Scotland on the cusp of establishing world’s first ethical finance hub
Scotland may be on the cusp of creating the world’s first ethical finance hub according to experts in the field led by the Islamic Finance Council UK (IFC) and leading Scottish law firm, Tods Murray.
The statement comes ahead of a meeting today at the Scottish Parliament between the financial services industry and the Scottish Government’s Cabinet Secretary for Finance John Swinney MSP. It also comes hot on the heels of last week’s announcement that Scotland will soon have the ability to issue its own bonds on the international money markets.
“We have seen the ethical finance debate gain real momentum in the last 12 months. We know that the financial services industry is fully behind the proposal and there is no doubt that Scotland is now well placed to develop the world’s first centre for the development and promotion of ethical finance, which could in turn stimulate the development of innovative financial products.”
Commenting further after last week’s bonds issue announcement, Graham added:
“With news that Scotland will shortly be able to issue its own bonds, this could offer a significant opportunity to tap into major funding sources in the Islamic world where we know there is already interest in investment in Scottish capital projects. This could present the mechanism to allow this to happen.”
Such a project would bring together key players from Government, financial services, academia and the third sector to facilitate both commercial investment and thought leadership, along with the practical systematic and structured R&D required for developing and testing ethics-based models of banking. The concept builds on Scotland’s proud and respected heritage in the banking sector, such as the pioneering development of savings banks and mutuals.
Speaking ahead of the meeting, Cabinet Secretary for Finance, John Swinney, said:
“Despite the challenges which continue to exist within the financial services sector in Scotland, the industry remains in a strong position and it is crucial that we continue to maintain its proud legacy and reputation.”
“It is essential that we seek out new opportunities to diversify our financial services industry, so that the industry can continue to prosper and grow.”
“Providers of ethical finance have the potential to position themselves as a viable alternative to mainstream institutions within the financial services sector in Scotland which will inevitably benefit consumers and the industry itself as increased competition drives up standards and promotes innovation.”
Omar Shaikh, Director at the Islamic Finance Council, urged the Scottish Government to make the hub a reality. He said:
“Scotland can lead the world and develop an industry which will generate significant new jobs and economic growth. We see Islamic finance as subset of ethical finance which has contributed significantly to attracting investment into the UK. Billions have been invested into London using Islamic finance and we have asked Scottish Government to formally investigate how Scotland can also benefit from such investment.”
“The ensuing financial crisis has highlighted the need for a more systemically stable and socially responsible banking and finance sector. Considering Scotland’s proud heritage, the Ethical Finance Hub can positively position Scotland at the forefront of this market should the Scottish Government make it happen.”
To discuss the possibilities and learn more about ethical finance, contact Graham Burnside by clicking here. You can also read more about Tods Murray’s leading part in the ethical finance debate below: