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Chance for British industry to shine [Daily Mail, London :: ](Daily Mail (London, England) Via Acquire Media NewsEdge) July 12--With the biennial Farnborough Air Show taking off on Monday it's hard to dispel fears the expected star of the show, Lockheed Martin's new F-35 jet fighter, will fail to make it across the Atlantic for its first flight in British skies. The high-tech aircraft, dubbed the Joint Strike Fighter, yesterday remained grounded in the US following an engine fire that threatens its much-anticipated debut. Having already missed the Royal International Air Tattoo at RAF Fairford this weekend, if the F-35 doesn't turn up at Farnborough it will raise serious questions about the world's biggest-ever defence programme, which is already late and over budget. In turn, that would be a serious worry for this country's aerospace and defence sector, which claims a sizeable chunk of the work making the aircraft. BAE Systems accounts for 15pc of every F-35 that will roll off the production line in Fort Worth, Texas. Happily the Lightning II, as the F-35 will be called in service with the RAF and Royal Navy, is not the only show in town for a sector that is battling swingeing cuts to domestic military budgets. According to lobby group ADS, British firms have seen a significant increase in their share of the global defence exports market, rising to 22pc last year. Why is this? While defence spending in traditional markets like Britain and the US is down, around two thirds of our specialist manufacturers are pursuing growth by targeting overseas customers. That should help reduce the over-reliance on the home market, which is currently 70pc of industry sales. ADS data shows that in 2013 defence exports contributed just short of pounds sterling 10bn to the UK economy, an increase of 11pc on the previous year. Much of the gains have come from the development of high-value, advanced technology equipment and services such as cyber security systems. With a turnover of almost pounds sterling 25bn last year and directly supporting more than 162,000 jobs plus countless more indirectly, Britain's defence sector remains a crucial part of the economy. Just how seriously the sector is being taken will be revealed at Farnborough, when more details about the Defence Growth Partnership are due to be unveiled. At Farnborough the plan for how the strategy will be rolled out is to be detailed, with the goal of ensuring UK industry retains its global position and boosts its competitiveness. Research and development is the foundation of the current renaissance in the aerospace sector. And research from KPMG has shown investment in such work is set to increase. It has paid dividends for many innovative British small to medium-sized companies which have tapped into the supply chain for projects like the Eurofighter Typhoon. That means we can expect domestic firms to take to their stands at Farnborough with renewed pride, enthusiasm and confidence for the year ahead. Whether or not the flagship F-35 turns up, the show remains a fantastic opportunity for the best of British industry to show off. ___ Shareholder engagement may finally be evolving for the better after the number of discussions about executive pay-outs has increased during the 2014 season for annual meetings. As this year featured the debut of a binding investor vote on remuneration policies, the relationship between quoted companies and their shareholders has undoubtedly changed. Engineer Kentz was the first firm to suffer a defeat on pay under the new rules, proving that now the people who own shares can really influence corporate policy by refusing to back lavish pay-outs. Analysis of voting records by Standard Life Investments of those annual meetings that have already taken place found companies are more willing to talk to the insurers, pension funds and other institutional investors that own the stock. The hope is this will continue and eventually encompass broader topics from corporate values and business practices to the quality of auditing, succession planning to boardroom diversity. However, Standard Life warns the new regime isn't yet an unqualified success. Rather it's a step on the path towards better corporate governance, stewardship, engagement and trust in the companies to which savers and investors entrust their futures. One of the disappointments of this year has been the tendency of some companies to only offer up draft pay policies to investors at the last minute, leaving too little time for change and making a mockery of the idea of consultation. Here's hoping 2015 will yield even better results. ___ Ben Griffiths is City News Editor of the Daily Mail ___ (c)2014 Daily Mail (London, ) Visit the Daily Mail (London, ) at www.dailymail.co.uk/home/index.html Distributed by MCT Information Services |