Hong Kong Business High Flyers 2023

Uncertain China reopening threatens Hong Kong banks in 2023 Demand for HR technologists to grow in 2023 Hong Kong companies to ramp up hiring of sales and marketing professionals US recession, possible China reopening to weigh on Asian economies Stronger fashion sector seen in medium term

ANNUAL 2023

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How else can Hong Kong’s startup ecosystem improve

Even with an already vibrant and healthy startup ecosystem in Hong Kong—housing 3,750 startups, of which, 18 are unicorns—the industry is not without challenges. Microsoft Hong Kong pin-pointed three pain points for these newly formed local businesses.

Architects to remodel Hong Kong into a greener, more future-ready city

Sustainability drives have long emerged in an attempt to mitigate the worsening climate crisis, a lesson learned in the hard way. In light of this, Hong Kong architects expect that the city will be remodeled to have a greener design. On top of this, Hong Kongers will likely see infrastructure projects that will further integrate the city into the Guangdong-Hong Kong-Macau Greater Bay Area development.

According to Kelvin Tse, Director for Global Partner Solutions at Microsoft Hong Kong, startups are challenged by the lack of technological stacks to support and build their businesses; a marketing strategy that will introduce them to their target customers and promote their products; and escalation for them to expand their reach internationally.

making real estate decisions after postponing them last year due to the pandemic.

Hong Kong’s most notable real estate agents under 40

In 2022, Hong Kong has slowly regained its attractiveness as a property investment destination, and amongst to thank are the city’s realtors who were determined to end the city’s downcycle. In recognition of their hard work, Hong Kong Business listed 17 realtors under 40 who not only thrived in managing clients and negotiating deals but also displayed leadership in their respective communities amidst challenging times.

Office market to recover despite high vacancy rates

Hong Kong’s office property market is in a state of recovery although vacancy is still high as corporate downsizing continues. Because of this, overall net absorption remains in the negatives. According to JLL’s Hong Kong Property Market Monitor, the overall net absorption in July was -89,000 square feet.

Compared to figures last year, gross leasing volume has improved as tenants resumed

Hong Kong lenders gear up sustainability initiatives as post-pandemic era dawns

More than a year after the pandemic first began, its effect on Hong Kong banks’ headcounts has finally been reflected in its 2021 bank rankings, with over 2,100 workers in the industry displaced. But whilst the crisis is finally winding down as vaccines are rolled out across the city, banks—both local and foreign—face a new type of challenge: navigating the growing preference for sustainability, whose importance has been further highlighted in the past year as COVID-19 raged worldwide.

Marketing Briefing: ‘Go-local’ trend rises as pandemic drags on With the prolonged mobility restrictions due to the pandemic, consumers in Hong Kong are opting to buy local products or travel domestically, according to PwC’s latest Global Consumer Insights Pulse Survey. An average of 51% of consumers globally—41% in Hong Kong—in the survey were actively more supporting local independent businesses and were buying from local independent retailers in the past six months, according to the June survey.

Green finance in APAC to grow amidst data and disclosure gaps

Green finance is proving to be a rapidly growing sector in 2021. Based on data from the Climate Bonds Initiative (CBI), 2021 green bond issuances might exceed that of last year, with $219.7b issued for the first half of 2021 compared to the US$290.1b issued in 2020. Bonds issued from the Asia-Pacific made up more than a quarter of the first half’s figures, at US$51.9b, just a few millions short from the US$53.2b issued for the entire year of 2020.

Should Hong Kong’s brickand-mortar retailers ride the e-commerce wave?

Online sales accounted for 6.3% of total retail sales in 2020, according to PwC, which saw a “very modest” increase to 7.4% as of September 2021. Analysing this, a PwC executive said that Hong Kong retailers may have fallen short.

“If you look at the actual amount of online sales, we’re talking about only 7% of retail sales overall.

Hong Kong retailers are still not doing that much of moving their business models into online-tooffline (O2O),” Michael Cheng, Asia Pacific, Mainland China and Hong Kong Consumer Markets Leader for PwC, told Hong Kong Business.

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rents, plans under the Landlord and Tenant (Consolidation) (Amendment) Ordinance 2021 to prohibit any increase in the rent for the first term of tenancy, which is equivalent to two years, should be welcomed.

from HK$111b to HK$92b, it still managed to retain the second spot in 2021’s rankings.

Competing for the best talent in Hong Kong’s shrinking talent pool

Companies racing to fill roles— this has been the state of Hong Kong’s job market as its talent pool continues to shrink year by year. In 2022, the struggle to reel in employees remains to be felt by 85% of companies, according to the Digital Salary Survey 2022 by Robert Walters and Walter People. The shrinking talent pool, however, can be broadened, and employers can even net the best in the workforce if they dive into different strategies, according to analysts.

On renewal, which is another two years, landlords of the socalled “cage houses” or “coffin homes” may only increase rent up to a 10% cap, but they may be restricted to an even lower rent rise.

Prepare to go cashless or pay the price

With more consumers planning to drop cash and go fully digital with their payments in 2022 and in years to come, and with one in three abandoning a purchase when not given a digital payment option, small businesses really have no other way to go than shift to cashless.

Fortunately, a majority (95%) of small and medium enterprises (SMEs) are planning to accept contactless payment or some form of digital payment option in 2022, according to Visa.

One chat away:

Conversational commerce levels the playing field for brands online

A new canvas: Why artists are jumping into the NFT space

Artist Lakshmi Mohanbabu would usually get a one-time earning for a piece of art she sells in a gallery. When she took a dive into the non-fungible token (NFT) space, she realised that she can make much more.

In an interview with Hong Kong Business, Mohanbabu said artists can get a percentage of a future resale of their NFT-minted artworks because they are able to impose a royalty fee.

“In traditional galleries, when my art is sold to a client and I make a hundred dollars, then that’s it. If that client resells my artwork for a million dollars, it will no longer benefit me as the artist,” Mohanbabu said.

Time for a comeback? Hong Kong’s top 50 insurers show a 9.75% surge in assets

With the skies clearing, Hong Kong consumers will still prioritise making sure they have an umbrella handy, a fact that Hong Kong insurers took note of as they ready health and wellness products for 2022.

Rent control bill aims to bury abusive ‘coffin home’ landlords

It has been over two decades since rent controls have been implemented in Hong Kong, a city that has usually been laissez-faire with price controls; which is why for low-income families dwelling in subdivided units (SDUs) who have been grappling with high

Hong Kong Business 2022 Insurance Rankings has revealed that the industry’s top 50 insurers total assets surged by 9.75% to HK$709b in 2020 from HK$646b.

