IoD press release 9 in 10 UK business leaders expect to be negatively affected by the Ukraine crisis
In its March poll of 689 business leaders, the Institute of Directors found only 11% agreed with the statement that the Ukraine crisis ‘won’t significantly impact my business’.
Whilst the direct effects, based on disruption to trading activities in the region, are expected to impact only 12% of businesses, the indirect effects mean that the vast majority will be impacted in some fashion:
- 71% expect to be impacted through higher energy prices
- 52% through higher prices of other global commodities
- 61% through its general impact on confidence and/or UK economic growth
- 41% through its impact on global financial markets
The survey also found that 8 in 10 directors believe that UK companies should completely stop conducting business in the Russian market or trading with Russian companies.
Kitty Ussher, Chief Economist at the Institute of Directors, said:
“The devastating human impact of this conflict is, rightly, at the forefront of all our minds and today’s data shows our members support our stance from the outset that ceasing business with Russia is the right thing to do, over and above any financial interest of individual firms.
“What we now realise, however, is the extent to which the whole of the UK economy is affected by the war through indirect channels as well. The primary mechanism is via higher energy prices closely followed by the general impact on confidence and through that the macroeconomic environment in the UK. Our members, who tend to be ambitious SMEs, also expect to be affected through their high exposure to other globally traded commodities such as wheat, oil and metals, that have also been affected by the conflict.
“All in all, around nine in ten business organisations in the UK expect to be affected in some way, whether it’s through higher costs, an uncertain operating environment, or simply management bandwidth as leadership teams replan their operations at speed in the light of a rapidly changing, uncertain and ultimately tragic situation.”
The IoD’s monthly Directors’ Economic Confidence Index found that business has experienced a dramatic collapse in confidence following the invasion of Ukraine.
Full survey results
689 respondents, conducted between 11th-28th March 2022
How do you expect the Ukraine crisis to impact on your business? Please tick all those which apply
Should UK companies continue to do business with Russia – either by conducting business in the Russian market or by trading with Russian companies?