Isle of Man e-privateclient report 2019

By Michael Crowe, CEO, Finance Isle of Man

As we approach the end of the year, industry pundits are looking into crystal balls to predict what is in store for the global financial services industry in 2020. From new banking opportunities, to regulations and from blockchain to increasing consolidation, financial services businesses will be confronted with various challenges and opportunities. As an industry with many nuances, niches and moving parts, it is accustomed to change, but it will now need to adapt to some of the biggest shifts it has seen in decades. Below, we look at some of the trends and themes which will continue to dominate the industry’ agenda next year.

Diversity and culture

It is no secret that conversations around the importance of diversity and positive company culture have reached a zeitgeist moment. What were perceived as ‘nice-to-have’ a few years ago, have now become commercial imperatives for financial services firms. In fact, senior regulators globally have emphasised the necessity of establishing the right culture within financial services firms.

According to a survey by the Financial Times, women account for more than half of the overall workforce, across 50 of the largest financial services organisations in the world. But, more alarmingly the same report said only 25% of the ‘senior roles’ across the same sector were filled by women.

The last census carried out on the Island in 2016 showed women across the finance sector were 55% of the total workforce, which broadly speaking is in line with the rest of the world. Where things begin to become more interesting is when we dive deeper into the figures to see how much of the 55% of roles, occupied by women,

Of all the women employed in finance roles on the Island, approximately 45% were employed in a senior role in 2016, which is much higher than the global average of 25%.

The Isle of Man is an international financial centre with a vibrant culture which fosters diversity and equal opportunities. There are various local trade bodies which promote excellence within the sector and networking opportunities. The Island also has partnerships with international industry organisations, such as the London Institute of Banking and Finance, to nurture and promote talent at every level.

Ramifications of Brexit

As newspaper column inches and broadcast airwaves continue to be filled with news on Brexit, the tune has largely remained the same with many questions unanswered. A guiding 'principle' of the Brexit negotiations published by the EU clearly states that 'nothing is agreed until everything is agreed'. Therefore, there is still a big question mark over the exact ramifications on the global financial services industry, which is a concern for businesses.

The Isle of Man Government has been actively engaging with key politicians and senior officials in Westminster and Brussels to ensure the Island’s position is understood and defended. We expect our financial services industry to remain largely insulated from the effects of Brexit as the EU is not a significant market for the Isle of Man.

Continued focus on innovation

As competition intensifies, financial services businesses will need to transform and innovate themselves to survive. Most firms have already been diversifying into new products and services and investing in technology as they seek to drive growth, improve client experience and achieve greater operational efficiencies. There is no doubt this trend will continue into 2020 and beyond.

As businesses transform, they will be drawn to international financial centres which have innovative frameworks in place already and can therefore help them maximise opportunities. Under the Island’s Alternative Banking Regime, CIB Limited, part of the Isle of Man headquartered Capital International Group, was recently granted a provisional banking license to build a new digital bank aimed at qualifying corporate clients and high-net-worth individuals.

In March this year, the Isle of Man Blockchain Office and Sandbox opened to interested applicants. The Sandbox will provide a collaborative space for businesses to live-test their product, service or delivery mechanism where they will be supported by the Blockchain office which provides expertise, guidance and marketing support. Ultimately, the Sandbox will facilitate and encourage collaboration between companies. 

Conclusion

As the wider industry landscape continues to shift significantly, businesses will be looking towards an international financial centre which can help them navigate the uncertainties. With a robust regulatory framework, long standing heritage and politically and economically stable environment, the Isle of Man remains confident and optimistic as the curtain rises on another year. 

The full 2019 IOM e-privateclient report is available here.

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