AIA International continued to retain its number one spot in the rankings despite its total assets declining to HK$126b in 2020 from HK$141b in 2019. This was also the case for Prudential (HK) Life. With its total assets dropping

Fiona Thia, business development director at TMX, was looking for a ring online. She can only roughly estimate her ring size based on the chart posted on the store’s website. Already expecting her order to be hit-or-miss, she then received a message from the brand asking for a photo of her finger to help settle the size and assuring her that, if the item did not fit, she can have it exchanged with no additional payment. Thia also received a follow-up message to check on the item delivered.

HK aims to regain crown as favoured arbitration hub with ORFS bill

Currently, lawyers handling arbitration cases in Hong Kong usually get paid by the hour under standard fees arrangements. But with the Law Reform Committee’s (LRC) push to finally allow legal practitioners to enter into outcome-related fee structures (ORFS), lawyers can structure a fee arrangement that suits the specific client and the specific case.

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How key aviation players are pushing the industry for takeoff

which in turn may result in higher sales interest, demand, sales volume, and price appreciation.”

How can a metaverse gaming platform drive foot traffic to businesses in the real world

Here are five bad habits in insurance according to HK’s insurance regulator

For a market ranking first globally in insurance penetration according to research firm Swiss Re Institute, it is surprising that Hong Kong’s insurance literacy rate stood only at 52%.

In the 2022 Report on Insurance Literacy Tracking Survey (ILTS) in Hong Kong 2021 by the Insurance Authority (IA), it was found that most, Hong Kongers are moderately literate when it comes to insurance.

“Whilst it might look like tenants will be the real winners here, the reality is that only a small proportion will reap the full benefit,” Janice Yau Garton, partner at Stephenson Harwood, told Hong Kong Business. According to Garton, many taxpayers will still not be able to fully claim their actual cost of rent given the deduction ceiling of $100,000 for each year of assessment.

Whilst reports say that Hong Kong has lost its aviation hub status, key players in the city remained confident in the future of the industry. What gave Cathay Pacific, Hong Kong’s flag carrier, “great confidence for the long-term future” of the industry is the HKSAR government’s removal of the hotel quarantine arrangement for locally based aircrew and travellers.

“These adjustments will help boost sentiment for travel, thereby facilitating the gradual resumption of travel activities and strengthening of network connectivity to, from, and through the Hong Kong aviation hub,” the airlines said.

Remember the phenomenon that was Pokemon Go, and how it boosted foot traffic in malls all around the world? This was what AiR World Founder Gabriel Kwong has been doing for local businesses in Hong Kong, but he did it by incorporating the latest talk of the town—metaverse. Kwong and his team created a metaverse-to-go gaming platform where real-life, physical locations act as a gateway to another dimension of AiR’s virtual world.

Why tax deduction on domestic rents is not a win for tenants

When the legislation allowing tax deduction on domestic rents was passed by the Legislative Council, it was called an “ease to the burden” of taxpayers who are renting; however, a law expert argues that the bill is not necessarily a win for tenants.

No spacious homes for Hong Kong’s poor anytime soon Hong Kong’s poorest families hoping to live in more spacious houses can bid their dreams goodbye because the per capita living space issue in the city will not be resolved anytime soon, especially after the average waiting time for public housing was extended to a record-breaking 6.1 years by end of March.

Waiting time is defined by the Housing Authority as the “time taken between registration for PRH and first flat offer, excluding any frozen period during the application period.”

The 6.1 years was the longest average waiting time in 23 years, according to JLL. By June, however, waiting time was slightly reduced by 0.1 to 6 years.

2023

Buyers from the Mainland have been dubbed as the “major purchasing power” supporting Hong Kong’s luxury market, which is why a possible reopening of borders between the two locations bears good news for the property segment.

Jordan Miller, Managing Director of real estate agency OKAY.com, told Hong Kong Business that a free flow of travel or movement between Hong Kong and China will “create a strong catalyst for buyer interest from China to resume to pre-COVID levels,

Why is Hong Kong robust in the energy war?

Unlike the rest of the world, Hong Kong has a more secure and diverse energy supply, making it resilient to brownout threats and reducing exposure to the highest energy costs seen in many countries at this time. For example, the nuclear electricity supply from Daya Bay Nuclear Power Station is extended up until 2034. This can help Hong Kong keep up with the energy crisis, Mike Thomas, a founding partner at energy consultancy firm, The Lantau Group, told Hong Kong Business.

Why will Mainland’s border reopening be crucial for the luxury market in

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How companies can successfully transition to hybrid work in just 2 steps

gigantic rise in the number of shoppers using online purchasing services in 2020. The Census and Statistics Department reported that the percentage of consumers aged 15 and above, who made at least one online purchase last year rose to 43.1%, up from 35.8% in 2018.

6 in 10 customers want restaurants to use sustainable packaging for takeaway

food

Over half of customers (66%) want restaurants to adopt sustainable packaging, Deliveroo has found. A similar number of customers (61%) also said the availability of sustainable packaging would be one of their key considerations when ordering food delivery services.

How financial institutions can overcome the towering demand for ESG roles

Hong Kong’s finance sector has never been truly invested in the environmental, social, and governance (ESG) piece, according to HR expert Steve Parkes. “Strong ESG people” across the globe who could have been considered to fill the roles are already less interested in Hong Kong for reasons like politics and the city’s pandemic response.

There are several suggestions on the internet on how organisations can transition to a hybrid work setup. Some say it takes a sevenstep plan, whilst others say there are about 10 ways to ensure that the shift runs smoothly; but according to an expert at tech company Cisco, companies only need to focus on two things to achieve the new work model.

In an interview with Hong Kong Business, Wilson Ching, general manager of Hong Kong and Macau at Cisco, said adoption of a hybrid work model begins with a culture change.

Decline in expats drags luxury residential market

The luxury residential rental market saw a huge decline in the last three months of 2020 as border closures became a hindrance for potential buyers, as well as capital inflow. However, the second quarter (Q2) of 2021 saw the end of eight consecutive quarters of decline as luxury residential rents recorded an increase of 1.4%, which analysts say is a sign of rents bottoming out for the first half.

Amongst age groups, Gen X consumers (aged 46-55) were most supportive of sustainable packaging, with 69% saying sustainable packaging is a key consideration of takeaway orders, followed by Gen Z (aged 18-25) (57%).

