parliament, passports & pragmatists: march 2017 the ...€¦ · risk hr compliance front office...

The Human Capital Specialists

March 2017

Parliament, Passports & Pragmatists:

March 2017 - The Leathwaite

Brexit Senior Talent Mobility

Survey

The Human Capital Specialists | www.leathwaite.com

Parliament, Passports & Pragmatists

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Executive Summary

With the pending activation of Article 50 due at the end of March 2017, Leathwaite polled in

excess of 300 senior London-based executives to better understand current sentiment towards

relocation as a result of Brexit-driven changes to their firms’ geographical footprint.

These individuals include CFOs, CROs, CHROs and COOs as well as other senior business

leaders.

Core findings can be characterised as follows:

• 76.8% of respondents feel that their role is “unlikely” or “very unlikely” to relocate as a result

of Brexit.

• Technology professionals feel their roles are most likely to be affected by Brexit via

relocation, with 25% of technology professionals polled of the belief that their roles are

“almost certain” to be relocated outside the UK.

• Seniority appears to play a part in current sentiment, with 65% of those at Executive

Management / Managing Director (MD) level polled, of the belief that their roles are

“extremely unlikely” to be relocated.

• Commuting from the UK to mainland Europe appears to be less favourable, with 19%

indicating that they would do this, should, their role be relocated.

• Amsterdam, followed by Dublin, are the destinations of preference for those likely to relocate,

with media favourites Frankfurt, Luxembourg and Paris lagging.

• The social aspects of a city and overall quality of life are the most important criteria within a

relocation, with quality of schooling surprisingly ranked 6th of six criteria.

• Perhaps surprisingly for some, 28% of those polled feel that the net effect of Brexit on UK

Financial Services would be positive. 53.5% of senior executives believe that Brexit will have a

negative impact on the UK financial services industry.



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Survey demographics

1. “Please outline your current functional employee grade:”

2. “Please outline your current functional domain:”

Executive Management / MD

Senior Management / Dir

Middle Management / VP

Other (incl. NED)

Finance

Risk

Compliance

Technology

Middle Management / VP and above:

• On the basis that more senior specialist and leadership

roles contribute proportionately higher value-add to

organisational performance, this was the focus of our

study.

Operations

HR

Front Office

Other (incl.

Cross-functional cross-section:

• To gain a true aggregation of current sentiment, a

cross-section of people within different functional

domains was polled.

• This included those that generate, support and control

the revenues created by these organisations, in the UK.



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Survey findings - likelihood of relocation?

3. "Based on information internal and external to your company today, what likelihood do you

attribute to your job being relocated outside of the UK in the next 12-24 months?"

Almost certain

Extremely likely

Likely

Unlikely

Very unlikely

Heads in the sand, or faith in the future?

• A resounding majority of respondents (76.8%) stated that their role is unlikely or very unlikely to

relocate as a result of Brexit.

• 100% of executives working within Finance or Operations confirmed that their roles were ‘unlikely’

or ‘very unlikely’ to relocate (compared to 76.8% from the overall response).

• 25% of executives within Technology believed that their roles were ‘almost certain’ to be relocated

(over 3 times the overall figure).

• 65% of Executive Management / MD grade stated that their roles were ‘very unlikely’ to relocate.

• 34% of Middle Management / VP grade felt that their roles were ‘almost certain’ or ‘extremely likely’

to be relocated.



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Survey findings - likelihood of relocation?

4. "If informed that your role was being relocated outside of the UK, what would your most

likely course of action be?"

Relocate with role (including family)

Commute from the UK

Start looking for another UK based job

Should I stay or should I go? Commuting the last resort

• 40% polled would relocate if their role was being moved elsewhere, with just 19% of respondents

seeing commuting as a viable option.

• However, willingness / ability to commute from the UK increased to 29% of those within Executive

Management.

• Furthermore, of those within Middle Management, 50% have already commenced their search for a

new role in the UK.

• In addition, the same proportion (50%) of those executives within Compliance and Operations

highlighted that they have also started seeking a new role within the UK.



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Survey findings - which cities are most attractive?

5. "Rank the following EU cities in order of attractiveness to you personally:”

Going Dutch

• Whilst much of the pre-Brexit geographical punditry has cited Frankfurt and Paris as the likely

beneficiaries of the industrial dispersion, Amsterdam has received far less attention.

