Get all your news in one place.
100’s of premium titles.
One app.
Start reading
Insider UK
Insider UK
Peter A Walker

Report calls for 'reset' of Scottish National Investment Bank

Ross Brown, professor in entrepreneurship and small business finance at the University of St Andrews' School of Management has called for a full review of the Scottish National Investment Bank's (SNIB) operations.

In a new paper, released today by non-partisan think tank Reform Scotland, he lauds the concept of SNIB, but finds that more than a year after launch, its strategy, operation and impact have only had "a very modest impact".

Among the report's findings, Brown argues that the Scottish Government’s broad mission for SNIB has unintentionally prevented the company-specific investments it needed to make.

It points out that only seven companies have received funding so far, creating "a very limited economic impact".

The paper also suggested that the government should consider channeling resources to SNIB from "poorly performing organisations such as Scottish Enterprise".

Brown commented: "SNIB looks unfocused and ill-conceived, and this vagueness has created an unhelpful mission-creep.

"It is not an effective strategy for a publicly-owned bank, particularly given the very high levels of remuneration being awarded to the senior management team.

"Most importantly, SNIB’s strategic deficiency is reflected in the very small number of projects currently being funded by the bank, which in turn is likely to lead to a very modest economic impact in the short to medium term."

He continued that if Scotland is to become a genuinely entrepreneurial nation, public policy in Scotland will have to become much bolder than at present. "To do this, the Scottish Government needs to hit the reset button on SNIB."

Brown added: "The bank needs a clearer delineation of its core strategy and customer base - fundamentally, the Scottish Government has to decide if the bank is designed to help develop the green infrastructure of the Scottish economy, or to propel business growth in SMEs in Scotland."

Chris Deerin, director of Reform Scotland, said he welcomed the creation of SNIB and continues to believe it is a commendable and important project.

"Its early months have not been trouble-free, but this is often the case with start-ups, and in our experience it has an excellent board and a strong executive team.

"It is exactly the kind of big, ambitious policy experiment that Holyrood should be embarking on, and we’d like to see similar ambition and risk-taking in other areas of government activity."

He added: "We see no reason why SNIB should not be a long-term success - and we hope this paper, in its spirit of constructive criticism, can play a small part in helping it towards that happy outcome."

Sarah Roughead, interim chief executive at SNIB, responded: "I am immensely proud of what the bank has achieved since launch in November 2020.

"During this period, the bank has invested in 16 projects and businesses across the Scottish economy, committing £206.9m and leveraging over £450m of additional private funding.

"The bank has invested across its three missions, delivering direct investment from £1m to £30m and with considerable progress being made with innovative and scaling businesses.

"The Bank is committed to working with partners, co-investors and other stakeholders to increase its impact and become a cornerstone institution in the Scottish investment landscape."

Don't miss the latest headlines with our twice-daily newsletter - sign up here for free.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.