Over 15 years as executive director for the Institute of Directors in Scotland, I have written an annual review each year. Despite a tumultuous few years, 2018 takes the prize for being the most explosive and worrying.
That really is saying something. My years at the IoD, which come to an end in 2019, have included the near-collapse of Bank of Scotland owner HBOS and Royal Bank of Scotland, an independence referendum for Scotland, a whole range of local and international crises and conflagrations, as well as terrorist attacks and some exceptionally bad examples of corporate governance.
This year has me at my most disconcerted. Certainly, the most concerned I have ever been in my lifetime by the future of Scotland’s economy. 2019 looks very tough; and that is an understatement. It could be chaos, at least for a time.
Perhaps the biggest concern, set against the challenges we face daily, is the complete lack of political leadership at a UK level, from any party or any individual. No one, apart from Theresa May, has a plan; and no one likes hers.
So where do we go from here?
The answer, as it is for a business in such a position, is to stand back for a few moments, look at the current situation, do some analysis, devise a plan and then implement it. Most importantly, especially in our current situation, businesses must consider what other stakeholders think or might want if they are to support your plans.
We need politicians to come forward with a suggested strategy for our future – starting now – and then agree the best one and get on with it. There is no time to lose.
Discussion around the Scottish economy must be paramount, as the future of Scotland’s finances depend on it. Business is largely agnostic when it comes to politics – except where it hinders or helps directly. However, we all want the economy to be number one on the agenda for all parties and some real attention and innovation focused on developing and improving it would be welcome.
If they haven’t already, Scottish businesses need to spend the start of 2019 preparing for a post-Brexit world. In a recent survey of IoD members, 60% of businesses said they had not taken any serious steps to prepare, whether there is a deal or no deal.
The fact is, Scotland currently trades 3.6 times more with the rest of the UK than with the EU. If businesses class the EU as their biggest market, then they need to be looking further afield, or indeed closer to home to establish new markets, in case of delays and difficulties post-Brexit.
In Scotland we face the challenge of depopulation over the coming years, and there is little likelihood that politicians will have the answer to this one. We need to ensure those of us in business are using everything in our toolbox to attract people of all levels and backgrounds to come and work in our country, to help us build our economy for the future as immigrants have done for Scotland for years – particularly the last 50. That the tax regime is now so divergent from that of the UK just means we have to work doubly hard to do this.
Because of our young Scots, and 2018 has been their year, I am not totally miserable for the future; ultimately we will thrive and survive as we always do, just much more slowly outside the EU.
David Watt is executive director of the Institute of Directors in Scotland.
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