• However, in terms of attractiveness, it clearly strikes a chord with those polled, with media

favourites Paris, Frankfurt and Luxembourg in 3rd, 4th and 6th places, respectively.



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Survey findings - which cities are most attractive?

6. "If you were considering relocation, please rank the following in order of priority to you:”

Lifestyle & Language come first

• Underpinning the Amsterdam ranking and perhaps proving that the majority of those employed

“work to live” rather than vice-versa, Quality of Life and Commonality of Language are cited as

paramount in relocation considerations.

• Whilst the effective tax rate and quality of schooling are very often sticking points in a relocation

negotiation, the data suggests these are very much “hygiene factors” rather than critical ones in the

relocation thought process.



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Survey findings - impact on UK FS

7. "What do you anticipate to be the net effect of Brexit on UK financial services?"

Positive

Negative

Unsure

Uncertainty with a hint of optimism

• Overall, 53.5% of senior executives believe that Brexit will have a negative impact on UK business.

• 75% of those executives within Operations stated that they thought Brexit would have a positive

impact on UK business.



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Additional comments

8. “Please add any additional comments that you feel may be relevant:”

The subject of Brexit has caused much debate since early 2016 and even now there is still not a

clear consensus with regards to whether the UK will be better off outside of the single market.

To close our survey we gave the respondents the option of providing additional comments or

statements, some of which we have included below:

• “EMEA's primary financial centre will remain as London without any doubt. European

governments need the City and so it will continue to thrive.

• “Brexit will require the UK to focus beyond the EU, which will be net beneficial for London as a

global financial centre in the long-term. Any short-medium term negative impacts are

worthwhile.”

• “The opportunity created by President Trump will offer UK the ideal 'bridging' between USA and

EU.”

• “My feeling is that the UK needs to be part of a broader community; Brexit damages this as it

takes us away from that and because of the message it sends to our partners.”

• “For Financial Services: Capital Markets sales, I would expect to see most EU sales teams + EU

regulatory/governance support lose a minimum of 50% of staff to EU locations.”

• “Hard Brexit will be disastrous in every segment.”

• “People need to start planning now for the immense changes that will come.”

• “Nobody will know what will happen until Brexit completes. Analysts constantly get things

wrong.”

• “There will be a flurry of activity and opportunity as financial services in London and Europe

transform and adapt to the emerging landscape. Banking reform has already forced banks to

align themselves to jurisdictions where they operate.”

• “Our company is not expecting to relocate any roles outside of the UK at this point.”



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Conclusion

Sentiment is naturally changeable, and doubtless, asking the same set of questions to the same

group of people in three, six or nine months’ time would not yield identical results.

This study was designed to give our clients some insight into the current thinking within senior

Human Capital across a broad range of sectors and functions.

At the time of writing it appears that UK-based executives have not resigned themselves to the

notion that we are witnessing the death-knell of the UK as a business centre of prominence,

with just 23% of the belief that their role is going to be re-housed outside the UK. Equally, just

under 30% of those polled, believe that Brexit will actually be positive for UK business. Whether

this is driven by protectionism, hope or fact-based prediction is unclear, but warrants

observation over time as Article 50 plays out.

On the topic of geography, the attractiveness of Amsterdam may surprise some, yet when

coupled with underlying motivations around quality of life and commonality of English, it is

more understandable. The image problems associated with Luxembourg and Frankfurt are

illustrated again in the study, as their attractiveness to executives lags the market fundamentals

which make them so often cited by the media as viable.

James Rust | Partner

[email protected]

tel: +44 207 151 5111

Leathwaite

Points of contact

Should you wish for a follow up discussion on this article or how

Leathwaite may be able to assist you, please contact:

Leathwaite is a Human Capital Specialist offering

business intelligence, executive interim solutions,

executive search services and management

consulting to a global client base, with market

knowledge and a worldwide network that are

held in high regard by our clients.

Possessing established offices within four key

global financial centres, Leathwaite is ideally

placed to provide insight on the global talent

landscape:

London: +44 207 151 5151

New York: +1 646 461 9100

Hong Kong: +852 3152 2463

Zürich: +41 44 214 6640

Chris Rowe | Director

[email protected]

tel: +41 44 214 6642

Kevin Matthews | Marketing

[email protected]

tel: +44 207 151 5127

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