Deliveroo also found that consumers tend to order from restaurants using sustainable packaging (62%) and are even willing to pay more for sustainable packaging when ordering takeaways (66%).

Achieving board diversity:

It takes more than giving additional seats to women

Contrary to what most headlines say, achieving board diversity is not a numbers game of how many seats should be given to women or the young, but rather a fight to eliminate a “groupthink” mindset or thinking and perceiving things the same way amongst executives.

What the future looks like for brick-and-mortar retail in HK

Just as businesses were forced to speed up their digital transformations during the pandemic, many consumers had to make the switch from traditional shopping in physical stores to online. The retail sector was amongst the industries hit hardest by the pandemic; and out of this disruption, changes in consumption behaviours have emerged – some of which may be here for the long haul.

Online consumers in Hong Kong are on the rise, with a

Israel and Hong Kong forge fertile business bonds Hong Kong is soon to be a safer place for health workers due to closed system transfer devices that minimise their exposure to hazardous drugs when administering medication. This technology was developed by Simplivia, one of the many Israeli companies that have seen the advantage of doing business with Hong Kong.

What are 6 financial services trends that will emerge in the GBA in the next 5 years?

Accounting and finance professionals in Hong Kong believe there will be six trends that will influence investments in the Guangdong-Hong KongMacao Greater Bay Area (GBA) in the next five years.

The first of which is a growth in corporate investment, which 68% of professionals predict will happen. Another trend that will emerge will be corporates and investors participating in green finance and carbon trading.

According to CPA Australia, 48% of experts said their company will participate in such practice in the next five years.

Electronics dominates merchandise export

Telecommunications equipment, semiconductors, and computer items largely contributed to the total electronics exports.

Hong Kong’s electronics industry is the territory’s largest merchandise export earner, accounting for 72.6% of total exports in 2021. A substantial portion of these exports is regarded as high‑tech products, especially those related to semiconductors, telecommunications equipment, and computer items. Mainland China is both the major source of and the major destination for Hong Kong’s electronic products trade.

According to the latest available statistics, Hong Kong was the world’s largest exporter of electronic integrated circuits; the second largest exporter of mobile phones, computer parts/accessories, and video cameras; and the world’s third largest exporter of video recording apparatus in value terms in 2020. This is thanks to the huge re‑export business handled through the territory, as Hong Kong is amongst the major global trading hubs.

Parts and components constitute about three quarters of Hong Kong’s electronics exports, of which the majority are re‑exported to mainland China for outward processing production. Finished goods constitute about one quarter of the exports, of which the majority are consumer electronics for domestic

use, including a wide range of audio‑visual equipment, computer products, and telecommunications equipment.

Most Hong Kong manufacturers have relocated their production facilities to mainland China to reduce costs. Their Hong Kong offices now focus mainly on R&D activities, product design and development, management, logistic support, marketing, etc. Their setups in Hong Kong are largely classified as non‑manufacturing establishments statistically, despite the fact that they have manufacturing activities across the border.

Against fast changing markets and advancing technology, Hong Kong companies emphasise quick response to ensure effective services to their customers. Also, many Hong Kong companies have further strengthened their quality assurance and environmental management systems, and are accredited with ISO 9000 – an internationally recognised standard for a quality management system, ISO 14000 – a standard for an environmental management system, etc.

The 14th Five Year Plan indicated clear support from the Central Government to Hong Kong for the development of an

international innovation and technology hub. Hong Kong Science and Technology Parks Corporation (HKSTP) set up the Data Technology Hub (DT Hub) and Advanced Manufacturing Centre (AMC) in Tseung Kwan O, assisting companies to speed up digitalisation, and offering flexible and intelligent production lines for manufacturing. HKSTP also set up the Microelectronics Centre (MEC) in Yuen Long, offering dedicated cleanroom and special chemical handling facilities to support the development of new generation microelectronics products and their pilot production.

Hong Kong’s exports of electronics

Hong Kong’s electronics exports significantly increased by 27.7% in 2021. The major export markets were mainland China (accounting for 65.1% of the total exports in 2021), the EU (6.8%), the ASEAN (6.1%), and the US (4.6%). Exports to mainland China greatly increased by 28.6% in tandem with the sustained revival of the global economy.

Distribution channels

Hong Kong companies engaging in the parts and components business are capable of producing on a custom‑made basis and offering total solutions for famous US, European and Japanese companies, e.g. parts and accessories of computers, RF modules for telecommunication purposes, chipsets for LCD modules, etc. Meanwhile, standard components are usually exported directly to distributors and manufacturers in overseas markets, whilst some Hong Kong companies also have their own sales offices and/or representative offices in mainland China and other overseas markets.

Notably, Hong Kong is an important trading hub for electronic parts and components in Asia‑Pacific. Many items from the US, Europe, Japan, Taiwan, and South Korea are re‑exported via Hong Kong to the mainland, and vice versa. A number of multinational parts and components manufacturers have set up offices in Hong Kong, engaging in sales, distribution, and sourcing activities in the region.

Regarding finished items, Hong Kong companies mostly produce on an ODM basis for reputable brand names in overseas markets. Some of these major buyers have set up offices in Hong Kong for direct sourcing.

“Against fast-changing markets and advancing tech, Hong Kong companies emphasise quick response.”

Mainland China is both the major source of and the major destination for Hong Kong’s electronic products trade

Performance of Hong Kong’s Exports of Electronics

2021 Jan-May 2022

Domestic Exports 2.6 +25.3 2.4 -6.1 0.6 -44.7

Re-exports 2,817.2 +3.4 3,599 +27.1 1,393.9 +3.4

of Chinese Mainland Origin

2,819.8 +3.4 3,601.4 +27.7 1,394.6 +3.3

1,582 -1.1 1,951.5 +23.4 719.1 -1.8 Total Exports

Hong Kong companies also sell to specialised importers and traders in North America and Europe, who distribute the merchandise under their own channels or re‑sell to their clients for further distribution.

There are also a number of Hong Kong companies marketing electronic products under their own brand names, including Truly, V Tech, Group Sense, Venturer, GP, and ACL. Their sales network covers not only advanced countries but also economies like Latin America, Eastern Europe, and various parts of Asia.

Promotion via participation in trade fairs is an effective way for Hong Kong’s electronics companies to explore market opportunities. Important trade fairs include the CES Show held in the US, Electronica in Germany, Taipei International Electronics Show in Taiwan, CommunicAsia in Singapore, and the Hong Kong Electronics Fair organised by the Hong Kong Trade Development Council (HKTDC). Business missions organised by the HKTDC to the mainland and other emerging markets also provide opportunities for Hong Kong companies to establish connections with potential buyers.

