Editor: Far From the City, Real People are Nicking Post-it Notes

As restructuring fund houses attempt to steal the initiative, it's not just their customers' needs they're ignoring

Ollie Smith 10 March, 2023 | 2:57PM
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Guilty pleasures

I was at an arts festival last night. In the relatively small audience, there emerged an extraordinary consensus. It turns out shoplifting is a more popular pastime than you’d think.

I’ll add some context before you panic. Simply because the audience wasn’t very big, you won’t find me making any pseudo-empirical assessments about the prevalence of middle-class shoplifting in sample groups smaller than 30. No sir. But it was interesting.

The evening’s theme was "guilty pleasures", and began with an audience-led discussion of what that actually means. Example: you might feel a little bit embarrassed about your love of ABBA. You might not have told any of your drum and bass friends that you sing to Super Trouper in the shower. But some would argue that’s not really a guilty pleasure.

In our host's view, a guilty pleasure means taking some kind of enjoyment in something widely accepted to be morally questionable.

It’s getting paid for an odd-job that you deliberately cut the corners on to complete in half the time, pocketing the proceeds regardless. It’s laughing at the kids in Junior Bake Off when their cakes fall on the floor. It’s shoplifting. Shoplifting? Shoplifting.

When a woman in the audience mentioned that last one in her reply to our host, there was more agreement than you’d think: a sort of middle-class rebelliousness used to defy the restrictions imposed by parenthood, tiredness, and ageing. Sensing an opportunity to unpack the issue, I approached her at the bar in the interval and asked her a bit more. What could prompt a person to justify nicking stuff?

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The answer is quite simple. My new-found-middle-class-shoplifting-friend-who-genuinely-works-for-a-children’s-charity-and-feels-quite-ashamed-about-her-admission-but-not-enough-to-actually-stop explained there were certain rules accompanying her practice.

She wouldn’t steal from small or medium-sized businesses. Whatever she did take basically had to come from a company listed on the stock exchange, because, in her view, they care more about their shareholders than their customers. She’d happily nick loo roll from a petrol station mini-mart. Pocketing anti-freeze from Janet and Louise’s village shop would be a no.

Secondly, whatever she took had to be petty. Inexpensive items would be better. Others in the audience later agreed. One lady, obviously in her late 60s, later told me all about the endless reams of Post-it® notes she’d stolen from her former employer. She didn't care. At this point I am noting on a note of my own that this type of behaviour could be considered a privilege of sorts: stealing because you can, rather than because you have to.

When I delved further, it turned out the first of my interviewees held shares in a sugar company. It was her only investment. Or rather: she held one share, to be precise, which had been gifted to her. Apparently her regular dividends came in the form of actual pennies, not pounds. I liked that I’d chatted to someone with such a small bit of skin in the game.

I thought about this all night. I pondered my new friend, who felt disenchanted with corporations enough to nick from them, but not so dissastisfied to sell her one casino chip.

Moreover, I thought about all the big companies who announce grand plans, restructurings, demergers, acquisitions and share buybacks, all in the name of sound financial management, profitability, and shareholder value.

When you read through their public statements at the beginning of a trading day, you instantly feel a world away from the end consumer. Investor relations is a very different world to customer relations. 

Guilty and Displeasured

This matters to savers because the companies they invest through are hardly "static" at the moment. There’s abrdn, whose corporate restructure, rebrand, and subsequent stock market wobbles has generated too much press coverage. This week M&G also found itself batting away speculation it could be bought by Australian financial giant Macquarie.

Whether the deal goes ahead, the specifics of such arrangements are inevitably described in glowing terms by those in the know. To some degree this is understandable. Shareholders need to hear convincing arguments about the next step in a business’s journey. But is anyone thinking about the customer? I know I am not the first to ask this.

People who invest with M&G have been through quite the confusing morass of upheaval in the last 10 years. At one point, following a merger with Prudential in 2017, they were customers of "M&G Prudential". Then, just two years later, the companies demerged, leaving the M&G segment listed as M&G PLC. No sane person would look at that trajectory and think it had been planned all along with the interests of five million customers centre stage.

We’re nowhere near the end of this cycle. As competition in the world of asset management, savings, and investment continues, and the popularity of passive investing continues to put price pressure on under-performing products, big companies are going to start moving their chess pieces more, not less. God forbid they also under-perform their benchmarks. Abrdn, meanwhile, could offload its private equity business.

There’s already a sense the customer’s interests have been sidelined, but if such companies aren’t careful they’ll lose trust altogether. There’s only so long the game of musical chairs can go on before someone doesn’t have a chair to sit on. When that customer loses out, they’ll go and sit somewhere else.

I'll end with this. I'm sure we'd all quietly admit to having guilty pleasures (proper ones, mind, not the ABBA variety). But I was a bit taken aback to discover how open some people were about theirs. There's a humanity to it, regardless of the morals. That's real life I guess. That's also real people and real customers. Whatever customers' needs (or proclivities), savings companies forget that at their peril. The real thief is complacency.

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Ollie Smith

Ollie Smith  is editor of Morningstar UK

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