Global SME success pathways – Interpreneur Report

September 24, 2024

The 2024 Interpreneur report from Kreston Global revealed vital insights into how small and medium enterprises (SMEs) can succeed globally, focusing on the UK as a business hub. In a recent article for the International Accounting Bulletin, Liza Robbins, Kreston Global’s chief executive, highlighted that the new Labour government under Keir Starmer has introduced several initiatives to drive growth. Still, uncertainty lingers over how these will affect international business prospects. Read the full article here, or read a summary down below.

Legislative shifts shaping business strategy

The government’s central goal is to stimulate economic growth by attracting investment into the UK and making the country more business-friendly. Key legislation, such as the Audit Reform and Corporate Governance Bill, will influence businesses by emphasising digital transformation and data management, even though it mainly targets larger corporations. Another significant proposal, the Employment Rights Bill, aims to enhance worker rights, introduce a new National Living Wage and place restrictions on dismissals and outsourcing, prompting businesses to reassess their cost management strategies.

Increasing role of AI

Robbins notes the increasing role of Artificial Intelligence (AI) in business and how the UK government plans to address its development. While there was no immediate introduction of an AI Bill, the anticipation of future legislation in this area is a call for businesses to prepare for potential changes. This future legislation is expected to regulate AI, further impacting businesses, and SMEs should be ready to adapt.

Tax policy is another concern, as UK growth projections suggest that the government may need to increase business taxes. For now, the Starmer government has avoided raising income tax, national insurance, or VAT. Still, the need for revenue will likely lead to future fiscal adjustments that could affect foreign investment decisions.

Opportunities amid economic volatility

According to the Interpreneur report, Western Europe remains a key region for business expansion, with the UK still attractive to international investors, despite its increasing divergence from its European neighbours. This divergence, however, could present unique growth opportunities for entrepreneurs, who prioritize growth opportunities over other factors such as government incentives or network security. This dynamic poses a challenge for the UK government, as it seeks to balance growth ambitions with the need for economic stability.

The report underscores that economic volatility, exacerbated by global events like the COVID-19 pandemic, Brexit, and inflation, remains a major concern for business leaders looking to expand into the UK. Robbins emphasises that SMEs must navigate these uncertainties, particularly the impact of Brexit on supply chains, which continues to affect trade with the EU.

Building confidence for business growth

The government’s efforts to mitigate fears of instability and build stronger ties with the EU, as seen in events like the European Political Community Summit, are aimed at boosting international confidence. These efforts demonstrate the UK’s commitment to maintaining strong international relations, which is crucial for business growth. However, Robbins concludes that the real test will come with the first Budget, where the government’s economic strategy will become clearer, and potential investors can better assess how the UK plans to attract and support business growth.

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