That makes it all the more important to make the case for a rational analysis of our relationship with Brussels. And as part of this analysis, it is vital that we understand what businesses of all sizes in the City and across the UK want for the future.
Of course, there is no single business view on the importance of EU membership or of access to the Single Market. For some hedge funds, private equity businesses and banks that do little trade in the EU, this issue may be of little significance. But for other major financial businesses that operate across the EU from a London headquarters, access to the Single Market is critical.
There is a similar divergence of views across other sectors and other parts of the country. But a recent Confederation of British Industry (CBI) survey provided a snapshot of what a broad range of businesses would favour if a referendum on the future membership of the European Union were held tomorrow.
This survey showed that 78 per cent of firms favour staying in the EU, including 77 per cent of small and medium-sized enterprises (SMEs), while 10 per cent believe it is in their interests for the UK to leave the EU (11 per cent of SMEs). This paints a clear picture when combined with separate research from the Institute of Directors, showing that 79 per cent of its members have a business link within the EU, and 60 per cent believe that access to the Single Market is “important” for their trade.
Of course, these results should not mask very real frustrations over our current relationship with the EU when it comes the decision-taking process. Reform is needed to address legitimate concerns over unduly prescriptive EU legislation, employment law, and slow progress in implementing the Single Market in services.
Thankfully, we have seen welcome signs of pragmatism from the EU on financial regulation – most recently with recognition for the need for flexibility when it comes to supervising Libor and other benchmarks. A one-size-fits-all approach would have been inappropriate in this area, especially given that significant reforms have already been put forward by British regulators following the Wheatley Review.
In any debate with 28 different voices there will be times when the UK, like other countries, does not get its way – as was evident with the bankers’ bonus cap. That does not, however, mean we should be defeatist. This relationship matters when it comes to creating jobs and growth.
Mark Boleat is policy chairman at the City of London Corporation. Next month Guildhall will host the first ever conference held in partnership by the Global Impact Investing Network and the City of London Corporation. Investors from across the world will come together to discuss and learn about the innovative practice of social and environmental impact investment. For more details on the event on October 10-11 or to register visit www.giininvestorforum.org