2017 was another year of unprecedented change and as the new year gets underway, this trend looks set to continue for East Midlands’ businesses well into 2018, says financial and business advisers Grant Thornton UK.
To help local companies keep ahead of the game, Chris Frostwick, practice leader of Grant Thornton’s East Midlands’ office, picks out five key areas to look out for over the coming 12 months.
Gender Pay Gap Reporting
In 2016, male full-time employees in the UK were paid 9.4% more than their female counterparts, representing a clear improvement on the 17.4% reported in 1997. As part of government’s commitment to closing this gap further, new regulations are now in place requiring all organisations with 250 employees or more to publish their gender pay gap data by 4 April 2018.
With less than five months to go to the deadline and despite early reporting being encouraged, the majority of qualifying employers still haven’t filed their figures. Whilst there are no penalties as such for failing to comply, those organisations who do not accurately publish their information are at risk of reputational damage and being publicly ‘named and shamed’.
General Data Protection Regulation (GDPR)
From 25 May 2018, all organisations handling the personal data of individuals in the UK or EU will need to meet the new General Data Protection Regulation (GDPR), introduced to give people greater control over their personal data and how it is used.
The legislation aims to make organisations more accountable for all aspects of data protection from the collation of personal information to its disposal. Businesses must ensure they are ready to comply by the May deadline or they could face a hefty fine and once again, damage to their reputation.
2018 looks set to become the ‘Year of Social Mobility’. Inequality in society remains all too prevalent and more work must be done to create a level playing field where everyone has access to the same opportunities and support, regardless of background.
Employers have a crucial role to play and by looking at how recruitment, operational and community activities can be adapted, they can help to achieve this vision. Investing in social mobility is not only the right thing to do, it enables businesses to access an otherwise hidden pool of talent alongside diverse perspectives, so they can better meet the demands of the clients they serve.
Last year, Grant Thornton was recognised as the number one employer in the UK for its action to improve social mobility in the workplace, and our work in this field will continue throughout 2018.
Deal or no deal
With the final terms under which Britain will exit the EU still unclear and ongoing political instability, it’s unlikely the uncertainty which has dominated the business environment for so long will subside in the short term. Whatever the outcome, both challenges and opportunities will inevitably arise so it’s more important than ever for local firms to plan for each likely scenario.
Trading markets, processes, supply chains and workforces all need to be considered and it will be those businesses who have the foundations in place and flexibility to adapt, who come out as the clear winners.
Interest rates and inflation
November 2017 saw the first interest rate rise for over a decade with further small increases expected next year to help bring inflation back down to its 2% target from the current six year high of 3.1%.
Although borrowing would become more expensive, interest rates are still expected to remain historically low, encouraging businesses and consumers to borrow and spend more. Economic fluctuations will always produce winners and losers, adding to the uncertain landscape local businesses face.
Chris Frostwick concludes: “Despite a number of clear challenges looming on the horizon, the main message we are hearing from local businesses is one of positivity. There is a feeling that although there is much which is outside their immediate control, the majority are looking at what they can do to place themselves in the best position going forward. This resilience and willingness to adapt will be key to achieving future success.”
Grant Thornton’s East Midlands regional office in Leicester has 160 staff and provides business and financial advice to dynamic organisations in the East Midlands.