There is a new crisis brewing in the wake of the pandemic and it concerns our modified behaviours.  In shaping a more digital future, assumptions around supply and demand are creating inequalities.  For example, bank branches are closing ‘en-masse’ as customers have moved away from using cash and high streets are emptying as energy costs go up and retail moves online.

Uneven power structures are part of the problem – the Swiss National Bank is facing calls for an overhaul in its governance, with critics saying too much power lies in the hands of its chairman and that more transparency is needed.

In particular, the closure of bank branches and ATMs are causing concern as the implications do not fall equally across all of society. Evidence shows that older people, those on lower incomes and people with certain physical and mental health problems are disproportionately affected. Similarly, for rural and isolated communities, loss of access to facilities can be debilitating.

This isn’t the first time that public conveniences have withered away unchallenged.  British Telecom has spent the past few years decommissioning many of their payphones (most of which were no longer being used, largely due to improvements in mobile phone coverage and related service affordability).   Despite this, some payphones still exist in areas where they are considered  essential and fall under Ofcom’s Telephony Universal Service Obligation (TUSO).   Yet, at the start of 2022, the TUSO was strengthened to include areas with “poor mobile signals or high accident rates”.

The reason this can happen is, unlike the public sector, there are no “duties to consult” in the private sector.  Thankfully, regulators are now stepping-in to make sure there are adequate consumer protections.  This signals a shift from their default position of safety in a highly protectionist industry, awash with citizen-unfriendly jargon and terminology.

The shift can be traced back as far as 2016 when the RSA embarked on an excellent piece of thinking around the citizen economy ; I even pitched in with an idea about mandatory public consultation for large government spending decisions.

More recently, the Financial Conduct Authority (FCA) published newly updated guidance on the closure of branches and ATMs (FG 22/6), which imposes new requirements to engage with consumers and other stakeholders in deciding when to close or otherwise alter services.

And despite what’s happening on the ground, central banks are attempting to consult more.  They have swathes of important changes ahead of them such as the introduction of digital currencies.  Some banks are better than others at citizen engagement but very few seem to have institutionalised the practice.

We think that a lack of consultation and engagement around service change is a missed opportunity for the private sector.  A robust consultation process can also help prevent public image issues. P&O Ferries’ sacking of 800 members of staff in March 2020 is the most prominent and recent private-sector example of how damaging a poor or non-existent consultation process can be. In this case, the company defied employment law by failing to consult the sacked staff. The decision caused public protests, parliamentary and legal scrutiny and intense criticism and reputational damage to the company. Had they properly consulted, they would likely not have suffered such dramatic and public consequences. Whilst consultation should never be done purely for the sake of public image, it can play a vital part in ensuring continued public support.

A period of meaningful consultation can help companies make the best possible decisions, balancing the interests of all stakeholders against their commercial interests.  Consultation is not a vote, but the weight of opinion and arguments raised can help decision makers be more responsible across a range of issues, from employee health to sustainability.  In other words, it is good governance.