Once the shareholders have given their overwhelming support (93.3% of the Board in favour) to the transfer of Ferrovial’s headquarters to the Netherlands and hoping that, barring surprises, we will find the company listed on Wall Street before end of the year, it is convenient to draw the lessons from a very noisy economic, political and media case.
1.- Choose the moment well
It is the first great lesson of this case. To begin with, as an expert points out, “it has not been the best time & rdquor; for the company to make a decision of this type: “as the current political situation is, with the elections close, the government’s fierce criticism of businessmen and also being a listed company…”. These sources highlight that in a case of this type, the company must always carry out an analysis of risks and opportunities, and among the first is to choose the most favorable ‘momentum’. Some even point out that taking into account the possibility of a change of government before the end of the year, it would not have been unreasonable to wait for 2024, where, in the event of an electoral turnaround, there could be an Executive more receptive to business sensitivities.
Being in the middle of an electoral or multi-electoral process Ferrovial has been subjected to the beating of both political poles. From the Government to try to take advantage of its electorate and that of its partner. From the opposition to charge against the Executive also for electoral interest.
2.- Respect the times of power
This second lesson arises rather from a doubt. Should the company have communicated its decision to the Government earlier? Should I even have agreed to it? One of the criticisms that have been made of Ferrovial stems from the fact that he announced his departure to the highest level of the Executive (president and economic vice president) just a few hours before making it public, which left Moncloa no room for reaction or even digestion. We cannot know to what extent this contributed to the subsequent festering. We know that, in an unprecedented way, the Prime Minister himself, Pedro Sánchez, cited Rafael del Pino by name just 48 hours after announcing the goodbye and accused him of not being a “committed” businessman.
The answer to the question is therefore not clear. “The question is that there may also be a problem of the company’s lack of confidence in the current Executive,” they point out in the market. What would have happened if you told a government that has not hesitated to attack the main businessmen with names and surnames that you were leaving Spain?
3.- Communication matters
It is a point on which there is a clear consensus. The communication of the company, especially in the initial moments, It was not as successful as expected. “It was very cold initially & rdquor ;, they explain from a large specialized agency. In reality, the proposal to change the headquarters to the Netherlands reached the media and therefore the public through a relevant event in the Securities and Exchange Commission (CNMV), the market regulator. From the outset, there was a feeling that the company had not drawn up a forceful and specific communication and had underestimated the impact of its decision.
The fact is that it did not seriously take action on the matter until a few days had passed, while the Government had been attacking Ferrovial and its president for some time now, with all its artillery and from all fronts (personal, business, tax, political…) . After reacting and going to explain its position to the media, the company managed to get many opinion creators to position themselves, if not totally in favor, then against the government’s reaction.
4.- Select the words carefully
In the first moments of the communication, Ferrovial slipped the idea that it was moving the headquarters to the Netherlands because it was an environment with greater legal certainty. For many, it was a manual error because it had two dangerous readings: Spain has less legal certainty (an idea to which the Government could not remain impassive) and the decision has to do with the harassment to which the business class has been subjected (which was also unacceptable due to the risk of it occurring a call effect between companies). In fact, the subsequent rectification of the company, clarifying that Spain has legal security comparable to that of the main European countries, was quickly celebrated by the vice president Nadia Calviño in what is currently her only victory in this crisis.
“Another thing,” stresses an expert, “would have been to talk about legal certainty, which has more to do with the stability of the legal framework, but Spain’s legal certainty is guaranteed by Europe.” As the economist Miguel Ángel Bernal points out, “you cannot change or have a changing legal framework& rdquor ;.
5.- Attacking companies is not free
This is a lesson that the Government should take note of. In the first place because the departure of Ferrovial could have served as a drag for some companies that feel attacked by the Government, or even for some who do not like the climate generated by some members of the Executive against big business. Let’s remember that the president of Mercadona, Juan Roig, was branded a “ruthless capitalist”; to that of Inditex, Amancio Ortega, of “tax evader& rdquor ;; the President of the Government described as a businessman “little compromised & rdquor; to Rafael del Pino… Ferrovial, as its president recalled, frames the operation “in the freedom of establishment that nourishes the very essence of the European Union& rdquor ;. It was not a random comment. It was a salute directed at Sánchez himself: Spain assumes the presidency of the Council of the European Union on July 1, for the fifth time. “How do you think in Moncloa that the attacks on Ferrovial feel in Brussels? & rdquor ;, business sources ask themselves.
6.- Do not use institutions in vain
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From almost the first minutes of the case, the Government used all kinds of arguments to attack Ferrovial’s decision. He cited the anti-takeover shield, something discredited by the experts because the operation is simply not a takeover bid; he hinted that there were motivations of self-interest and taxation of which nothing is known so far & mldr; but, nevertheless, the most worrying thing was invoking the Tax Agency. First it slipped that the Agency could take action on the matter and later (until the same Thursday of the meeting) that it would analyze if the company could take advantage of the tax advantages of the merger regime of the Corporation Tax. In the letter from the Secretary of State for the Economy, Gonzalo García, to the CEO of Ferrovial, Ignacio Madridejos, the former justified that shareholders should vote knowing “their possible risks or contingencies”.
In the economic world, this was interpreted not only as a veiled threat, but as that the Government was not going to hesitate to use the Tax Agency to try to torpedo the operation. The problem is that the outcome of the Agency’s action, if carried out, will be known in one or two years. But what is serious is that it leaves behind in society the residue that institutions can be used based on political interests, something very serious in a democracy. As Madridejos himself was in charge of quickly pointing out: “the Secretary of State for the Economy should not prejudge or condition the purely technical criteria that would apply to other organizations& rdquor ;.