Five key enabling priorities to support the economic recovery

We know from speaking to SFE members there are five key enabling priorities in supporting the economic recovery ahead – skills development, digital innovation, promoting the industry, sustainability and navigating geopolitical uncertainty. While the pandemic has adjusted the weighting, these priorities and the broad sentiment of our members are reinforced by the themes in EY's Financial Services Scotland report here, writes SFE Chair Philip Grant.

We are hosting an event to discuss the findings of the report with Philip, Sue Dawe of EY Scotland and Stephen Ingledew of FinTech Scotland on Friday 13 November. More details here. 

Scotland’s financial services sector recognises the vital economic role and societal responsibilities it has to customers, colleagues and our communities. Delivering on this has never been more important as we all navigate the COVID-19 pandemic and the resulting need for economic and social recovery.

From facilitating the government-backed COVID-19 pandemic support for businesses, helping individuals with the financial space they need to manage the uncertainty of the time, providing mortgages that allow people to buy their own home, and managing the funds that invest in the economy and help people save for retirement, to protecting and insuring what is important to them, a strong financial services sector is critical to Scotland’s economic and societal wellbeing.

As the industry’s representative body, Scottish Financial Enterprise has a central role in the development of the value of the sector through collaboration across our membership. Our community’s willingness to work together and participate in Scotland’s Financial Services Strategy has seen the establishment of FinTech Scotland, successful initiatives in schools and colleges, and stronger relationships with government and the regulator.

Over the past six months, we have been in constant dialogue with both the UK and Scottish Governments in a range of forums to offer our collective insight and challenge where necessary. The SFE Board provided recommendations to the Advisory Group on Economic Recovery, led by Benny Higgins, and I joined the Enterprise & Skills Strategic Board sub-group, led by Nora Senior, to consider what measures are necessary to mitigate the labour market impacts from the COVID-19 pandemic. These are just two examples of business and government constructively engaging with the common goal of finding solutions to evolving economic and societal challenges.

Looking ahead, our members tell us that that skills development, promoting the industry, capitalising on new opportunities (especially in FinTech) and navigating the geopolitical uncertainty remain key enabling priorities in supporting the economic recovery.

While the pandemic has adjusted the weighting of some of these priorities, the themes highlighted in this report by EY Scotland are consistent with the sentiment of our members, which range from global financial businesses headquartered in Scotland to small start-ups and professional services firms.

Our sector, and indeed many others, will be forced to make difficult decisions in the months ahead as new challenges emerge from the ongoing health crisis. However, I believe there will be opportunities for our sector to support customers, colleagues and communities in innovative ways.

Scotland’s thriving FinTech ecosystem is one of the strongest in Europe and the number of FinTech SMEs has doubled since last summer. Innovation, inclusion and collaboration are the key drivers behind our FinTech cluster and it’s promising to see numerous examples of Scottish FinTechs accelerating the application of their innovative propositions to provide immediate support to citizens and businesses, while helping build a more digitally-engaged society that will shape our future.

Interestingly, a straw poll of SFE members in August found 100% of respondents agree there is a compelling and innovative future ahead in financial services as a direct result of the pandemic. The same poll also found that 87% think financial services organisations should continue to operate remotely post pandemic. While much of our industry continues to work remotely, it’s realistic to imagine a blended model of home and office working.

As well as digital innovation, providing a platform for the next generation to enter the industry and upskilling existing colleagues so we are ready for the challenges of the future must remain high on the agenda. This is why SFE has pivoted initiatives such as our Unified Schools Programme to an online offering to encourage and inspire school pupils to consider and explore the career opportunities available in financial services.

The changing political and regulatory environment both here and overseas continues to be front of mind for the wider business community. Our members are confident and ambitious that Scotland’s financial services ecosystem has the necessary fundamentals to remain a leading financial centre.

SFE will always act in the best interests of our members and represent the collective industry view. We will continue to work constructively with both Governments, their agencies and key partners to ensure the success of our industry and, more importantly, wider society. As Chair of SFE, I firmly believe collaboration across our industry can make a positive difference to people’s lives and the communities in which we live – now and in the future. This demands our absolute focus, now more than ever.