Surrounding himself with 'yes' men was Philip Green’s undoing

We live in an age where reputation is all, and it’s extremely fragile

Towards the end of Oliver Shah’s Damaged Goods: the Inside Story of Sir Philip Green, the Collapse of BHS and the Death of the High Street, a mirror is held up to the entire professional advisory class.

It concerns the reason why Green refused to put money into an escrow account to cover the pension deficit on BHS, the store chain he’d previously sold for a pound. Having ignored the hole, and offloaded BHS to a buyer wholly unsuited to running the company, and incurring widespread opprobrium, Green had a chance to recover the situation.

Instead, he blew it, choosing to not pay, and attracting headlines such as “Sir Shifty”. Eventually, he paid, but under protest, by which time the damage was done.

As Shah makes clear, Green’s friends were utterly perplexed by his behaviour. Jeff Randall, the former senior business journalist, tried to broker peace with Frank Field, chair of the Commons select committee looking into the affair. His efforts came to nought, as Green refused to acknowledge any liability towards the pensioners. Randall said it was “like watching a child put its hand in the fire”.

To reinforce his position, Green commissioned a 79-page legal opinion from four barristers dismissing the select committee’s inquiry as “unfair”. Eventually, after MPs threatened to strip him of his knighthood, Green paid £363m to the pensions regulator.

It had taken nine months, during which time his image was shredded. Why? What appeared to have happened, concludes Shah, is that Green, having been surrounded by “yes” men for so long, had lost all perspective.

There’s every truth in this. We live in an age where reputation is all, and it’s extremely fragile. Instant communication means we can form a view that no amount of expert, often expensive, advice can dislodge.

It’s something that most public relations advisers, lawyers and accountants have failed to adapt to. You, the client, have this objective in mind. Consider it done. We can structure your affairs or launch a lawsuit that will achieve your desired ambition or explain what you’re doing to the media. No matter, the great harm this may be do to you, reputation-wise, as a result.

Take another example, coincidentally also involving Green (I’ve just read Shah’s book). The retail tycoon moved his wife and children to Monaco, and put the businesses in his wife’s name. He commuted backwards and forwards by private jet, staying in the Dorchester hotel in London. That way he kept his tax bill from his UK shopping empire to a minimum.

Henceforward, while he was financially better off, articles and references to him frequently cited that he resided in a tax haven. That would be fine, except the sniping drove him mad. He would phone up, ranting that where he chose to live was irrelevant. He would claim that he and his family were based in Monaco because they liked it there, that tax was not the major criterion but rather it was actually a splendid place to live, with an ideal climate.

Green had a form of words off pat, maintaining that his wife headed an international family investment business that invested in a UK stores group. In that sense, he would insist, the Green family was no different from any other global financial investment concern that had its ownership overseas.

He would produce a letter from the head of the Inland Revenue, saying that the tax authority was satisfied that Green paid all the taxes he was obliged to pay in the United Kingdom. No one doubted he did, but that was not the point: had Green not based his wife in Monaco, and had she not been made the owner of the businesses, he would have been liable to pay much more.

No doubt Green enjoyed the extra cash his convoluted lifestyle brought. But, judging from his anger at the criticism he provoked, I do wonder if it was worth it.

Green is not alone. Others also go to great lengths to avoid paying tax. However, compared to the number of those who can afford to do so, who can afford a private jet, they’re not so many. Did Green ever stop and think, and ask why other fellow members of the super-rich did not do the same? Perhaps some simply could not be bothered with the complex arrangement, but there will be some who also took a view that to go to such lengths would not be good PR – and that would outweigh whatever sum they would save. In which case, did Green’s legion of advisers ever suggest he think twice, that his reputation would be heavily tarnished from the move? Fair enough, he may not have listened, but the suspicion has to be that no one seriously challenged him.

Take lawyers. The number of occasions where a solicitor recommends there is an action worth pursuing, when in fact the injury done in terms of causing lasting damage to relations with the other side, and the negative publicity the suit will provoke, should stop a suit there and then. How often does it, though?

If a public body takes a decision against an organisation or wealthy individual there is frequently a tendency to immediately consider applying for judicial review. Then, someone should point out that even if they’re granted judicial review, the likelihood of success, involving a judge ruling against the government, is slim. In the meantime, they risk alienating the public servants concerned, and they cannot get any business done with the government branch concerned because they’re now in litigation with them, and in regard to their image they’ve somehow got to not make it look as though they’re suing just because they lost and they can afford to resort to the courts. Sometimes then, they reconsider.

Sadly, where powerful, wealthy clients are concerned, as Green and BHS highlight, too many advisers aim to please, not help.

Chris Blackhurst is a former editor of The Independent, and a director of C|T|F Partners, the campaigns and strategic communications advisory firm