Scotland’s international success as a financial services centre is rooted in over 350 years of world-leading expertise. It has been maintained through a tireless commitment to innovation, investing in the development of talented people, and resilience and adaptability in the face of change. In light of the COVID-19 pandemic, this is more important than ever.
The industry in Scotland has a unique and powerful blend of attributes. These are neatly knitted together to create an ecosystem of financial services that is internationally renowned for being much more than the sum of its parts. This report analyses the nature of the financial services industry in Scotland, both quantitatively and qualitatively, to reveal the key aspects responsible for driving its growth and success. It also identifies some of the industry’s current challenges and potential threats to Scotland as a world-leading financial services centre, with recommendations to mitigate against these.
Our research includes the views of a selection of 21 leading industry executives in Scotland, gathered via one-to-one interviews between August and October 2019. These interviews took place prior to the COVID-19 pandemic and the resulting lockdown and, whilst these events have clearly had an impact on the sector in Scotland, as elsewhere, the key messages remain as valid today as they did then. The areas considered in this report include: workforce talent and skills; future ambitions to grow and invest in Scotland; and considerations relating to the political landscape.
When overlaid with key socio-economic and industry data, the analysis brings fresh understanding to the mix of characteristics that define Scotland’s financial services industry. These characteristics can be broadly grouped into three areas: quality, skills and value. Each has demonstrable positive features for both the employer and the individuals who work in Scotland.
In the field of financial services, Scotland offers quality in two important senses. First, it is a world-renowned financial centre. The Global Financial Centres Index places Edinburgh in 13th position worldwide in terms of competitiveness, ahead of other European hubs including Frankfurt, Paris, Amsterdam, Stockholm, Brussels and Dublin.
The attractiveness of Scotland is clear. At the time of interview, the majority of respondents (67%) planned to establish new operations in Scotland or expand existing ones, mostly within the next few years.
From a financial technology (FinTech) perspective, at the start of 2020 the sector gained formal accreditation as the UK’s first FinTech cluster of excellence.
Secondly, Scotland has also been shown to offer a greater quality of life compared with many other financial centres. In terms of measured life satisfaction ratings, it has scored higher than the UK average in every year measured since 2011. In addition to this, Scotland was predicted to achieve the highest life satisfaction score across the main financial centres in Europe by 2021. Remote working has become the ‘normal’ for many industries during the COVID-19 pandemic and it remains to be seen what impact this will have on ways of working in the future. In addition, a key consideration for where and how people work is likely to be quality of life.