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IoD publishes wide-ranging survey of business views on EU

09 May 2016
IoD Flag pole outside 116 Pall Mall
  • Business leaders split 63-29 in favour of remain. 6 in 10 say access to the single market is important to their company, but three-quarters think EU needs reform to prevent economic decline.
  • Over half of company directors say Brexit would be a ‘significant’ challenge for them, but a similar proportion think the UK could ultimately be an economic success outside the EU.
  • No clear consensus among IoD members on the best UK-EU relationship in the event of Brexit.

The Institute of Directors is today publishing the findings of an extensive survey of 1,224 members on their views on the UK’s relationship with the European Union, conducted between 13-28th April.

Simon Walker, Director General of the Institute of Directors, reveals the findings of the survey:

“Companies don’t have a unanimous view on the referendum. However our survey shows business leaders more than 2 to 1 in favour of remain with the gap widening as the vote nears. IoD members have extensive business links across the European Union, importing and exporting, and employing EU citizens. They value access to the single market and the skills of workers from across the bloc. Increasingly, these economic arguments seem to be pointing company directors towards remaining an EU member.

“That said, IoD members are concerned about the way the EU operates, with three-quarters saying it is over focused on top-down policy solutions. If the EU and individual member states do not initiate reforms to make themselves more competitive, British business leaders think the future will be one of economic decline.

“Dealing with Brexit would be a challenge for most directors, who think it would have a negative impact on trade, research, and access to skills. However, more members than not think the UK could ultimately make an economic success of leaving the EU, in particular believing that it would have a positive effect on employment red tape.

“In the event of a vote to leave, IoD members are split on the best trading arrangement for the UK. Their favoured option is the Norwegian model, with access to the single market, but still being subject to EU regulations, and allowing free movement of labour. A looser relationship, falling back on our membership of the World Trade Organisation, was also a popular choice.

“It is hard to forecast the exact future shape of a post-Brexit deal, and much would depend on the attitude of the remaining EU members. There are grounds for concern here: companies believe the rest of the EU would react mostly negatively, rather than positively, to Britain at the negotiating table.”

Survey results

The IoD is not campaigning in the EU referendum, and the publication of this data is not intended to promote any particular outcome.  

Voting Intention

When IoD members were asked how they would vote in February, immediately following the Prime Minister’s reform deal, 60% said they intended to stay in the EU, against 31% who planned to vote to leave. By the end of April, the figures had moved to 63% against 29%.

Voting intention

April

February*

For the UK to remain as a member of the European Union

63%

60%

For the UK to leave the European Union

29%

31%

Don’t know

8%

10%

*February survey of 849 members conducted 21-22 February. Numbers do not sum to 100 due to rounding.

Business views on the EU

Over four-fifths of IoD members have some business link with the EU, including trading with other countries in the bloc, having employees from the EU, or being part of broader supply chain. Nearly 6 in 10 say that continuing access to the single market is important to their organisation, but there is considerable dissatisfaction the current management of union, and its lack of economic competitiveness.

What business links, if any, does your (primary) organisation have with countries within the EU?


Export goods to EU country/countries

21%

Export services to EU country/countries

42%

Import goods from EU country/countries

25%

Import services from EU country/countries

18%

Employ individuals from other EU country/countries

39%

Subsidiary office/operation and/or joint venture in other EU country/countries

21%

Supply to business(es) which do trade in/with the EU

34%

In receipt of EU funding

12%

Other (please specify)

6%

My business has no links with the EU

17%

Don't know

0%


Continued access to the Single Market is important to my organisation


Strongly disagree

9%

Tend to disagree

11%

Neither agree nor disagree

22%

Tend to agree

25%

Strongly agree

33%

Don't know

1%

 

AnunreformedEU is on a path of economic decline


Strongly disagree

3%

Tend to disagree

10%

Neither agree nor disagree

12%

Tend to agree

37%

Strongly agree

37%

Don't know

1%

 

From my organisation’s perspective, the benefits of the UK remaining a full member of the EU outweigh the negatives


Strongly disagree

16%

Tend to disagree

13%

Neither agree nor disagree

12%

Tend to agree

21%

Strongly agree

37%

Don't know

2%

 

The EU is too focused on internal debates and trying to impose top-down solutions


Strongly disagree

5%

Tend to disagree

8%

Neither agree nor disagree

11%

Tend to agree

32%

Strongly agree

43%

Don't know

1%

Effect of Brexit

Directors think trade, research and innovation and access to skilled migrants may suffer as a result of Brexit, and there are fears over what it might do the value of the pound. However, a majority of business still feel the UK could be a success outside the EU. 

How significant or insignificant a challenge would British withdrawal from the EU be for your primary organisation?


A very significant challenge

19%

Quite significant

32%

Not very significant

29%

Not significant at all

18%

Don’t know

2%

 

The UK could make an economic success of leaving the EU


Strongly disagree

11%

Tend to disagree

23%

Neither agree nor disagree

14%

Tend to agree

22%

Strongly agree

28%

Don't know

2%


Were the pound to significantly depreciate after a vote to leave the EU, what impact would this have on your business?


Very positive impact

7%

Slightly positive impact

21%

Slightly negative impact

31%

Very negative impact

18%

No impact

19%

Don’t know

4%

What impact you think Brexit would have on laws and regulations in the following areas:

Trade


Positive impact

21%

Negative impact

53%

No impact

18%

Don't know

7%


Social/employment legislation


Positive impact

46%

Negative impact

26%

No impact

21%

Don't know

7%


Research and Innovation


Positive impact

19%

Negative impact

38%

No impact

32%

Don't know

10%


Access to skilled migrants


Positive impact

12%

Negative impact

49%

No impact

33%

Don't know

6%

Post-Brexit relationship with EU

There is no definitive preference for a trade deal with the EU in the event of Brexit, and any UK-EU deal would be subject to negotiation. Those negotiations may be made harder, in the opinion of IoD members, by other EU states reacting negatively following a British vote to leave.




If the UK were to vote to leave, what do you think the most optimal arrangement would be in place of full EU membership?












Joining the European Economic Area (like Norway and Iceland)






36%






Rely on agreements under UK membership of the World Trade Organisation (no specific UK-EU agreement)






31%






Join Customs Union (like Turkey)






6%






Other






11%






Don’t know






17%





 




How do you believe the other European member states would react to the UK voting to leave the EU?












Positively






19%






A mixture of positively and negatively






45%






Negatively






34%






Don’t know






2%


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