Product trends

On the back of technological advancement and falling prices amidst keen competition, conventional IT products like notebook computers have become mass products. Now, the industry is focusing on further technological enhancement to sustain the business. Notably,

mobile devices with enhanced smart features are in demand around the globe.

Meanwhile, mobile communication has become part of the daily lives of consumers in most countries. In particular, sales of high‑end smartphones are rising at a rapid rate. Many models are now compatible with certain wearable electronics and other smart devices. This has attracted demand, especially from youngsters and high‑income consumers.

Digital technologies

In consumer electronics, one key development is digital imaging, in particular, large‑screen digital TVs with connectivity. This enables internet surfing with the so‑called “smart TV” features and the ability to communicate with mobile devices, as well as ultra‑high definition TVs (UHDTVs) with a display resolution of 4K or higher.

In addition, some players are keen to promote 3D printers in view of the falling printing and other material costs. Also, the industry is keeping an eye on the development of certain niche items, such as action camcorders and drones, as well as products related to the Internet of Things (IoT), which are taken by some players as means to inspire the market and create new business.

Smart homes will be one of the major IoT application areas that could elicit huge demand for related IT systems, hardware, and devices.

The COVID 19 pandemic has affected daily life in

unprecedented ways. The rising awareness on personal hygiene and health has driven strong demand for health‑related electronic products, such as air purifiers and infrared thermometers. As for businesses, the pandemic has accelerated the adoption of digital technologies. Many enterprises have introduced smart devices to their offices, such as interactive whiteboards and smart meeting rooms to make remote conferences more productive and engaging for employees, thereby driving the demand for electronic products.

CEPA provisions

Since the implementation of the third phase of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA III) in January 2006, all products of Hong Kong origin can be imported into the mainland at zero tariffs.

In December 2018, the mainland and Hong Kong signed the Agreement on Trade in Goods, which further enhanced the arrangement for rules of origin (ROOs). Starting from 1 January 2019, goods of Hong Kong origin fully enjoy zero tariffs when imported into the mainland. In addition to the product‑specific ROOs (PSRs), Hong Kong and the mainland introduced a general rule of origin (General Rule) based on a calculation of the value added to the products in Hong Kong. Products without PSRs would instantly enjoy zero tariffs upon importation into the mainland, subject to the fulfilment of General Rule.

“The pandemic has driven strong demand for health-related electronic products.”

SOURCE:HongKongCensusandStatisticsDepartment

company and industry - printing

Major printers relocate to Mainland to reduce costs

Printing is a support industry for publishing and advertising, and also for various light consumer goods industries (toys, food, cosmetics etc). Most printing companies in Hong Kong are small and medium enterprises (SMEs). They produce a wide range of printing materials, including books, booklets, brochures and leaflets, paper and paperboard labels, advertising materials, commercial catalogues, calendars, postcards, and greeting cards. Some specialise in the production of higher value‑added/hi‑tech printing products, such as children’s novelty books with pop‑ups and additional objects, chequebooks, passports, bills and statements, securities and prospectuses. Creating these products requires considerable specialist skill, substantial capital investment, and confidentiality.

Major printers have relocated production to mainland China with purpose‑built plants to reduce operation costs. Such development has changed the workflow and logistics and greatly improved efficiency and output quality. However, they still maintain their offices in Hong Kong to receive overseas orders. The ability to meet high quality requirements has allowed Hong Kong to become a major global

printing and publication centre, despite the increasing price competition from mainland printers. Rising labour costs on the mainland are encouraging greater automation and mechanisation. Automation can also reduce human errors whilst increasing efficiency, productivity, and quality.

Overseas customers are increasingly looking for faster turnaround and shorter delivery time in order to maximise returns through smaller but more frequent orders. Hong Kong printers are known for quality, quick delivery, competitive pricing, and the ability to cope with short‑notice printing jobs. Their quality is comparable to that of printing businesses in the US, Germany, and Japan, the pioneers in printing technology. Hong Kong printers are also known for their inventiveness and willingness to find solutions to production problems.

Sales channels

A large share of the export business is attributable to orders received directly from overseas countries. This also includes orders from major international publishers in Hong Kong. Export orders are mainly handled by larger printers or dealers, who have established

business relationships with overseas customers. In an effort to capture overseas business, large Hong Kong printing companies have established offices overseas.

In order to expand business networks, explore market opportunities, and promote their company image abroad, Hong Kong manufacturers and distributors participate in trade fairs and study missions organised by the Hong Kong Trade Development Council (HKTDC), such as the Hong Kong International Printing and Packaging Fair. Another important international trade fair is Germany’s Drupa.

Industry trends

Many emerging trends in printing pertain to the advent of new technology or production techniques. Digital printing has gradually developed and been applied in a wide range of fields within the printing industry. Inkjet has become a preferred choice for most magazine/ book printers with the improvements of inks which are able to stick to gloss coated paper without the need for pre‑treatment. 3D printing has caught significant attention within the print industries and more utilisation is expected in the future. 3D printing technology will become increasingly low cost and support rapid prototyping processes and the manufacture of end‑use parts.

E‑commerce will continue to be an important channel for procurement in printing. The clumsy processes of specifying requirements, enquiries, checking the sample draft, amending information, confirming the order and so on, can all be done online. Besides, through the online portal, consumers can receive quotations with greater ease and speed, and products such as banners and brochures can be ordered and shipped more quickly.

Automation is another trend. This helps cut costs, improve quality and speed up the production process. For example, a printer can set up pre‑designed templates for frequent print orders such as business name cards so that they will be readily available to print on demand. The automated function of bulk uploading allows business name cards for multiple people to be ordered at the same time with a single digital file, saving time and effort, and ensuring consistency. With the rise of on‑demand printing production in smaller quantities, automation also allows printers to

“Many emerging trends in printing pertain to the advent of new technology or production techniques.”

Performance of Hong Kong’s Exports of Printed Matter

2019 2020 Jan-May 2021

Domestic Exports 1,374 +31.0 1,053 -23.4 473 -0.8 Re-exports 15,735 +0.8 12,805 -18.6 6,808 +14.9 of Chinese Mainland Origin 13,254 -5.3 11,148 -15.9 5,772 +13.2 Total Exports 17,110 +2.7 13,858 -19.0 7,281 +13.8

make adjustments and changes quickly with guaranteed precision and productivity.

