Lehman Brothers’ 2008 bankruptcy has been blamed for many things – the global downturn, some bad movies and, increasingly, deep distrust between governments and various arms of the economy.
Business events caught the brunt of this in an unexpected way; a hefty chunk of the US government bailout to financial giant AIG ended up being spent in Las Vegas as part of a corporate event and at a week-long retreat for its executives at the five-star St. Regis Monarch Beach Resort in California. Facebook pictures of staff unwinding didn’t help. President Obama stepped into the row and complained that taxpayers’ dimes were being wasted.
“The US and UK governments are wary of embarrassment, especially when it comes to things that seem frivolous to their constituents, like a big conference that people suspect is really a jolly,” says Professor Joe Goldblatt, director of the International Centre for the Study of Planned Events at Edinburgh’s Queen Margaret University. “But right now the UK needs huge business development opportunities and the best way to achieve them is to host a conference so that global chief executives can come here and say – hey, this is good place to do business.”
The success of the Olympics shows how far politicians are prepared to go for events they think will win them votes or give them a little global clout – from then London mayor Ken Livingstone flying out to support the bid to Labour and Conservative prime ministers giving vocal and financial support. MPs, ministers and, of course, current London mayor Boris Johnson, took advantage of every photo call going. At the end of the day, however, there’s no empirical evidence that holding the Olympics ever bestows any long-term benefit on the host nation.
The UK needs huge business development opportunities and the best way to achieve them is to host a conference so that global chief executives can come here and say – hey, this is good place to do business
“If you try and get a politician to attend the opening event, or even write a letter in support of a bid for a major agricultural show, technical exhibition or medical conference, you get nothing like the same level of enthusiasm,” argues Michael Hirst, chairman of the Business Visits and Events Partnership (BVEP), which has spent years lobbying for greater recognition of the business events sector’s economic contribution to the UK, from generating employment to developing trade and regenerating cities.
“And yet the value of being seen as a major destination for scientific conferences is as great – or greater – than a sporting event in terms of its economic and social benefit. The return on investment from securing an international conference is 12.5:1.”
According to BVEP figures, meetings and events showcase Britain to more than seven million international business visitors every year, boosting trade and exports through more than £100 billion of goods sold at exhibitions and trade shows. Indeed, more than a fifth of tourism benefits from the London 2012 Olympic and Paralympic Games came from additional business visits expenditure, equivalent to over £500 million with over 90 locations in the capital city hosting sponsor showrooms and exhibition spaces.
Mr Hirst isn’t looking for extensive infrastructure development – there is already significant investment in the industry with more than £12 billion currently being spent on event venues and 20 per cent of existing facilities reporting upgrades and extensions – although he’d like to see more public buildings hosting more international events.
He is asking for the UK government to treat the sector with the same respect that overseas governments have for their own events industries. “There is greater alignment of events to a country’s economic strategy,” he says. “Although we’ve got some great venues in the UK, we should be known for more than just doing small medical conferences well.”
Elsewhere in the world there’s a tight link between the business events sector and government at local, regional and national level. Most German cities, for instance, host a trade fairground, like Hannover’s Messe, ironically founded by the British government in 1947, which has its own railway station and offers 30 aircraft hangar-sized halls covering 5.3 million square feet. In South Korea, business events are so tightly co-ordinated with the nation’s economic needs that Seoul has been known to refuse to host inappropriate events, Mr Hirst notes. In Australia, Business Events Sydney boasts a lock-tight partnership they define as a “whole of city” approach.
“Generally, every bid that leaves our office includes some form of government support – local, state or federal,” says Lyn Lewis-Smith, Business Events Sydney’s chief executive. “They know that business events delegates stimulate the local visitor economy – they sleep in our hotels, dine in our restaurants and shop in our stores.
“But in New South Wales, it’s now understood at high and broad levels that business events are worth far more than the tally of tourism receipts. Business events contribute to a healthy, global knowledge economy. By securing events that fall within a sector that’s identified as a priority sector for the NSW government – of which there are ten – we can leverage opportunities for trade and investment, knowledge exchange, collaboration and innovation. All of this helps to fuel productivity. All of this benefits the state’s economy, communities and industries.”
In the UK, the government is keen to say that it understands Mr Hirst’s concerns and is pushing a ministerial bid support initiative in which the Department for Culture, Media & Sport will channel requests from, say, an agricultural event to the relevant MPs and ministers, urging a response.
“Over the past couple of years, led by London 2012, the UK has transformed its reputation for hosting global events and direct ministerial support for bids has been a key part in securing the many world class sports events coming to this country up to 2020,” says Minister for Sport and Tourism Hugh Robertson. “I now want to ensure that what has worked for sports can now work for the economy and tourism. The ministerial bid support initiative is a key partnership between government, VisitEngland and stakeholders from a range of different sectors to give it the best possible chance of securing major international events.”
Mr Hirst is hopeful this means things are changing, although Professor Goldblatt remains unimpressed. “I’m sure the minister means well,” he says, “but can you imagine ministerial instructions for a key event in one constituency playing well with coalition partners? We need a political sea change where all parties start taking business events seriously at last. Then we might get something done.”