UK referendum: Business leaders react to Leave vote

The UK’s vote to leave the European Union has shaken confidence in financial markets around the world and left major employers within the UK and EU uncertain of the repercussions.

This has been further hightened by huge political upheaval within the UK since the result was announced on Friday.

Business leaders and representatives have called for stong, stable government and reassurances that employers will still be able to recruit the people they need to.

Confederation of British Industry (CBI) director general Carolyn Fairbairn called for a period of calm and stable leadership from government – but this has been absent in the first few days.

“The British people’s vote to leave the EU is a momentous turning point in our history. The country has spoken and it’s for us all to listen,” she said.

“Many businesses will be concerned and need time to assess the implications. But they are used to dealing with challenge and change and we should be confident they will adapt.

“The urgent priority now is to reassure the markets. We need strong and calm leadership from the government, working with the Bank of England, to shore up confidence and stability in the economy.

“The choices we make over the coming months will affect generations to come. This is not a time for rushed decisions,” she added.

Institute of Directors (IoD) director general Simon Walker echoed this call for strong political leadership.

“While this may not have been the result that the majority of our members wanted, Britain has voted to leave the EU, and it is now imperative that our political leaders manage the transition as smoothly as possible. The weeks and months ahead are going to be a nervy time for business leaders, so they have to know that the government is focussed on maintaining stability while a new relationship with the EU is established,” he said.

“British businesses are resilient and, with their characteristic ingenuity, they will weather this storm. It is now beholden on politicians to negotiate a deal with European leaders which preserves the ability of British firms to trade easily with the remaining member states. Even once we have left, the EU will continue to be our biggest trading partner, and the first destination for many companies when they start to export.”

Walker added that it was imperative for the the government to immediately to guarantee the right to remain of EU citizens currently in the UK.

“Companies do not want to have to worry about losing valued staff,” he said.

Before the referendum, a survey of IoD members revealed that, despite concerns about the effect of the UK leaving the EU on trade and access to skills, businesses leaders saw potential improvements to employment regulations. Half of directors thought that the UK could be an economic success outside of the EU.

EEF (the manufacturers’ organisation) chief executive Terry Scuoler also urged for immediate reassurance and action from government “to stabilise the economy, reassure the markets and shore-up business confidence.

He said: “The process of leaving the union will take some time, and the government should not rush to instigate Article 50 and the formal exit process, while there is so much uncertainty. Ministers must think carefully about our negotiating position while setting out a clear roadmap for establishing a new deal with the EU which remains our biggest market and trading partner.

“We need a clear vision for a new relationship between the UK and the EU, but we must also avoid throwing the baby out with the bath water. In the complex task of unpicking the UK from EU regulation and legislation, the government must tread carefully, keeping if we can a trading relationship with the single market, avoiding dramatic overnight changes and not becoming bogged down to the detriment of making long-awaited and much-needed decisions on projects vital to our future economic prosperity.

“We must also ensure that the skilled workers we need are still encouraged and enabled  to live and work in the UK,” he added.

British Chambers of Commerce acting director general Adam Marshall echoed the calls for stability and clarity for politicians.

“In the wake of the electorate’s historic decision to leave the European Union, the immediate priorities for UK business are market stability and political clarity,” he said.

“Some business people will be pleased with the result, and others resigned to it. Yet all companies will expect swift, decisive, and coordinated action from the government and the Bank of England to stabilise markets if trading conditions or the availability of capital change dramatically.

“Firms across the UK want an immediate and unambiguous statement from the prime minister on next steps, along with a clear timeline for the UK’s exit from the European Union.

“Business will also want to see a detailed plan to support the economy during the coming transition period – as confidence, investment, hiring and growth would all be deeply affected by a prolonged period of uncertainty. If ever there were a time to ditch the straight-jacket of fiscal rules for investment in a better business infrastructure, this is it,” he added.

Marshall also noted businesses needed action to maintain economic stability, a timeline for exit, and answers to their many practical, real-world questions about doing business during and after this historic transition.

“Firms want help to get Britain back to business at a time of great uncertainty. The health of the economy must be the number one priority – not the Westminster political post-mortem,” he concluded.

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