Advertising and marketing materials would remain one of the largest sectors of the printing industry, despite the rise of online advertising. Posters, flyers, brochures, and other promotional materials are now printed mainly using digital technology. Digital printing enables direct imaging – sending texts and graphics directly from the computer to the printing machine without the use of plates. This shortens production time and cost and improves speed and accuracy. It is easy to operate and is suitable for printing small quantities where flexibility, short lead time, and customisation are important. Digital printing also enables the development of personalisation in packaging.

Some printers are also offering the “total solution” service, which includes auxiliary services like design, data processing, translation and editing, and electronic publishing. A number of large printers have developed vertically, such as manufacturing or trading paper, or forming strategic partnerships with suppliers, in order to minimise the effects of paper price fluctuations and allow the company to have better control over material supplies.

Product trends: interactive design and new substrates

Traditional printed products need more interactive designs to meet the emerging demands of various

market segments. Children’s books, for example, are becoming more sophisticated as children now expect to interact with them. They may listen and talk to them, use them to build models or solve puzzles, or even play with soft toys that are housed inside the book. C&C Joint Printing, a leading printer with almost 40 years of operations in Hong Kong, incorporated augmented reality (AR) in the production of The Story of Gingerbread Man children’s book to create a more fun reading experience. The ability to print on non‑paper materials such as glass, textiles, and metal has also become more important for printing companies to enhance offerings and attract more customers.

Personalisation and sustainability

With the rising adoption of inkjet technology in commercial printing, printers can create more personalised books such as planners and notebooks. It allows personalisation in all aspects, including the cover, back and spine design, font and colour as well as the interior design and format.

As publishers pledged to be more environmentally friendly, the focus on sustainable printing practices will inevitably continue. Print facilities are using more environmentally friendly supplies such as recycled paper and synthetic paper, polyester‑based fabrics, UV ink and soy/vegetable‑based ink. The chemical‑free plate system has also been introduced. Some

printers are also embracing technologies such as on‑demand printing and variable data printing as well as implementing in‑house recycling facilities in order to reduce wasteful production practices caused by overprinting.

The Mainland and Hong Kong Closer Economic Partnership Agreement (CEPA)

CEPA was concluded in June 2003 and subsequently expanded in the following years. All products made in Hong Kong, subject to CEPA’s rules of origin, enjoy duty‑free access to the mainland.

General trade measures affecting exports of printed The US Consumer Product Safety Improvement Act of 2008 (CPSIA) requires manufacturers and importers to show that products intended for children under 12 do not contain harmful levels of lead and phthalates. This applies to art materials, crafts, books, and magazines marketed to children under 12 years old.

The EU’s Toy Safety Directive (Directive 2009/48/EC) came into effect on 20 July 2011. Any books falling under the definition of a toy must be compliant with the directive if sold on the European market.

Switzerland is the only European country that currently has legislation in place to regulate food packaging printing inks. It prohibits direct contact of printing inks with food and identifies the only substances which are allowed to use on food packaging.

“The focus on sustainable printing practices will inevitably continue.”

SOURCE:HongKongCensusandStatisticsDepartment

company and industry - industrial sales and leasing

Private equity interest in warehouse assets persists

Prolonged external uncertainties and strict quarantine measures have begun to infiltrate the logistics sector.

With global economic uncertainties and disruptions to global supply chains ongoing, local air freight and container throughputs declined in the first eight months of the year.

As logistics demand dwindled, overall and modern warehouse rents registered 0.8% and 0.1% growth in Q3/2022 respectively, whilst both overall and modern warehouse vacancy rates rebounded slightly to 2.1% and 1.4% over the same quarter.

Whilst interest rate rises have deterred local investors and developers, private equity was still keen to acquire en bloc and whole floor warehouses for investment.

Looking ahead, whilst new supply has been gradually taken up, uncertain business prospects may prompt operators to become more conservative when making relocation and expansion decisions.

An escalating cost of funds as well as slowing rental growth may test investors’ appetite for logistics assets with positive yield carry quickly diminishing over the coming months.

“Fund investors are still keen on logistics assets despite a relatively quiet third quarter. Looking ahead, whilst new supply has been gradually taken up, uncertain business prospects may prompt operators to become more conservative when making relocation and expansion decisions,” Simon Smith, Savills Research & Consultancy.

External uncertainties cloud the local logistics sector

Ongoing external uncertainties are still causing global disruption to supply chains, and in turn

adversely impacting the local logistics sector. Whilst merchandise trade declined by 2.4% in the fi rst eight months of 2022, both air cargo and container throughputs continued to drift by 11.2% and 4.4% respectively over the same period.

Given such weak sentiment, the warehouse leasing market began to feel the heat, with many operators opting for renewal rather than relocation, and very few logistics players, except e commerce operators, in expansion mode.

In a quiet market, some deals stood out. DON DON DONKI relocated from Goodman Kwai Chung Logistics Centre to take up around 88,000 sq ft on LG and UG/F of Goodman Dynamic Centre (an expansion of around 30,000 sq ft) in Tsuen Wan. HKTV Mall meanwhile expanded to take up another floor (around 144,000 sq ft) in Mapletree Logistics Hub Tsing Yi. Overall warehouse vacancy rebounded to 2.1% in Q3, whilst modern warehouses also saw availability bouncing back to 1.4% of total stock. As logistics demand dwindled, overall and modern warehouse rents registered 0.8% and 0.1% growth in Q3/2022 respectively, whilst both overall and modern warehouse vacancy rates rebounded slightly to 2.1% and 1.4% over the same quarter. In general, landlords were eager to maintain occupancy rather than achieve above average market rents.

Private equity keen on logistics assets Whilst a succession of rate hikes has deterred local investors and developers, private

equity was still keen to acquire en bloc and whole floor warehouses for investment. GLP made their first logistics investment in Hong Kong by purchasing the warehouse at 8 12 Tsing Tim Street, Tsing Yi from Swire for slightly over $1b. Meanwhile, Goodman continued their recent venture into the strata titled market by purchasing another floor in Sunshine Kowloon Bay Cargo Centre for $368m, as well as paying $380m for a 72% share of Chuan Kei Factory Building in Kwai Chung. KaiLong, on the other hand, purchased a 90% share of Wing Shing Industrial Building in Kwai Chung for $433m, possibly with an eye to its redevelopment potential.

The investment transaction volume of stratified industrial premises continued to decline due to the COVID situation, a stock market tumble and interest rate rises, with the entire third quarter recording 456 industrial transactions, a 26% quarter on quarter decline. Both flatted factory and warehouse prices were stable over the quarter as a result.

