Insights / 21 January 2020
Purpose Vital for Global Service Providers in 2020 by John Harris
2019 was another year of instability and uncertainty in the global markets – from trade wars between the US and China, to instability in the Middle East, unrest in Hong Kong and other Asian economies, and of course the impact of Brexit in Europe - and this has undoubtedly posed a challenge for firms in international financial centres (IFCs) around the world supporting global private and institutional capital flows.
IFCs have had issues of their own to deal with too – political scrutiny has led to the introduction of economic substance laws in the Crown Dependencies and some Overseas Territories, and the debate around beneficial ownership and public registers has continued to rumble on.
Against this backdrop, though, the trust, corporate and fund service provide sector has performed robustly, with IFCs continuing to attract high quality business – Jersey, where Crestbridge is headquartered, for instance, saw record levels of regulated funds business in 2019 with net asset values peaking at over £340bn.
Certainly from my own perspective, as I reflect on my first year as Chairman of Crestbridge, the firm has performed extremely well in a challenging climate - we have expanded into new markets, notably the US, whilst we have bolstered our proposition with a growing team in Bahrain, a stronger family office offering and larger office in Cayman, a fund administration licence and a larger office in Luxembourg and a new Management Company office as part of our London platform.
The firm has also made some key senior appointments, who have helped maintain a growth trajectory across our existing core business areas and who will play a pivotal role as we look to explore new opportunities in the months and years ahead.
My sense is that this positivity and optimism is reflective of the general mood across the service provider sector, but we should be under no illusions – 2020 will again be a testing year. As global operations, we will all of course be impacted as markets evolve, politics makes its mark and regulation adds to the complexity of what we all do.
Against that backdrop, as we look to the future, service providers need to look to continue to innovate and differentiate themselves in what is a competitive and challenging market.
A long-term strategy with a clear focus on growth objectives, global footprint and client needs is absolutely vital, but that needs to be matched by a joined-up approach to ‘purpose’ that is reflective both of clients’ aspirations and responsive to the needs of society and the communities we all operate in.
I firmly believe that it will be clarity around identity, purpose and direction at a Group level that will define the success of service providers and the success of clients in 2020 and beyond. In a sector that is growing and that is by nature multi-faceted, multi-divisional and multi-jurisdictional, that is a real challenge.
From our point of view, we continue to focus on our ongoing maturity as a Group by drawing on our independence as a business to establish a clear and shared direction of travel across our jurisdictions and across our business lines. We are quite clear that where we are headed as a firm is hugely dependent on maintaining a joined-up understanding of what we stand for and, looking into 2020, we are placing a significant focus on purpose, innovation and talent to achieve that.
These are challenging times for the service provider sector, but for those can respond positively to the needs of society and establish a clear joined-up purpose-driven vision, then the future is very bright indeed.