With the referendum on independence for Scotland not far away, the Business Continuity Institute (BCI) has published a paper to help organisations on both sides of the border consider what the impact of independence could be for them and provide links and resources that will help organisations further understand the debate.
Whether it is a new government being elected or an international treaty signed, political change happens all the time and this will invariably have an impact on organisations. Priorities, budgets and regulations all change, resulting in organisations having to rethink their strategies. If disruption can occur when something relatively routine happens, what could happen when there is an entire change of sovereignty?
The BCI remains neutral in this debate but highlights that, whatever the outcome, there will be change in Scotland that will require organisations to reconsider their business continuity plans and strategies. Some of the key findings of the paper include:
- The decision could significantly influence the conduct of business across the Anglo-Scottish border and organisations may have to adapt to a possible independence settlement.
- Policy divergence in key areas such as taxation, business regulation and labour laws is likely to significantly affect highly regulated professions such as the finance and banking industries. For other sectors, policy divergence may result in an increase in operational and logistics costs.
- A monetary union with rUK that allows an independent Scotland to use the pound sterling will keep transaction and borrowing costs to a minimum. However, this may come at the expense of setting independent Scottish monetary policy that may have effects on some businesses. Meanwhile, adopting a different currency for an independent Scotland carries costs so organisations need to have financial safeguards in either case.
- Both sides of the border enjoy interconnected infrastructure and this is not likely to change following independence. However, two sets of policies for critical infrastructure are likely to emerge due to inherent strategic differences of both countries and this may influence the operational terrain for businesses operating on both sides of the border.
- Differences in energy production/consumption may influence sourcing arrangements and cause variations in fuel and energy costs for sectors such as manufacturing, logistics and retail.
- An independent Scotland’s admittance to the EU is uncertain and the indefinite timescale of the accession process may introduce short-term uncertainty over the continued access to benefits provided by EU membership.
A change in the Anglo-Scottish relationship will carry far-reaching consequences to organisations and the way they operate across the border. Independence in itself carries potential opportunities and both Scotland and the rUK remain excellent markets with the highly interlinked trade between these countries not likely to change following independence. However, the change in their relationship will inevitably influence changes in business operations albeit to differing degrees. This is something that organisations must understand as they wait for the results of the independence referendum, and must plan for either way.
Lyndon Bird, Technical Director at the BCI, commented: “This is a big decision for the people of Scotland that could have far reaching consequences for organisations on both sides of the border and further beyond. Like with any major event however, looking ahead, establishing what the impact could be and making sure plans are in place to deal with these should allow any organisation to operate as normal during abnormal circumstances.”
Whilst the outcome of the vote remains uncertain, maintaining continuity amidst political change is a constant. The Scottish independence referendum is a unique event that may influence the conduct of business on both sides of the border. It is essential that organisations know what is at stake as their capacity to adapt will determine their viability regardless of independence or continued union.
To read the full report, click here.
Based in Caversham, United Kingdom, the Business Continuity Institute (BCI) was established in 1994 to promote the art and science of business continuity worldwide and to assist organizations in preparing for and surviving minor and large-scale man-made and natural disasters. The Institute enables members to obtain guidance and support from their fellow practitioners and offers professional training and certification programmes to disseminate and validate the highest standards of competence and ethics. It has circa 8,000 members in more than 100 countries, who are active in an estimated 3,000 organizations in private, public and third sectors.
For more information go to: www.thebci.org