Scottish National Investment Bank: review of performance 2026

Mandate and missions

30. The overarching mandate for the Bank is set out in its founding legislation, the Scottish National Investment Bank Act 2020. This states that the Bank’s vision is:

• To provide finance and act to catalyse private investment to achieve a step change in growth for the Scottish economy by powering innovation and accelerating the move to a net-zero emissions, high-tech, connected, globally competitive and inclusive economy.

31. Its main object is:

• Giving financial assistance to commercial activities for the purpose of promoting or sustaining economic development or employment in Scotland.

32. However the Act also requires Scottish Ministers to set strategic missions for the Bank, describing the broad socio-economic and environmental challenges that the Bank should seek to address through its investment activities – in other words, the Scottish Government’s overarching, long-term policy priorities for the Bank.

33. It is then for the Bank, operating independently of the Scottish Government, to interpret and operationalise these missions, and use them to guide its investment activities.

34. The missions set by Scottish Ministers in 2020 were as follows:

• Net zero: Address the climate crisis through growing a fair and sustainable economy by 2045.
• Innovation: Scale up innovation and technology for a more competitive and productive economy by 2040.
• Place: Transform communities by making them places where everyone thrives by 2040.

35. These missions are intentionally very broad, and somewhat different in nature. Taken together, they have given the Bank considerable practical room for manoeuvre in terms of the specific areas, and the types of companies and projects, on which to focus its attention and resources.

36. In the first phase of the Bank’s existence, this was undoubtedly helpful in allowing the Bank to respond flexibly to investment opportunities coming its way – recognising that there was a very high degree of interest in the Bank from the outset, and a correspondingly high volume of enquiries and requests for funding – while at the same time building the organisation, determining its operating model and investment strategy, and developing tailored approaches to each mission.

37. I also heard that the Bank’s status as an explicitly mission-led organisation was also helpful in recruiting and motivating committed staff to what was effectively a purpose-driven start-up, and in differentiating itself from other institutions in the marketplace.

38. However, although the breadth of the way in which the missions were expressed was clearly positive in many respects, it did present a challenge in establishing external understanding among potential investees and wider stakeholders over the Bank’s specific areas of priority interest. Not everyone I spoke to was fully clear about the Bank’s strategic focus within each of the missions, and the relative priority it attaches to each of them.

39. This is not necessarily all the Bank’s responsibility: but now that the Bank can draw on the learning from the first five years, there is scope for the Bank to do more to articulate its strategy, its priorities and its approach in this regard - both in its set-piece publications, such as its annual investment strategy, and in its ongoing communications activity.

40. For the first period of its existence, the Bank set itself the goal of achieving a broad split between the missions across its investment portfolio of 50 per cent net zero, 25 per cent innovation and 25 per cent place – whilst recognising that in practice some investments may speak to more than one mission.

41. I understand that at this point the split stands at about 49/20/31. The Bank is currently considering its goals for the next five years, in the light both of its on the-ground experience so far and of the evolution of the wider economic and policy environment within which it operates; and it will of course keep its desired balance under review on an ongoing basis as it goes forward.

42. In that context, it is striking to note how far the national and global context for the net zero mission has shifted since 2020, as a consequence both of fluidity in the UK policy landscape, and of wider geopolitical shifts. This has had a major impact on the investment climate around offshore wind in particular, and on the number of commercially viable investment propositions of scale in Scotland in which the Bank could invest.

43. The policy context for the innovation mission, meanwhile, has been made more complex by the publication of successive Scottish and UK Government strategies and policy statements on industrial policy, on specific sectors and subsectors, on innovation, and on support for business start-ups and scale ups by both governments and their relevant public bodies.

44. Finally, the Bank’s approach to the place mission has increasingly been shaped by the spotlight on weaknesses in Scotland’s housing market, and the priority the Scottish Government has given to addressing the housing emergency. Indeed, investment in housing constitutes the bulk of the Bank’s place activity; and I understand that the Scottish Government has committed to provide additional capital to the Bank, over and above the planned allocation, specifically to do more on housing between now and 2030.