders continued to defend a world built around CDs, while to me, the decline of the CD was obvious.

By the time reality was finally accepted, it was too late for EMI and too late for me. I had not misread the future. I had underestimated how little senior figures would listen to new ideas that challenged their assumptions.

I spent much of the next decade searching for a way to use my resources to drive positive change. That led me to establish Engage Britain, designed to give the public a greater voice in shaping policy.

We brought together people from different backgrounds and political perspectives to discuss some of Britain’s biggest challenges - health, social care and education. The aim was to listen. To understand what people thought about policy not through a Westminster lens, but through the realities of life. We believed that people were far more likely to support change if they were part of shaping it.

Engage Britain was an attempt to find a better way of making decisions. Yet despite considerable effort and financial investment, it never achieved the wider impact I wanted. I found myself confronting the same reality again. Too many people were more comfortable persuading others that they were right than listening to opinions that challenged their own.

Of course, leadership matters. Good leaders set direction and shape culture. But leadership is not simply about persuading people to follow. At its best, it is about representing people, giving them a voice and uniting individuals who may disagree around a shared vision.

Solely changing leaders rarely changes culture.

A different party leader or Prime Minister will not by itself solve Britain’s problems. Too much of politics is built on the assumption that disagreement must lead to division: one winner, many losers. Opponents are portrayed as enemies. Differences of opinion are treated as evidence of ignorance. Listening is mistaken for weakness. Changing one’s mind is seen as surrender.

Yet most of us want something very different from our leaders. We want to be heard. We want our concerns taken seriously.

We want leaders who can bring people together, not drive them further apart.

The most successful societies and organisations are those that create cultures where people feel safe enough to challenge assumptions, including their own.

If Britain is to become a more cohesive and successful country, we must encourage that spirit. We need institutions that listen more and lecture less. Leaders who acknowledge uncertainty. People who can disagree without assuming the worst of one another.

Real leadership isn’t about having all the answers. It’s about creating environments where the best answers can emerge. This requires humility and a willingness to listen.

Solving Britain’s biggest challenges will not come when one political tribe defeats another. It will come when we rediscover the difference between debate and damnation.

My experience at EMI taught me that being right about the future is not enough. Engage Britain taught me that giving people a voice is not enough. Unless our institutions learn to listen, neither better ideas nor better leaders will produce better outcomes. Britain’s challenge is not simply political. It is human. And it can only be solved when people feel heard.

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Guy Hands is the Founder of private equity firm Terra Firma.

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