Fairness and equality can define London's post-Covid economy

London business leaders have set their sights on rebuilding a fairer, greener and more inclusive economy in the wake of the Covid-19 pandemic – despite eight out of 10 firms in the capital experiencing an impact on output this year.

The CBI London Business Survey – run in partnership with UCL and Travers Smith, and in field prior to the second lockdown – draws together the views of nearly 200 of the capital’s business leaders, and covers topics including Brexit, Covid-19, sustainability and equality.

Its findings reveal just how deeply coronavirus has bitten into London’s economy in 2020 – and how much uncertainty remains within many businesses' prospects for recovery.

However, the survey also gives grounds for longer-term optimism, including a clear commitment from businesses to bounce back with a focus on innovation, employee wellbeing, inclusivity, and pushing London towards its net-zero ambitions.

Key survey findings include:

Brexit

• Almost one third of respondents (32%) said they were unprepared for the impact of a possible no-deal Brexit – and 58% said Covid-19 had impeded their Brexit preparedness.
• A trade deal with the EU, including comprehensive services coverage, was a priority for London’s recovery with more firms (72%) than any other factor.

Covid

• Four out of five respondents (80%) said their output had been impacted by the pandemic. 68% had yet to see trade return to normal (even before the second national lockdown) and 34% expected to still be operating below normal levels in a year.
• Companies operating in arts, entertainment and recreation face a tough outlook. 94% of respondents from this sector have yet to see a recovery, and three quarters (75%) expect their business to still be suffering in 12 months’ time.

Priorities

• Investing in innovation and technology (55%), supporting employees’ mental health and wellbeing (53%) and supporting new ways of working (51%) were immediate priorities for most respondents.
• In the longer-term, improving diversity and inclusion (58%), developing or enhancing sustainability and net-zero strategies (53%) and supporting social mobility (45%) were the most common goals.

This year’s survey included a special focus on diversity and inclusion, painting a picture of a capital city with an awareness of the importance of fairness – and critically a determination to improve further.

Only one in nine (12%) respondents said their company has not implemented a diversity and inclusivity strategy, and only one third (36%) has no employee networks. More than half (53%) pinpointed an area of diversity where they wanted to see improvement from their company, but felt they needed more support.

81% of London business leaders believe the capital’s firms could do more to reduce inequality in society. However, companies were clear on the route towards implementing this change, with 61% stating they believe government and business should work in equal partnership to reduce inequality across society.

Jordan Cummins, CBI London Head of Policy, said:

“This has been a year like no other for London’s businesses. Even before the second lockdown, the pandemic has dampened demand and restricted operations. With firms also needing to meet the challenges of Brexit preparedness, the resilience and adaptability witnessed amid this adversity has been remarkable.

“While the economy is not out of the woods yet, the London Business Survey positively notes how businesses’ future focus extends beyond just the balance sheet.

“In short, it’s not just about getting things going again; it’s about capitalising on this unique opportunity to rethink how London operates, who for, and to form a new-look business landscape which spreads opportunity more widely."

Kathleen Russ, Travers Smith Senior Partner, said:

“Diversity and inclusion have long-been priorities for Travers Smith. It is clear from the findings of this survey that there is a real desire from businesses to develop fairer and more diverse communities accounting for everyone’s needs.

“Tackling systemic inequalities and addressing the challenges facing under-represented and minority groups can feel like a monumental task. However, by working in partnership, the business community can take meaningful action towards creating a truly diverse and inclusive society.

“If we are able to do this, we will be invigorated by the huge potential of untapped talent across London and the innovation, creativity and profitability that comes with it."

Siobhan Morris, UCL Head of Programmes, Grand Challenge of Justice & Equality, said:

“Despite the immense challenges businesses have faced this year, the findings of the survey clearly demonstrate that the business community views tackling inequality in society as a key priority and of upmost importance as we look to ‘build forward better’.

“To do so, and effect change in tackling structural inequalities, requires working in partnership and forming alliances across all sectors of society.

“To ensure progress, it is critical that inclusive interventions are underpinned by intersectional analysis of data and that policies take into account the complexity and lived experience of inequalities. With such an approach, steps can be taken towards a fairer, more inclusive society.”