Since the UK voted to leave the EU by 52% or 48% in June 2016, there has been a spate of repercussions for the economy, business and wider society – all varying degrees of the good, the bad and the ugly.
Falls in GDP, productivity and wages
UK GDP growth has slowed, going from the highest rate of growth amongst the G7 countries before the Leave vote to the lowest now. Productivity metrics have slumped, the pound has depreciated and costs have increased.
While wages have risen since 2016, ‘real’ wages (taking into account inflation, cost of living etc) have not. Some quarters anticipated an increase in exports, although this failed to materialise (source: LSE’s Centre for Economic Performance).
And within the headhunting sector specifically, we’ve heard a few interesting post-Brexit tales.
Some senior British executives working in Europe have found themselves sent home due to uncertainty around their long-term future. Others have reported being made to feel so unwelcome that they decided to look for posts elsewhere.
But what about British, European and global companies who use Britain – primarily London, but also other UK towns and cities – as a base for European business?
“International perspectives will become even more valuable”
Well, there’s a lot to consider. One interesting outcome from the EU Leave vote was that between 2016 and 2018 the number of UK-born FTSE 100 CEOs dropped from 60% to 56%. There are more international Chairs and CFOs in UK-based FTSE 100 companies than ever before, with Brexit uncertainty seeming to have no impact on the upward trend. A coincidence or a shrewd survival tactic?
Diversity has been a key criteria for big business Boards for some time, with companies moving seeking to distance themselves from ‘pale, male and stale’ stereotypes. European and international perspectives will become an even more valuable aspect of that diversity framework when the UK leaves the EU.
And with new PM Boris Johnson using his first speech in the Commons to promise EU citizens “absolute certainty of the right to live and remain” in the UK, many top executives will feel reassured about their future in Britain.
Europe’s Got Talent?
Just as Johnson has appointed Michael Gove as Chancellor of the Duchy of Lancaster (in other words, ‘Chief Fixer’ and responsible for No Deal Brexit planning), CEOs will also be looking more widely for top talent to maximise growth and profit during the difficult economic forecast that could follow leaving the EU without a deal in October.
There’s always a need in business to look at your Board and identify skills and experience gaps, but Brexit will make this critical. We’re already asking our clients difficult questions: is your CFO able to forecast under extreme uncertainty? Is your COO considering all possible No Deal Brexit supply chain scenarios?
An Uncertain Future?
Of course, senior executives would do well to remember that uncertainty presents as many opportunities as it does problems. Businesses are constantly under pressure to prove their resilience – we must adapt to thrive and survive.
Johnson is making grand statements. “By 2050 it’s more than possible that the United Kingdom will be the greatest and most prosperous economy in Europe at the centre of a new network of trade deals which we have pioneered,” he declared in the Commons the day after he was announced PM.
Of course, Brexit will inevitably mean significant business and trade policy reform, and Government will consult businesses as part of that process. And it will be in the new Prime Minister’s interest to make Britain as hospitable a home for business as possible. Let’s hope he’s up to the challenge.
Thinking about whether your top team has the experience, agility or international perspective to navigate the uncertainty ahead?
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