Is Glasgow’s financial services industry on the cusp of something remarkable?
Five months ago the eyes of the world were firmly fixated on Scotland’s largest city.
The looming architecture of the Scottish Events Campus– the distinctive post-industrial structures of the Armadillo and the Hydro, juxtaposed against the Finnieston Crane on the bank of the River Clyde - became the defining symbols of the global climate crisis as COP26 got under way.
While senior politicians stole the headlines and delegates packed the Exhibition Centre floors, there was a genuine sense of opportunity across the city. Yet the feeling amongst many Glaswegians seemed to be more pragmatic. While promises of opportunity were welcome, there remained a steadfast unwillingness to get carried away.
Behind the glowing façade of shiny riverside buildings and COP26 insignia, the stark challenges of poverty and inequality are still very real.
In a city that once produced one third of all British railway locomotives and one fifth of the ships in the entire world, opportunities have been and gone before. For the seasoned onlooker, seeing is believing.
But something transformational is brewing. While Glasgow has had a major presence in financial services for centuries, the recent growth of the sector has been turning heads and raising questions as to whether the city is on the cusp of something remarkable.
In this year’s internationally recognised Global Financial Services Index, Glasgow finds itself in 52nd position, up 13 places from the year before, and 31 places since 2019. This makes it the third largest financial centre in the UK behind London and Edinburgh, and means it ties with Berlin as the biggest climber on the index in Western Europe.
The jewel in the crown of this recent growth is Barclays’ new state-of-the-art campus in Tradeston. The building now houses the bank’s technology, operations, and functions teams and is expected to employ around 5000 people by 2023.
““We have created something transformative. A shared space that will have a lasting impact on Glasgow, its people and the local economy”. ”
Anderson says Glasgow’s strong pipeline of talent and key partnerships with local universities were important factors in Barclays decision to invest: “These collaborative relationships help us to create the high value, high skilled roles needed to drive our business forward and provide the best outcomes for customers and clients.”
She also highlights the bank’s commitment to investing sustainably in the local community: “Taking a derelict brownfield site in an underinvested area we have created a city centre park with facilities to bring the community together. Micro-businesses and social enterprises are given free space to showcase their products to the public. Local entrepreneurs have been given a place to call home. Our on-campus sustainability centre also means that Barclays can reduce, reuse, and recycle all waste on site while ensuring the campus is net zero across all its energy needs.”
The impact of COP26 is seen as a catalyst in driving new investment as the financial services begins to play a major role in the race to net zero.
“It really feels like an exciting moment for Glasgow” says Fraser Wilson, Head of Financial Services at PwC Scotland. “COP26 was a huge boost for the city’s green ambitions, and there is also a growing buzz around Glasgow’s technology and innovation credentials, so you have all of these separate pieces coming together and creating a real sense of momentum.”
“Financial services is at the heart of this momentum. The sector is PwC’s largest market in Scotland and we are expanding our financial services team in the city to meet growing demand. Glasgow is a valuable part of our broader ecosystem in Scotland and the rest of the UK and has a key role to play in our plans for the future.”
Glasgow’s strong tech scene, combined with its growing base of financial institutions which includes household names like Morgan Stanley, Santander and Virgin Money, are helping to attract fintech and support firms from across the sector into the area. Consumer Credit firm Experian are one such example, and the company has recently established a new hub on Sauchiehall Street.
“Experian’s Glasgow hub brings together our innovation and data science teams so that we can work more closely with our clients and develop new ideas for the future” says Derek Garriock, Director of Innovation and Director of Scotland at Experian. “The business network and collaboration available to us from Glasgow is second to none – combined with the access to universities and the incredible, innovative Scottish fintech community. Scotland is big enough to have everything but small enough to find it – including access to a great talent pool to support our growth ambitions across the UK.”
With rising momentum comes added pressure for further growth and development, and politicians from across the political spectrum voiced their intentions to support the industry to build on its success in Glasgow.
Alison Thewliss, MP for Glasgow Central and SNP Westminster Treasury Spokesperson, said that Scotland’s growing strength in financial services showed the economy was built on strong foundations: “The expansion of Scotland’s financial services industry is bringing good jobs and investment to Glasgow. As Scotland seeks to reach out to the world, and build on our European and international trading relationships, we can ensure this important industry goes from strength to strength to the benefit of Glasgow and communities across our country.”
Paul Sweeney, Labour MSP for Glasgow, suggested that continued investment from the industry in the city could have an accelerator effect: “I am very hopeful that the industry’s growing presence in the city will result in a deepening of the value and supply chain, and that the thriving financial services ecosystem they are contributing towards will allow locally owned spin-offs to be more successful in the future.”
Dr Sandesh Gulhane, Scottish Conservative MSP for Glasgow, said that support for the industry was essential following the challenges of the pandemic. “As politicians, we need to support and encourage the wealth creators, the innovators, training and education, and ensure the business environment and services across Glasgow are gold standard.”
Politicians and businesses alike are united in their belief that Glasgow has a significant contribution to Scotland and the UK’s financial services industry. But what could hold back further success? Mike Wardle, co-author of Z/Yen’s Global Financial Centres Index, says that it comes down to the city’s reputation: “Glasgow’s rise in the index has been noteworthy, but the city doesn’t yet have the same name recognition of many of its key competitors. This will be crucial for its continued growth and success as a global financial centre.”
According to Sandy Begbie, Chief Executive of Scottish Financial Enterprise, the member body for finance in Scotland, building that reputation is a top priority for the sector: “Glasgow’s strengths in finance are well known across Scotland and the rest of the UK. Our task is on get the message out to an international audience, in order to attract more investment and to build those key relationships with other financial centres around the world.”
“Glasgow is a constituent part of a bigger story for us around financial services in Scotland. Alongside Edinburgh we have two truly outstanding financial centres, closely connected and easily accessible to one another. They are part of the same ecosystem which as a whole benefits from its close proximity to London. When you invest in Glasgow or Edinburgh, you are investing in this ecosystem, which is by every measure one of the best in the world.”