The head of the City broker FinnCap has said Brexit has been a boost to the Square Mile as it has allowed regulators to ditch EU red tape. 

Sam Smith, chief executive of the London-listed business, said more money is going into UK growth companies than ever before and the City is working “very well”, despite warnings that it would lose business and jobs to the Continent following Britain’s break with Brussels. 

“To me, Brexit has not been anything other than quite positive … we are seeing signs that actually the regulatory regime could be changed in a positive way post-Brexit to really make this ecosystem fly,” she said.

The comments came as new research from EY found that fears of a mass exodus of City workers failed to materialise as the flow of bankers and traders moving to the EU went into reverse this year.

Hundreds of thousands of jobs were said to be at risk if the UK voted to leave. However, the exodus has been far lower than expected with fewer than 10,000 workers thought to have relocated.  

Separately, the City watchdog implemented a set of sweeping reforms of London’s listing rules in December as regulators seek to make the City more attractive to fast-growing firms.

As part of the overhaul, the Financial Conduct Authority slashed free float requirements for listed companies in a bid to lure a new generation of start-ups to the London Stock Exchange.

It also permitted firms with dual-class share structures to claim places in the leading share indices and draw on a wider pool of investors including tracker funds.

Ms Smith said: “We have had a great funding environment, there is lots of investment coming into the UK, there is money to back startups and scale up businesses. And that’s continued to come from overseas, which has gotten much better since Brexit.”

Meanwhile, in a sign that further reforms are to come, Andrew Bailey, the governor of the Bank of England, recently criticised EU-era red tape in the insurance market, arguing that rules requiring insurers to hold vast sums of money in ultra-low risk assets have put policyholders at risk.

Interview: Sam Smith

Sam Smith, the boss of FinnCap and the City’s first female stockbroking chief, is on something of a crusade to make the Square Mile a more desirable place to work.

Asked if firms are getting better at prioritising the mental health of their employees, she cautiously says they are, but then hesitates: “It’s still pretty bad, to be honest.”

The 47-year-old cites examples at her own firm, which she founded in 2007, of senior managers not appreciating when junior staff were on holiday and continuing to load them with tasks.

“That’s an easy thing to fix,” Smith says. “If you’re culturally not there and a senior person is constantly loading work on a junior and not caring if they’re on holiday or not, you’ve got a problem.”

Broker FinnCap recently made headlines for announcing an “unlimited holiday” policy for its 155 employees, including investment bankers and salespeople.

FinnCap will require its staff to take a minimum of at least four weeks off a year and two or three days every three months.

While the policy technically has no upper limit, Smith says bosses have guided that staff should take around six weeks off each year, with its internal HR portal allowing for 35 days leave without any need for extra sign off.

It is a bid to prevent staff burnout, which Smith says became a significant problem for the firm during 2021’s January lockdown.

“The lockdown last January was a really, really bad one for people. Some just didn’t have it in them to really keep going.”

However, similar “unlimited vacation” policies have proven to be controversial, in many cases resulting in staff taking fewer days off.

CharlieHR, a London-based software company, for instance, scrapped its unlimited holiday policy after several years, saying some employees took less leave than before.

Smith says her firm’s HR department will provide monthly lists showing managers how many days staff have booked off. As chief executive, she will then be sent a “priority list” of those who have not scheduled in the required days off.

“If it means me having to call them and saying you need to book it in, I’ll do it,” she says. “It has to be led by the top.”