Outlook

Looking ahead, whilst new supply has been gradually taken up, uncertain business prospects are causing operators to become more conservative when making relocation and expansion decisions. With the 5.3 million sq ft CaiNiao Smart Gateway only one year from completion, many modern warehouse landlords will make retaining their larger tenants a top priority over the next six to 12 months.

The escalating cost of funds as well as slowing rental growth may test investor appetite for logistics assets with positive yield carry quickly diminishing over the coming months. With applications for the 20% additional GFA for industrial redevelopment also slowing down, we may see redevelopment related industrial transactions quieten, leaving end users as the only active party pursuing industrial and logistics assets over the remainder of the year.

Credit: Savills, Industrial: James Siu, Oscar Chow Savills, Research: Simon Smith, Jack Tong https://www.savills.com.hk/insight-andopinion/#Research

“Uncertain business prospects may prompt operators to become more conservative when making relocation and expansion decisions.”

Ongoing

company and industry - office leasing

Office rents continue to fall

Vacancy reached new heights in the third quarter with buildings in Central and Kowloon East suffering the most.

The third quarter saw further rental declines across all districts ranging from 0.4% to 3.4%.

Vacancy now stands at 10.2% (6.5 million sq ft net) with notable pockets of availability appearing in Kowloon East (14.4% / 1.9 million sq ft net) and Central (8.3% / 1.3 million sq ft net).

In a regional context, it is worth noting that Hong Kong is still an expensive place to do business compared with many of our neighbours. The effective closure of the border with Mainland China has cooled demand from mainland businesses which, though remarkably resilient through the pandemic, is still below 2018 levels.

Looking ahead, besides mainland businesses, demand is emerging (modestly) from several areas including ESG firms, Fintech, cryptos and NFTs / art auctioneers, medical services, government and public bodies, and private members clubs.

“Although the border closure and

weak stock market have hindered further expansion by Mainland companies, we still see modest demand from ESG firms, Fintech, cryptos and NFTs / art auctioneers, medical services, government and public bodies, and private members clubs,” Simon Smith, Savills Research & Consultancy.

Market commentary

The third quarter saw further rental declines across all districts ranging from a relatively modest 0.4% in the Western Corridor (Cheung Sha Wan / Kwai Chung / Tsuen Wan) to 3.4% in Island South. From their previous peak in 2019, rents are now down by around 30% with further falls expected over the next 12 months. Vacancy now stands at 10.2% (6.5 million sq ft net) with notable pockets of availability appearing in Kowloon East (14.4% / 1.9 million sq ft net) and Central (8.3% / 1.3 million sq ft net). In some districts vacancy is close to or above GFC levels from 2009. Set against a

background of slowing economic growth and ongoing COVID restrictions, we expect demand to remain lacklustre over the final quarter of the year and vacancy can be expected to tick up into next year as new supply is added to the market.

In a regional context, it is worth noting that Hong Kong is still an expensive place to do business compared with many of our neighbouring cities. At least two cost of living surveys rank the SAR number one in the region, ECA International and Mercer, whilst Savills own data on the cost of renting prime prime offices put Hong Kong well ahead of its closest rival, Tokyo.

The effective closure of the border with Mainland China has cooled demand from mainland businesses which, though remarkably resilient through the pandemic, is still below 2018 levels. Prime movers are businesses involved in private funds or asset management, securities, banking, real estate and insurance. Demand remains heavily core focused and in Central Mainland businesses now occupy around 25% of all Grade A office space whilst that figure is significantly higher in Sheung Wan at 35%. Buildings with the highest PRC occupancy are all mainland owned and include CCB Tower, Bank of China Tower, Agricultural Bank of China Tower, and CITIC Tower.

Looking ahead, besides mainland businesses, demand is emerging (modestly) from several other areas including ESG firms, Fintech, cryptos and NFTs / art auctioneers, medical services, government and public bodies, and private members clubs. We are still seeing take up from serviced office operators but after aggressive growth since 2021 this has fallen back recently.

One major hurdle for tenants looking to relocate is cost as typical fit outs now average around $1,000 per sq ft plus reinstatement of $200 per sq ft making a three year lease term hard to justify. Landlords are responding slowly by offering larger rent free periods or even CAPEX subsidies in some rare cases. For smaller tenants, fully fitted units are particularly appealing in today’s market.

Credit: Savills, Office Leasing: Ricky Lau, William Yiu Savills, Research: Simon Smith, Jack Tong https://www.savills.com.hk/insight-andopinion/#Research

“Hong Kong is still an expensive place to do business compared with many of our neighbours.”

The effective closure of the border with Mainland China has cooled demand from mainland businesses

Hong Kong’s hotel industry recovers slowly

Hong Kong’s hotel industry is expected to recover at a gradual pace before the market fully reopens its border with the Chinese mainland, prompting hotel operators to align their services with the domestic demand.

In the Hong Kong Hotel Report November 2022, Knight Frank said operators have to ensure flexibility in providing products and services that will serve the demand locally to guarantee occupancy and cash flow.

“Before the border fully reopens with the Chinese mainland, we expect the hotel industry to recover at a slow pace,” the Knight Frank report said.

“It is certain that the new normal for the hotel sector will focus on a quality guest experience and differentiated product offerings,” it added.

As domestic demand is insufficient to fill the loss from international and Chinese mainland visitors, the occupancy level and average daily rate (ADR) of High Tariff A hotels will remain at low levels in 2023.

For the longer term, Knight Frank expects the hotel industry to hold momentum when the market and Chinese mainland fully reopen their borders, with local and international arrivals seen to rebound to 60% to 70% of the pre pandemic levels.

More investors are also expected to target converting hotels to long stay rentals accommodation, together with co living operators, it said.

2022 hotel performance

From January to August 2022, Hong Kong saw the number of overnight visitor arrivals

increase by 234% year on year (YoY) to 175,852. In August alone, the number skyrocketed by 529% YoY to 56,499 visitors. This came after the fifth wave of the pandemic was controlled in May 2022.

As such, the hotel performance improved due to the local staycation and hotel quarantine demands which pushed the occupancy rate and the ADR.

High Tariff A hotels’ occupancy jumped to 56%, up by 15 percentage points YoY in the first eight months of 2022, with the ADR rising by 16.5% YoY to $1,671. Meanwhile, the occupancy rate of High Tariff B hotels was up by 11 percentage points YoY to 71% with the ADR growing by 31.8% to $820.

