A central plank of the reforms focuses on retail investment so that more UK savers are able to channel capital into UK business rather than leaving funds in low yield cash accounts. However, there were other aspects that will be of interest to corporate treasurers.
These include confirmation of a shake-up in retail bond issuance rules and changes to IPO and listing approval regime that will speed up timelines and ease regulatory burdens.
“Given the well-publicised concerns from the City on financial services policy, it is unsurprising there is a strong focus on reducing the regulatory burden on financial firms and on enhancing the continued competitiveness of the UK as a place to do business,” Annette Spencer, chief executive of the Association of Corporate Treasurers, said.
“And as the professional association for corporate treasury, we are pleased the chancellor reaffirmed that skills and access to talent are one of the five central pillars of the Financial Services Growth and Competitiveness Strategy,” she said.
... we are pleased the chancellor reaffirmed that skills and access to talent are one of the five central pillars of the Financial Services Growth and Competitiveness Strategy
Spencer welcomed the establishment of a new Listings Taskforce to support companies to list and grow in the UK and was optimistic that a dedicated Office of Investment: Financial Services – a ‘concierge’ service for attracting incoming business – would benefit corporate treasury centres as well as financial firms. “However, more could be done to alleviate the burden of day-to-day red tape on corporates, for example by reducing the disproportionate and repetitive ‘Know Your Customer’ requirements,” she said.
She added she was encouraged that some of the associated proposals, such as digitisation initiatives, structural reforms to the payments system and the easing of some capital requirements for banks, should allow money to move around the economy more efficiently. In her speech, the chancellor said: "The PRA and FCA are launching a scale-up unit to support innovative firms to grow in the UK, including in our world-leading payments system, and I will drive forward developments in blockchain technology, including tokenised securities and stablecoins, and an ambitious design for a new digital gilt instrument, so that UK financial services can be at the forefront of digital asset innovation."
According to Edelman Global Advisory, with reforms making retail accessible corporate bonds more practical, corporate treasurers may increasingly consider issuing retail-orientated debt instruments. Such changes could widen the investor base beyond institutional channels, offering potentially lower cost and greater flexibility in maturities and coupons.
Similarly, the faster IPO and listing approval regime, coupled with retail inclusion, should make equity and convertible issuance more attractive and efficiently executed, an area that will be ‘crucial’ when seeking timely capital for expansion or M&A, Edelman added.
However, according to law firm Farrer & Co, offering securities to retail investors imposes heightened regulatory oversight, particularly under prospectus regulation and consumer protection frameworks. While reforms aim to streamline rules, treasurers will need to coordinate closely with legal, communications, and investor relations teams to ensure compliance simplicity and clarity in retail disclosures, the firm warned.
The chancellor also revealed her approached towards sustainable finance, saying that she would not be pursuing a green taxonomy, but instead, she would work with regulators through the Transition Finance Council “to capitalise on the £200bn opportunity of the global transition to net zero”.
Spencer called on the government to ensure that other changes, such as the possibility of tax changes in the upcoming Autumn Budget, do not undo these reforms. “Whilst a healthy financial sector is a necessary precondition for growth, it is not in itself sufficient to give businesses in the ‘real economy’ the clarity, stability and opportunities needed to invest with confidence, she said. “More will need to be done to implement the other strands of the government’s industrial policy and create a joined-up approach.”
Philip Smith is editor of The Treasurer