Charlotte Street Partners



A beach barbecue of high stakes

Written by Javier Maquieira, senior associate 
Edited by Scott Reid, associate partner
14 June 2021

Good morning,

If you follow any of the G7 leaders on social media, chances are you’ve been inundated by wholesome images of the attendees enjoying themselves at the Cornish resort of Carbis Bay while discussing their shared agenda for global action over the weekend.
Public gatherings aside, it was the substance and commitments – or lack thereof – resulting from the behind-the-scenes meetings that have made the headlines about the summit.
One of the group’s collective pledges is to end the pandemic and prepare for the future by donating at least one billion extra Covid-19 vaccines to developing countries over the next year. However, the World Health Organisation has estimated that it would take 11 billion doses to end the pandemic, which suggests G7 leaders could be doing a lot more.
Another big promise included in the G7 communiqué is a “values-driven, high-standard and transparent” partnership to support lower- and middle-income countries in building better infrastructure. Through their proposed spending plan – the financial details of which are unknown – the group is seeking to rival China’s Belt and Road Initiative, which has helped finance trains, roads, and ports in many countries using so-called “debt diplomacy”.
While there isn’t consensus yet among G7 leaders over whether to treat Beijing as a partner, a competitor, or a security threat, a spokesman for the Chinese embassy in London sent a clear message back to the group on Sunday: “The days when global decisions were dictated by a small group of countries are long gone.”
But if there’s one item on the agenda that has drawn much disappointment is the group’s plans on climate action. Included were commitments to reach “net zero no later than 2050”, keeping the projected global temperature rise to 1.5C, and raising $100bn a year to help developing countries cut emissions, but with little detail on how that figure would be raised.
Finally, there was the elephant in the room: the Northern Ireland Protocol. Despite the “fantastic degree of harmonies between the leaders”, as Boris Johnson put it, the UK prime minister and French president Emmanuel Macron staged a war of words over the protocol. Rather than facilitating a solution, if anything, the G7 summit seems to have aggravated the situation.  
Given that Johnson will next meet with EU leaders during COP26 in November, time is short to flesh out the detail of these and further commitments.  


Naftali Bennett has been sworn in as prime minister of Israel, putting an end to Benjamin Netanyahu’s 12-year hold on power after the parliament supported the new coalition government with a thin majority of 60-59. Bennett, a far-right advocate for the settler movement in the Palestinian territories, will lead the government until September 2023 as part of a power-sharing deal with centrist opposition leader Yair Lapid.
Boris Johnson is expected to announce later today a delay to the final relaxation of Covid-19 restrictions for England. The postponement, which officials expect to last for four weeks from 21 June, could be limited to two weeks if the vaccination and infection data prove better than expected. (£)
Arlene Foster is to resign as the first minister of Northern Ireland after her replacement as the leader of the Democratic Unionist Party (DUP) six weeks ago. The new DUP leader, Edwin Poots, now requires support from Sinn Féin for the appointment of his party’s nominee, Paul Givan, as Foster’s successor. However, Sinn Féin has threatened to block Givan’s appointment, arguing it does not believe Poots would deliver a commitment to implement Irish language legislation.

Business and economy

The number of UK airport passengers dropped by 75% to 74 million in 2020, according to annual Civil Association Authority data. Cardiff airport suffered the largest drop in passenger numbers at 86.7%, while Britain’s largest airport, London-Heathrow, recorded a 72.7% decline from 80.9 million passengers in 2019 to 22.1 million last year. The Airport Operators Association said the figures demonstrated the devastating impact of the Covid-19 pandemic on the aviation industry.
WhatsApp has launched a new ad campaign in the UK and Germany designed to promote the benefits of end-to-end encryption and reiterate its “commitment to privacy”. The marketing campaign comes after a customer backlash against changes to the messaging platform’s terms and conditions, which sparked confusion among some users over possible increased data sharing.
JD Sports is facing an investor backlash over its “inappropriate” pay policy after the retailer handed its executive chairman, Peter Cowgill, a £4.3m bonus despite benefiting from millions of pounds in Covid-19 support. The company will hold its annual general meeting on 1 July, when shareholders will be invited to vote on the remuneration report alongside other resolutions.

Columns of note

Writing in The Guardian, former prime minister Gordon Brown argues that the G7 summit will be remembered only for failing to honour Boris Johnson’s previous pledge to vaccinate the world. He criticises the group’s leaders for their inability to solve the immediate emergency and concludes it is difficult to see how Johnson’s promise to deliver “the single greatest feat in medical history” will be met, given the lack of decisive action among the world’s richest nations.
In the Financial Times, Rana Foroohar writes that market penalties for firms making bad risk decisions around the climate are broader than we might think, as they now stem from perceptions of adverse outcomes from natural disasters as bad management, rather than bad luck. If regulators have their way, Foroohar argues, risks will become more explicit and companies will be forced to quantify their ESG footprint in ways that make it easy to compare sectors and individual firms’ efforts. When and if that happens, the market impact would be hard to overstate. (£)

Cartoon source: The Times


The week ahead

The US, Britain and other Nato allies are today expected to sharpen their language on the challenges posed by China, keep up pressure on Russia, and for the first time make tackling climate change a security priority.
The in-person gathering in Brussels comes ahead of Joe Biden’s first face-to-face meeting with his Russian counterpart, Vladimir Putin, in Switzerland on Wednesday.
On Tuesday, figures from the Office for National Statistics are expected to reinforce recent signs of improvement in the labour market in the UK. Meanwhile, Wednesday’s consumer prices will be closely watched for signs of rising inflation, which increased by 1.5% on the year in April, pushing inflation closer to the Bank of England’s two per cent target.
Tesco’s trading update on Friday will give further clarity on the durability of the online grocery boom after the pandemic saw Britain’s biggest retailer rapidly scale up its online capacity to deliver 1.6 million orders a week.
Although the week ahead features three major updates from various central banks, no changes are expected from any. All eyes will be on the Federal Reserve as investors wait for a reaction to the inflation jump in May and what rising price pressures means for the future path of monetary policy.

What’s happening today?

Augmentum Fint.
Draper Esp

Altus Strategi.
Arix Bioscience
Lexington Gold
Medica Group P.
Mirriad Advert.
Nb Global
Plant Health
Sourcebio Int
Spectra (Unres)
TBC Bank Group
The Mission Group
Trian Investors

Int. economic announcements
(10:00) Industrial Production (EU)

Source: Financial Times

did you know

George Washington never wore a wig. He was a natural redhead and powdered it white to look more fashionable. (source: @8fact)

Parliamentary highlights

House of Commons

Oral questions
Housing, Communities and Local Government (including Topical Questions)
National Insurance Contributions Bill: Second Reading
Business of the House (Private Members’ Bills)
Antisocial behaviour involving vehicles

House of Lords 

Oral questions
Proof of vaccination for those wishing to travel who have no smart phone or access to the verification app
Suggestion of an inquiry on the constitution
Data relating to the safety of COVID-19 vaccines in pregnant women
Cost to public funds of people based outside the UK using UK courts to mount libel and deformation cases against those in the UK
Collapse of trials relating to the Hillsborough Disaster and subsequent developments
Judicial review judgement on Napier Barracks contingency asylum accommodation
Professional Qualifications Bill [HL] – committee stage (day 2)

Scottish parliament 

No business scheduled.

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