Medium Tariff hotels, on the other hand, saw a five percentage points decline compared to the same period last year to 66%, and its ADR was up by 47.1% YoY to $687.

As of end August 2022, a total of 41 High Tariff A hotels opened with 21,471 rooms. This is compared to the only two new High Tariff A hotels that opened in 2021 which are The Arca in Wong Chuk Hang and WM Hotel in Sai Kung with 187 and 260 rooms, respectively.

Knight Frank has also identified five key trends that emerged in hotel operations.

Scaling down

Some hotel owners are cutting their hotel business to renovated hotels for other uses, mostly as residential property amidst the subdued residential market. Knight Frank said there are at least seven planning applications with the Town Planning Board (TPB) to convert to residential use since 2020 with a total of 4,823 flats.

“Hotel rates follow seasonal trends, while domestic housing has a far more stable and upward growth trend.”

It cited CK Asset’s plan which was approved by the TPB with the conditions to renovate two existing blocks of Harbour Plaza Resort City in Tin Shui Wai to provide 1,120 flats, which is a reduction of 78% from the 5,000 under the previous redevelopment plan. It completion was brought forward to 2028.

The Horizon Suite Hotel, another CK Asset property, will also be renovated and prived 758 flats, amongst others.

“Hotel rates follow seasonal trends, while domestic housing has a far more stable and upward growth trend. Hotel investors and operators who prefer lower volatility cash flow, while still enjoying the upside of seasonal uptrends may opt for partial conversion to long stay or co living space,” Knight Frank said.

Turning into a co-living space

Hotels are also attracting inventors’ interest in converting them into co living or long stay accommodation spaces. International funds were the main buyers of hotels through joint ventures with co living operators.

At least eight of the total 17 hotel transactions since 2020 included plans or have confirmed conversion into alternative uses such as co living or student accommodation, reaching $9.3b out of the total $12.7b transactions.

Knight Frank said that such premises offer more risk adjusted returns than traditional real estate investments.

“These partnerships provide stable cash flow, given longer term leases and high occupancy levels for co living premises, allowing operators to scale up their business and increase margins,” it said.

Some of the notable transactions include Weave Living and PGIM Real Estate’s acquisition of the 435 unit Rosedale Hotel in West Kowloon for $1.37b in June. This is part of their US$200m joint venture wearing PGIM Real Estate holds and 90% stake, whilst Weave holds the rest and leads the repositioning and operations of the acquired assets.

Knight Frank said the hotel investment volume is expected to “hold up,” adding that more investors are looking for en bloc hotels or apartments to turn into long term rental accommodations.

“Once the border opens, these properties could be operated as hotels. More partnerships are expected between operators and investors or property owners in the acquisition, development and operation of the assets, leveraging the scale of efficiency of the operators,” it said.

The sector has to adjust its offered services to cater to local demand.

Some hotel owners are cutting their hotel business to renovated hotels for other uses

Name of Hotel List of new hotels opened in 2021-2022 Hote l Retail Industrial Hotel

Quarter List of new hotels opened in 2021-2022 SOURCE:KnightFrankResearch/HongKongTourismBoard SOURCE:RCA/KnightFrankResearch

Asset repositioning, enhancement

Some operators have also taken the chance to reposition themselves or improve their concept through upgrades and renovations amidst the all time low tourist arrivals.

Knight Frank said Sheraton Hon Kong Hotel in Tsim Sha Tsui began renovation in November 2021 for the first phase of 100 rooms and suites that are now open to guests, the second phase which was set for launch in December 2022.

InterContinental Hong Kong is also set for rebranding in December 2022 as Regent Hong Kong, after renovations that started in April 2020.

“We expect to see some hotel operators take the opportunity amid the downbeat market

to upgrade and enhance their assets. This will provide more long term benefits, such as higher room tariffs, a new and broader clientele, and new income streams from non room revenue to hotel owners,” Knight Frank said.

Adopting theme-based elements

To target locals, there were a few theme based hotels that have opened in the past year, featuring a particular motif across the hotel such as the interior design, decor, dining, as well as amenity facilities.

Knight Frank said Fullerton Ocean Park Hotel has six children’s themed rooms that offer a sea view. Aki Hong Kong MGallery was also the first to offer a Japanese style tatami room to attract guests who often travel

House $78.3 billion

rooms 2021 3% 26% Retail 32% Industrial

Tsim Sha Tsui $9.3 billion $118.2 billion $97.4 billion

Jade Hotel

Skycity Hotel 1,208

Wong Chuk Hang The Arca 187 2021 39%

to Japan for a “homecoming.”

As the popularity and number of themed hotels in the market are increasing, theme based hotels are expected to be an “alternative growth driver” for the industry.

“Theme based elements play an essential role in determining the popularity of a hotel, so to increase the attractiveness and enhance the brand of a hotel, operators must do careful market research and ensure the theme matches the market trends,” Knight Frank said.

ESG measures

Hotel operators have integrated measures in the business and consider them as a strategic initiatives. These may include energy and water efficiency, reduced carbon emissions, sustainable buildings, responsible and sustainable sourcing, social impact, and transparent reporting, Knight Frank said.

Some of the ESG measures implemented include the “Staycation for Good” launched by The Rosewood with Social Venture Hong Kong. Through this, they offer a quarterly programme providing insights in addressing environmental and social issuers. Hong Kong and Shanghai Hotels also send recyclables to off site recycling facilities or for upcycling by partner organisations, amongst other initiatives.

"Theme-based elements play an essential role in determining the popularity of a hotel."

BANKS OUTLOOK

Uncertain China reopening threatens Hong Kong banks in 2023

Banks’ performance will be impacted amidst benefits from interest rates.

As growing interest rates continue to uplift the profitability of banks in Hong Kong, financial institutions are expected to be hit by the consequences of indecisiveness regarding China’s border reopening.

In the APAC Developed Market Banks Outlook 2023 report, Fitch Ratings reported that the wider net interest margins (NIMs) in 2022 from increasing interest rates will extend further next year, which will back the earnings growth of banks in Hong Kong.

Amidst macroeconomic woes, Hong Kong’s banking system benefits from a healthy liquidity buffer. But the sector outlook could face downside risks if there is a drop in liquidity buffers. This includes renewed market concerns on the market’s status as a global financial centre to significant capital outflows.

The Hong Kong SAR government is already on top of this by convincing international financial institutions to increase operations in Hong Kong as well as raise hiring financial talent in the market. Financial Secretary Paul Chan recently revealed that more senior global executives will also be deployed in the market.

