Scottish independence: Businesses to break silence

Businesses are set to increase their involvement in the independence debate. Picture: TSPL
Businesses are set to increase their involvement in the independence debate. Picture: TSPL
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BUSINESSES are preparing to ramp up their involvement in the independence debate by highlighting the potential pitfalls of a breakaway state to investors and other stakeholders.

A number of big companies are known to be looking to include independence risk assessments in their trading statements over the coming months in order to satisfy shareholders and customers who remain uncertain and cautious about the outcome of September’s referendum.

A formalised statement is also likely to be insisted upon in order to meet corporate governance rules. The Financial Reporting Council told Scotland on Sunday: “The Companies Act and the corporate governance code essentially require directors to set out the prospects for the business, highlighting principal risks. So if boards consider that a vote in favour of Scottish independence is a strategic issue or a principal risk, then disclosure should be made.”

Lloyds Banking Group is understood to have postponed such a move until the summer after initially planning to include a risk assessment in this week’s full-year results. It is now likely to do so when it publishes half-year figures in the summer, just a month before the referendum. It is not known whether the government – its 33 per cent shareholder – had any influence over the decision to delay.

TSB, a Lloyds subsidiary, intends to float on the stock market in the early summer, and because it is a Scottish-registered company it too is expected to alert investors to the potential impact of independence.

These latest moves are seen as part of a significant shift in the mood of business to become more active and direct participants in the debate, which has thus far been dominated by statements from the CBI and the Institute of Directors.

Scottish Financial Enterprise, the trade body for the financial services sector, has recently highlighted the concerns of the fund management sector and is due to publish a report on the issue which will assess five key factors: currency, European membership, regulation, the single market and the transition period from the vote to the setting up of any new state. No date has been set for publication, though it could be issued next month.

While the majority of companies insist that the vote is one for the Scottish people, a number of business leaders are now showing a greater willingness to speak up. Until now, most who have expressed an opinion have tended to come from the Yes campaign, including Scottish entrepreneur Jim McColl and property company boss Dan Macdonald.

Last week’s intervention by BP’s chief Bob Dudley was regarded as a turning point by bringing an international company into the debate. His comments were picked up by both sides of the debate after he said it posed “big uncertainties”.