SFE Insight | Business and Parliament - More in Common?

Sandy Macdonald, Public Policy & Communications Director, SFE

Business and Parliament - More in Common?

Last week was the 15th annual Business in Parliament Conference. which featured a series of sessions hearing from business leaders (including an outstanding keynote from Andrew Murphy, local lad and COO of John Lewis partnership), speeches from both the First Minister and the Deputy First Minister and a cross-party panel answering audience questions.

The theme of this year’s conference was “Sustainable Recovery: Maximising the Opportunities of the Next Decade”. As a member of the conference organising group, I had the privilege of facilitating a workshop on behalf of SFE and SCDI focusing on business purpose and net zero, fair work and inclusive prosperity, which was attended by MSPs, business leaders and industry representatives. Thanks to Richard Lochhead MSP, Minister for Just Transition, Employment and Fair Work; Claire Baker MSP, Convenor of the Economy and Fair Work committee; Amanda Young, Chief Sustainability Officer at abrdn and Co-Chair of the Scottish Business Purpose Commission; Judith Cruickshank, Managing Director, Commercial Mid-Market at Royal Bank of Scotland and Chair of the Scotland Leadership Board of Business in the Community; and Jamie Grant, co-owner and Director of Glen Lyon Coffee Roasters; who all  spoke in the workshop; as well as excellent contributions from the floor,  MSPs, industry representatives and business owners.

Different delegates will have different reflections from  the day– for my part, I felt there were three consistent themes.:

Common purpose

I opened our workshop by asking for a show of hands on the role of business in society, and how many people were looking at transitioning business models to implement social and environmental considerations. The almost universal view is that a purpose of business that runs beyond pure profit-making has already been widely adopted. Most businesses had made significant efforts to develop their employment practices, and/or consider how best to manage their environmental impact.

There seems to be a disconnect between perceptions and reality when it comes to business purpose Unfortunately, rare examples of poor business practice often get more attention than the many examples of businesses changing the world for the better. Most attendees of our workshop described how they were supporting fair work or a transition to a net zero carbon economy – for example, pioneering initiatives such as living hours, or adopting circular economy operating models. They wanted to be seen as part of the drive towards a fairer future and were proud of their ability to find new solutions big collective challenges. They strongly disliked the presumption that businesses are motivated only by profit, and the implication that the private sector is somehow less motivated by values.

There’s no suggestion that business is perfect. There are things that need change, such as long-term measurement of business success. But progress is being made – as Amanda Young from abrdn explained, constructive conversations between investors and investee companies around inclusion, safety, wellbeing, and the environment are now standard practice, but were far less accepted just a decade or two ago.

The simple fact is that 78% of jobs in Scotland are in the private sector and it’s responsible for most of our tax base – business success is a key element of our living standards and social prosperity.

Clarity

While businesses support the aims of the national strategy for economic strategy, and a wellbeing economy, they did talk about the challenges involved. One spoke about the huge volume of information from government about environmental impact and the net zero transition. As a small business with limited resources, they found this confusing and unhelpful. Businesses have different operating models, impacts, and are often at different stages in their transition. The universal challenges they face are around time, capability and managing finances and cashflow. What most businesses are looking for is good quality, tailored and trustworthy information and advice that is relevant for their own business.

There was also a feeling that headline government strategies and visions often weren’t easy to relate to for a small business operating in a tough environment. There was recognition of this in the cross-party panel discussion too – with one MSP remarking that ‘a strategy without a financial plan behind it is just fantasy’.  Of course, this certainty isn’t always possible – especially with recent volatility, and businesses do welcome efforts by government to share long-term policy certainty where they can. But by the same token, sometimes it’s appropriate for government to reflect on the appropriateness of a planned timeline or implementation plan, even on flagship policies.

Charity and social enterprise representatives raised the obvious challenges of short-term funding cycles, and it was clear this has a wider impact on how effectively leaders across sectors can plan and work together.

Collaboration

It felt to me like the key ask from attendees was less about the ‘why’ and the ‘what’ and mostly about the ‘how’.

Andrew Murphy spoke in his keynote about how ideally business and political engagement should be continuous. Another representative in our workshop explained how they’re “not looking for handouts or an opt-out, but they do want support, encouragement and an understanding of what they’re dealing with”. Feedback from many businesses was that they generally felt engagement was good at the start of a process but were not involved in discussions about implementation and approach –harming execution and delivery. Recent examples raised were the alcohol advertising proposals and deposit return scheme. Conversely, collaboration works when governments are less prescriptive and more enabling, when businesses are given peer-to-peer support, and when larger companies support smaller companies in an ecosystem. Several attendees, including panellist Jamie Grant, mentioned how they found the B-Corp process helpful, and Judith Cruickshank mentioned the work done with NatWest’s climate accelerator initiative.

Businesses felt that sometimes little understanding was shown of how different factors impact them and what this then means for the effectiveness of policy outcomes.  Managing short-term reaction to unexpected or poorly designed legislation is counter-productive to enabling businesses to achieve long-term transition that supports the big picture of national economic transformation.  

It might sound like some of the content of this article is negative. However, I left the event feeling uplifted by the desire to achieve our common vision and shared purpose.  When disagreement is not around end goals, but how to get there, then there’s grounds for optimism that by building trusted relationships, improving communication and enabling collaboration, we can find better ways to achieve the right outcome.

Events like this are part of this process. The meeting and reception the day before, between the First Minister and the Industry Leaders Group, was another good example of efforts being made to build relationships and create new channels of communication. Speaking as someone from ’the business side’ of this equation, I sympathise a lot with politicians their public service often does not get the appreciation it deserves. Policymaking is not easy! I’ve always valued their desire to listen and engage, and to support businesses to thrive and contribute to society. SFE is fortunate to have good relationships across parties that help us and our sector, and it’s clear we have a role to play in enabling effective collaboration.

It’s been a pleasure to work with Gareth Williams of SCDI, the Scottish Government and Scottish Parliament teams and all the other members of the working group. Thanks also to all MSPs who welcomed us in, engaged with the event and gave us such a great opportunity to focus on the shared ambitions we have, and how we can together improve outcomes for the communities, customers and constituents we work for.