Since 2008 the world’s perception of offshore financial services has shifted from being largely disinterested and uninformed to becoming highly attentive and often, ‘misinformed’.
Learn from the past we must. Guernsey dealt with the criticism that was and continues to flow in our direction as Guernsey deals with most scenarios – quietly but, crucially, diligently.
In PEA’s world of private equity, our general business operations were so different back in 2008. However, Guernsey’s response to how it should operate over the 10 years that followed supported our own growth trajectory.
Prior to 2008, tax reporting and governance requirements were straightforward, and portfolio valuations less cumbersome. Anti-money laundering checks existed but were far less stringent than today. The economic crash then brought in its aftermath global standards that insisted upon transparency.
Guernsey met the challenges that were being created internationally by taking every opportunity to ensure the foundations of its financial services make-up were robust and grounded in the best of breed of regulatory standards, in openness and in strong governance.
Guernsey was one of the first jurisdictions to sign up to FATCA and then CRS and grew its dialogue with Europe, even being open to being assessed by MoneyVal.
Today, regulation has become the tried and tested route. The Guernsey Financial Services Commission knows our industry intimately. Consistently, our regulator has shown itself to be approachable, flexible and to listen widely to the industry it represents while keeping a close eye on the global landscape. Recent products like Guernsey’s PIF regime and Guernsey Green Fund evidence this. Anti-money laundering processes, while critiqued initially for protracting timescales and heightening fees, are today valued with technology options easing their position into business as usual.
What we now offer 10 years on are standards of professionalism that place Guernsey as an outstanding and highly competitive international finance center. Guernsey has a concentrated talent pool of fund administrators, lawyers, accountants and advisers that offer a progressive mindset to today’s industry. Expertise in regulation, corporate governance, anti-money laundering and GDPR are deemed essential in our sector. Since 2008, routine training and development are fuelling Guernsey’s ability to retain its credibility globally. Now, knowledge is capital.
At PEA we see the boards of 2018 accepting and even valuing governance and willingly setting the tone for how standards are adopted. Global regulations like GDPR and AEOI impact widely and investors expect expertise in them and challenge their fund managers on their procedures, processes and the quality of their sub-contractors.
Technology and communication processes are unrecognisable in 2018 compared to 2008. Out with the fax for call notices and post for annual accounts and in with email, client portals and Microsoft OneDrive.
Security is at the top of today’s communications environment and rightly so with GDPR influencing the imminent way forwards in partnership with cybersecurity. Guernsey needs to firmly shape its approach to these areas. We should be thinking about a patch to investing in technologies for our regulator, registry and income tax functions to streamline data entry and its integrity.
Over this decade Guernsey’s approach has helped businesses like PEA to grow. In 2008 we had a small number of client groups, four employees and were primarily focussed on the Guernsey market. Fast forward to 2018 and our client groups have tripled as have our employees. Our primary geographic markets have grown to include Sweden and Denmark.
Should Guernsey do anything differently? I think we should have a louder voice that heralds the strengths of our progress.
James Orrick holds a Masters in Corporate Governance from Bournemouth University, a BSc (Hons) in Accounting and Finance from the University of Essex, is a Fellow of the Association of Chartered Certified Accountants and the Institute of Chartered Secretaries and Administrators.