Tony Langham: “There’s not enough magic in financial services”

In the over three decades since it was founded, Lansons has built a reputation management business spanning multiple sectors, with around 70% of its clients in financial services.

As co-founder, CEO (until 2022) and Executive Chair, Tony Langham is a respected thought leader in reputation management. As well as working with numerous clients across many sectors, he also wrote a book in 2018 on the topic, which brought together experts as varied as Martin Lewis, Anthony Horowitz and Dido Harding.

The acquisition at the beginning of October by Team Farner aims to grow Lansons strategically, with the existing management team staying in charge.

Reflecting on three decades at Lansons, Tony tells the Financial Services Forum that what he is most proud of is realising the firm’s vision of “responsible capitalism”. This approach is reflected particularly in much of the company being transferred to colleagues so that at the time of sale, 35 people owned Lansons and only 13% of the money went to Tony and co-founder Clare Parsons themselves.

One of the takeaways from his 2018 book was that reputation proceeds from doing the right thing. What progress does he think financial services has made in the last 30 years?

He prefaces his comments by saying that there is “a lot of good” and that things have improved considerably since he started in the industry in the early 1980s.

Tony singles out some brands in the industry as having established strong reputations, such as Hargreaves Lansdown, St. James’s Place, Phoenix Group, Invesco and Fidelity.

But where the sector is still going wrong is it hasn’t necessarily learned to cater to both sides of the brain, the rational and emotional, or “logic and magic” as he calls it.

“There’s too much logic and not enough magic in financial services,” he says, citing Microsoft versus Apple as two archetypal companies who major on logic and magic respectively.

“Financial services has fewer Apples and more Microsofts.”

In the automotive sector, for example, he explains that Tesla is what has forced car companies to become progressive. While banks may have to respond to Monzo and Revolut, “no-one’s really made magic happen in the sector to the point where it’s made everyone else change.”

He notes that people do for example trust banks to look after their money, which shouldn’t be taken for granted when compared to some other countries, even if they don’t trust them to give them the financial advice to make the most of their life and their retirement.

“They do trust them at the core level. They do trust the bank to keep their money, look after it safely, pay it out and protect them from scams and fraud.”

Overall, though, he does think things have gone “a bit too slowly” on some issues of culture. Tony accepts that implementing these kinds of changes is easier said than done and advocates building a culture around metrics. But why has progress been slow?

“I’m inclined to say it’s our reluctance to admit that we live in a patriarchy and a world of white privilege. It’s the patriarchal society that’s at the root of those things still happening.”

The other challenge has been that improvements in some aspects of the industry’s culture has led to other unintended consequences. For example, he says that making it so banks can’t fail also means that there are no 100% mortgages, which has made it harder for people to get on the housing ladder.

He notes how, elsewhere in the market, the absence of banks from certain types of lending also let to payday loans filling the gap which banks had vacated.

Tony is sceptical about the potential of regulation to help the industry improve. Rather than choosing either rules-based or looser principles-based regulation, the FCA is trying to do both, which makes it “incredibly difficult for the industry to get better”.

For his part, Tony says he would prefer “looser principles-based regulation with a very tough sanctions regime.”

Looking ahead, Tony sees his main focus as client work. He stepped down as CEO of the business at the start of 2022, handing over to Gordon Tempest-Hay, freeing up several hours per day.

One current client is Link Fund Solutions, currently intending to distribute up to £230 million to investors in the former Woodford Equity Income Fund after its collapse a few years ago. Lansons is integrally involved in all aspects of communication around the proposed Scheme of Arrangement.

He’s also working with Atom Bank, the challenger established in 2013, which he says is “the largest organisation that we know of in Britain that allowed everyone to move to a four-day week while retaining their existing salaries.”

Tony says he is more interested in what’s next than in reflecting on the past.

“I hate looking back – I’ve never done it. I always look forward. I’m looking forward now as well, to a new life as Lansons Team Farner.”