I believe the below is the clearest explanation of the emergence of Speculative Freemasonry from the Operatives....
In December 1583, James I of England appointed William Schaw as principal Maister o' Wark (“Master of Works”) to the Crown of Scotland for life, responsible for all royal castles and palaces. Schaw, a loyal Catholic, replaced the Protestant Robert Drummond, most likely as a direct result of the Gowrie Regime. Around the time of Schaw’s installation as master, the 7th Lord Seton was sent as ambassador to France, accompanied by his son Alexander Seton and William Schaw, known to be friends due to their shared interest in architecture. Returning the following year, Schaw was intimately involved in building the Seton Collegiate Church and Seton Palace. George Seton remained in France, not liking the pro-Protestant turn of events in Scotland.
The First Schaw Statutes, written in December 1598, were rooted in the “Old Charges” of stonemasonry, typically describing the duties, charges and regulations of a mason’s lodge. However, many also included a prayer and description of the Seven Liberal Arts, followed by a romantic history of the operative craft. Schaw included additional material to describe a hierarchy of wardens, deacons and masters. Apprentices joining a guild would be bound to their masters for seven years. Within Freemasonry, an initiate symbolically rolls up his trouser leg to show that he is not bound with chain irons, and is coming to the lodge of his own free will and accord.
Schaw spent more time in Edinburgh than Glasgow and his earlier trip to France with Lord Seton had been funded by the town of Edinburgh, considering the kings lack of funds at the time. This loyalty, and the fact that his great friend, Alexander Seton, had now become Provost of Edinburgh, goes a long way to explaining why Schaw favoured the Operative Lodge of Edinburgh (“Mary’s Chapel Lodge No. 1”) over Mother Kilwinning Lodge No. 0 near Glasgow, in his Statutes. Mary’s Chapel Lodge is in possession of the oldest known operative masonic lodge records, dating back to July 1599, shortly before the publication of Schaw’s Second Statute.
In his Second Statute, Schaw attempted to make up to Kilwinning by declaring it the “head” lodge for the operative craft and giving it regional authority for west Scotland, whilst confirming all its previous practices. Interestingly the officials of the lodge were recommended to ensure that all fellows and apprentices "take trial of the art of memorie". Having placated operative lodges in the West of Scotland, Schaw now also encountered problems from the St. Clair Family. Over 100 years prior, William St. Clair, the builder of Rosslyn Chapel, had been a great employer of stonemasons, notably the Tironesian experts in gothic architecture. The St. Clair descendants thus felt they had some say in the matter of how operative masonic lodges should be run, even though the surviving male line of the family had fallen out of favour with the ruling elite of the time.
However, the Setons and St. Clairs were still close and Dunfermline Lodge was supported by both the St. Clairs and Alexander Seton, Earl of Dunfermline. Schaw now placated them as well, by confirming the role of the Lairds of Rosslyn as “patrons and protectors of the Craft”, in his St. Clair Statutes of 1600 and 1601. Schaw died in 1602 and his tomb inscription, written by his great friend Alexander Seton, begins as follows:
“This humble structure of stones covers a man of excellent skill, notable probity, singular integrity of life, adorned with the greatest of virtues – William Schaw, Master of the King's Works, President of the Sacred Ceremonies, and the Queen's Chamberlain.”
As well as having the oldest operative lodge minutes, Mary’s Chapel Lodge No. 1 also records the admission of Lord Alexander into the lodge in 1634. Was this Lord Seton? And did Schaw, Seton and Dickson introduce the Art of Memory into masonic ritual? It’s certainly a strong possibility. We thus know that speculative masonry must have emerged sometime between the 1599 operative minutes and the 1634 initiation of a Lord into the lodge, who clearly would not have been an operative stonemason.
Although baptised as a Roman Catholic, James I of England was brought up Presbyterian and, following the Union of the Crowns, he leaned towards Anglican practise. James had great trouble with both Protestants and Catholics in Scotland. Anglicanism seemed like a reasonable compromise. Speculative Freemasonry may have emerged from Scots Protestant and Anglican families, such as Hamilton and Murray, splitting from the traditional Templar / Catholic families of Seton and St. Clair. The rift between David Seton (Catholic aligned and allegedly the last Scots Templar) and Sandilands (Protestant and the last Prior of the Hospitallers before surrending the Order to the Catholic Queen at the time) is well documented. The current Queen is Church of England and still head of the Order, under new brand and management of course.
Certainly, Robery Moray (direct descendant of the Tullibardine Murrays) was a prominent Scots Mason and founder of the Royal College, whilst several Hamiltons and Murrays are later recorded in Scots Masonic minutes. HRH The Queen, Duke of Lancaster is also directly descended from the Tullibardine Murray's but that's another story...
The Protestant / Catholic debate was raging, around the same time that Rosicrucianism (hermetic mystery schools) and Francis Bacon was defining his New Atlantis and scientific empiricism. It must have been a fascinating time to be alive and equipped with a brain and a soul. As Freemasonry tried to provide a united platform for reconciling science with spirit, it may have tried to reconcile the many differing religious views, with a united reference to the “Great Architect of the Universe”.
Would Lords have associated with stone masons at this time? Very unlikely, considering the social structures prevailing. However, the operative lodges already had convenient meeting places and could have offered the perfect recluse for the gentry interested in discussing the emerging sciences, especially considering that stonemasons had always been open to the liberal arts, with maths and geometry being skills required for a master builder at the time.
James I would have had much insight into historical and emerging developments, being close to the major role-players at the time and having the benefit of the inheritance of Lord Sandiland’s Templar collection, via the Hospitallers. We will of course never know the exact course of events but the above is at least a reasonable guess, when considering the sequential timeline of events and interplay of the key characters at the time.