The Uk 's Financial Sector

807 Words2 Pages

The UK’s financial sector consists of two roles in the EU. Firstly, as a core for wholesale banking actions conducted by major European banks, and also a key port of entry for non-EU investment entering the Single Market (Miethe, J, & Pothier, D, 2016), If future negotiations in regards to Brexit lead to British financial institutions losing their financial passport rights, both of these roles risk being significantly reduced. The major concern within the financial services is pass-porting, and if the UK will be able to access the EU financial market.

3.3.1 Threats
This challenge is seen as a threat which could cause major damage to the UK economy so in order to minimise the risk, weaknesses need to be analysed and reduced. Financial Services are an essential part of the UK economy and the vote to leave the EU has a number of substantial consequences associated with financial services sector. As London is capital of Europe’s financial system with a surplus in financial services of £63bm in 2015, there is major concerns associated with Brexit (Irwin, 2016). Financial centres within London may relocate and this will have a negative effect of the economy. If the UK loses passport rights large financial organisations may decide to relocate (Protts, 2016). Pass-porting allows UK banks etc. the opportunity to operate in other EU countries, however Brexit may impact these rights which may result in London losing its title of finical capital. This is a challenge for managers and the organisation as the structure and systems within organisations will need to change.

3.3.2 Weaknesses
The structure of the organisation may change as offices or operations may have to move to a different location. This could affect interdepartmental coope...

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3.4.2 Weaknesses
Brexit may negatively impact on organisations through placing limits on cultural diversity through immigration restrictions. There will no longer be free movement of labour which will affect both manager’s and the organisation as they have less talented candidates to choose from. There may be skill gaps and oversupply of lower skilled workers that drags down wages. According to CBI, (2010) 45% of employers stated they find it difficult recruiting appropriate skilled staff.

Managers will have a much more culturally diverse workforce to deal with and this may cause problems for example if a company hires a disabled manager other employees could feel discriminated against as they have more qualifications. Low wage sectors will be affected as they depend on migrant labour, managers may now find it difficult to find staff to fill these roles.

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