Scotland proves increasingly appealing as financial services destination

Scotland will top the rankings of key European finance hubs for life satisfaction in 2021, seeing potential for the industry to prosper further with the right support, according to a new survey.

Scotland has consistently improved its life satisfaction score in relation to European peers, says EY. Picture: Lisa Ferguson.

Accountancy giant EY has today published a report, which it says is the first of its kind, on how Scotland’s finance sector – which it deems critical to economic and societal wellbeing north of the Border – can build an even brighter future.

As for strengths, it said the leading reason for investment in the sector is relocation from other UK locations, such as London and the South East, with nearly a third of respondents deciding to move from other UK locations to invest in Scotland.

EY noted in the study – with research undertaken before the pandemic – that Scotland had “consistently” improved its life satisfaction score in relation to European peers, including the UK as a whole, the Netherlands, Ireland, Germany, France and Luxembourg.

Sue Dawe of EY in Scotland said the nation has a very strong case to compete as a finance hub. Picture: contributed.

Scotland has risen from fourth in 2011 to second in 2016, and will be top in 2021, said EY, adding: “Forecasts suggest a 30 per cent disparity between Scotland and London.”

One respondent was quoted as saying: “There is a large talent pool from universities and Scotland is a large financial centre. There is no real reason for so much to be done in London, given the relative cost difference.”

A third of organisations consulted named the standard and quality of life for employees as a reason that Scotland had remained an attractive place to operate. When looking at all results and rankings, this factor placed third overall, after access to a skilled workforce at 81 per cent and low set-up costs at 38 per cent.

The report follows the news from EY that Scottish listed companies proved more resilient than their English counterparts in the first three quarters of this year.

The accountancy firm said today that Scotland’s financial services industry showed strong growth prior to Covid-19, with 86 per cent of respondents growing staff between 2014 and 2019.

Sue Dawe, head of financial services at EY in Scotland, said the nation had an "extremely strong case to compete” as a finance hub. “Scotland’s ability to attract, develop and retain talent will prove critical to the future success of the financial services sector," she said.

Teamwork

Additionally, some of those surveyed saw Scotland’s size enabling it to help foster close collaboration between government, businesses and educational institutions. Ms Dawe said: “Ensuring we have the depth of skills required for future growth will need ongoing collaboration within the industry, cross-sector and in partnership with governments.”

Philip Grant, chairman of Scottish Financial Enterprise (SFE), said: “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 this report by EY.”

He said how a straw poll of SFE members in August found that all saw a “compelling and innovative” future in financial services due to the pandemic. “Our members are confident and ambitious that Scotland’s financial services ecosystem has the necessary fundamentals to remain a leading financial centre,” he said.

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