20 November 2022
The liminal space between the UK Government Autumn statement and the Supreme Court decision on Wednesday illuminates the power and potential of full fiscal autonomy, and how it might be in an independent Scotland. How does this sit with corporate wellbeing? Lucy Beattie takes you on a journey from Patagonia to the Highlands of Scotland and back again to Chile.
Project Chacabuco
Yvon Chouinard, founder of outdoor clothing company Patagonia, hit the headlines recently with his Project Chacabuco, named after a fishing spot in Chile. This somewhat enigmatic name was given to the succession plan that saw the founder of Patagonia donate the entire company stock and profits to help fight the climate crisis. “Earth is now our only shareholder”, stated Yvon Chouinard in a recent press release that explained his actions.
When I took on a family farming business based near Ullapool in my early twenties, I was idealistic and green in almost every sense of the word. I had no idea how to run a business, but I knew that ethical and environmental principles had to be at the heart of it. So I set out on a long journey of reinventing the family farm as a biodynamic organic veg box scheme with social housing properties, tourism and sheep farming on the side.
At the heart of the business were the people who lived and worked on the farm. One day, in the local library business planning section, I found Chouinard’s noteworthy book on business strategy Let my People go Surfing. Like Chouinard, I too, felt like a reluctant entrepreneur. The autobiography inspired me, and I applied a lot of it to my own situation to great effect.
Corporate wellbeing isn’t about a spa day
The concept of corporate wellbeing does not refer to team building or away days in a health spa, although that may be part of it. The concept of wellbeing within a business ensures that your activity promotes sustainable growth supported by the mental, physical, emotional and economic health of those who work in the organisation. Crucially, a business should be run legally and ethically, and part of that includes paying taxes.
Project Chacabuco does not allow the Chouinard family to receive any tax benefits; in fact, it is quite the opposite: they will have to pay £1.75million dollars in gifted shares. Westminster seems to be reluctant to take the same route, although the current Chancellor did extend the top rate of income tax down to include those earning over £125,000. However, thanks to devolution, Scotland has its own tax raising powers – which the BBC News recently framed as a “tax gap” – and will be able to take its own measures.
Re-framing the Scottish income “tax gap”
If you live in Scotland, you will not just notice the income tax gap. You will also notice other gaps that distinguish Scotland from the rest of the UK. Fee-free access to undergraduate education, free bus travel for all those aged 5–21 and over 60, free musical instrument tuition for pupils in schools, fully-funded early learning and childcare, and standard bursaries for nurses, midwives and paramedics are just a few examples of the “gaps” that exist between Scotland and the rest of the UK.
So how does this contribute to wellbeing? Indicators such as biodiversity, greenhouse gases, educational attainment, income inequality and young people’s participation are all used as measures to benchmark Scotland as a wellbeing economy in relation to other nations. Arguably, policy and practice feed into all these aspects of Scotland’s wellbeing economy. And this should be an important consideration for any business looking to locate in Scotland.
Nae Pasaran – Rolls Royce and the Lanarkshire connection
Back to Chile, in contrast to Chouinard, the despotic Pinochet regime of the 1970s saw Scottish workers at the East Kilbride Rolls Royce factory come together in solidarity when they downed tools and refused to repair and service engines for the Chilean air force Hawker Hunter military jets. Jets that were being used to oppress Chileans. This stance against the capitalist arms model brought about significant change. It saw corporate power obscured by grassroots-led ethical accountability, and in 2015 the Chilean Government bestowed the highest civilian honour for non-Chilean citizens to the men involved in this action.
At a community venue near the UWS Lanarkshire campus, where I now study, I met and chatted with pensioners living in Hamilton who previously worked for Rolls Royce. They are concerned about taxes, the cost-of-living crisis and the loss of jobs in the area. “Rolls Royce had seven factories in Lanarkshire in my day, now there is just one in Inchinnan, and they say that’s likely to close and go down the road to Derbyshire.”
The Scottish government should take a leaf out of Chouinard’s book
Individuals may see themselves paying a higher rate of tax in Scotland compared to the rest of the UK, but most feel content that the additional revenue supports targeted social and economic support for Scotland. There is one exception, however – corporation tax. This remains a matter devolved to the Westminster Government. Independence would go beyond “devo max”, or full fiscal autonomy, and arguably this would seem the best solution to bring corporations on board, to get them to put their money where their mouth is and take the risk, to be part of the reward, that supports a wellbeing economy in Scotland.
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