Government data showed that 77 of the top 100 global banks are in Hong Kong. As of the end of August 2022, the banking system in Hong Kong was holding assets worth approximately $27t, which is about 9.5 times the size of Hong Kong’s gross domestic product (GDP) in 2021.

But these benefits will be mitigated by property stress and stringent travel rules that continue to weigh on Hong Kong’s economic prospects. As a potential border reopening is currently still in limbo in China, property risks will continue to fall on the market by next year.

Boosting the sector

As of September 2022, residential property costs declined by 9% but these risks remain manageable due to measures over mortgage lending, healthy property loan to value ratios, and strong household affordability despite the serviceability of newer

More senior global executives will also be deployed in the market

home transactions being threatened by the hike in interest rates. But a sudden decrease in property prices may affect the bank’s outlook as 32% of loans are connected directly to the domestic real estate sector. Of the percentage, 17% are residential mortgage loans.

If businesses start reopening from loosened cross border restrictions, it could boost an improving outlook for the banking sector.

The revival of businesses could increase profitability, higher volume loan growth, and better fee prospects, which will surpass funding cost pressures and credit costs.

With these factors, Hong Kong’s real GDP will soar by 3.5% in 2023, after shrinking by 0.5% in 2022.

China policy

China’s growth continued to be impacted by the domestic property market and weak consumer demand as an unintended consequence of stringent health measures to combat the pandemic.

Signs of policy support for the property industry and gradual progress in loosening health measures are starting to emerge but it is too early to conclude if these changes are enough to shift the economic fortunes of the region.

Growth and risk appetite for Japanese and Singapore banks

Banks in Japan and Singapore, which have a history of expanding offshore in emerging markets, have limited headroom within their current capitalisation and leverage scores.

Japanese banks already see their Common Equity Tier 1 (CET1) strained by the weakening yen versus the US dollar.

There could be a material rise in Japanese banks’ risk appetite in search of higher profit opportunities such as inorganic overseas investments as there are lower interest rates in Japan.

Common Equity Tier 1 ratios for Singapore banks have limited headroom within their “aa ” capitalisation scores and could be strained if more adverse scenarios materialise or if banks make further acquisitions.

Pressure on Singaporean banks’ CET1 ratios may be reduced by slower loan growth and higher profitability but equally, a large scale acquisition in emerging markets would have the potential to weigh on their blended operating environment scores and also their Viability Ratings (VRs).

Unlike Japanese banks, Singapore banks will experience upside risks from higher interest rates.

Amidst macroeconomic woes, Hong Kong’s banking system benefits from a healthy liquidity buffer

Singapore banks will be amongst the top beneficiaries of higher lending rates in Asia and the Pacific, NIMs will expand significantly in the near term, given the prevalent use of floating rates and the high proportion of low cost deposits.

South Korean banks’ resiliency

Even as there is a slowing global and domestic economy, the South Korean banking system’s overall financial profile will stay resilient.

Profitability and loss absorption buffers for the market’s banks are expected to stabilise but credit costs may rise as non performing assets rise.

In 2023, lower loan growth is expected to reduce the need for banks to raise additional debt, and deposits are seen to persist in the tighter monetary environment.

Capital buffers at banks should remain steady, but there is little room for growth due to the need to contribute to market stabilisation funds and banks’ focus on corporate loans.

The country’s economic growth is expected to decelerate to 1.9% in 2023 from 2.6% recorded in 2022. This projection could change to deteriorating if there is a further decline in the employment rate and other economic growth prospects due to sluggish global demand, supply chain shocks, and high inflation.

Highly leveraged households, self employed residents, and small and medium sized enterprises that rely on global demand are likely to be the most vulnerable in this environment.

Australian banking sector ‘steady with high inflation’

The banking sector in Australia will remain steady with high inflation

resulting in the Reserve Bank of Australia raising interest rates.

It will likely decelerate the market’s economic growth and adversely affect the highly indebted households.

There are no large losses anticipated for the banking system due to low unemployment and solid underwriting.

Loan growth in Australia is expected to slow next year, following a softening GDP outlook and lower credit demand.

The system’s loans and deposit ratio will remain broadly around the current level but below pre pandemic levels.

A decline in the liquidity coverage ratio to more normal levels is likely but driven by banks running down excess liquidity built up in 2020 and the phasing out of the committed liquidity facility at the end of 2022.

Steady loan growth for Taiwanese banks

The profitability of banks in Taiwan will be backed by steady loan growth and widening NIMs. But this will offset potential investment losses due to expected market volatility and a

modest rise in credit costs in 2023.

The disruptions from the pandemic have also ended and should have a limited effect on the market’s economic growth.

Amongst risks to the bank’s outlook include a prolonged global recession, a sharp correction in housing prices, excessive risk taking or growth in high risk emerging markets, aggressive growth and dividend payouts, and industry consolidation.

Taiwan’s relatively steady economy and housing market, as well as its prudent regulatory oversight, could boost the bank sector’s resilience despite global challenges that may subdue demand for high tech exports.

Taiwan’s GDP is expected to grow by 3.2% in 2022 and 2.8% next year.

Warning for housing markets

Prices in housing markets have declined in Australia, New Zealand, Hong Kong, and South Korea after several years of continuous increases due to low mortgage rates.

Whilst moderate declines would likely be welcomed by policymakers who tried to address affordability and increasing risks, a sudden drop in market confidence could grow systemic risks.

Factors such as healthy LTV ratios, mortgage insurance, and debt serviceability limits should mitigate the risks of asset quality deterioration.

Overall APAC woes

The banking sector in developed markets in APAC will see a neutral outlook. They can still be more resilient in the macroeconomic challenges than other countries in the region. However, most economies are not safe from the pressures of inflation. Loan growth in other markets will also be

APAC DM Banks - Rating Changes

Source: Fitch Ratings

Key Developed Markets Outlooks at a Glance

Source: Fitch Ratings

Demand for HR technologists to grow in 2023

As firms focus on a seamless digital employee experience and data management, recruitment experts believe that there will be more demand for human resource (HR) talent with IT knowledge and expertise with in depth quantitative and analytical skills to resolve people related business problems.

According to Randstad, sought after talents like HR technologists or those involved in human resources information systems (HRIS), may receive counter offers of up to as much as a 50% increment on their salary from their current employers.

“Over the years, many companies have expanded their human resources team by adding specialised headcounts in compensation and benefits, talent acquisition and management, HR technology, learning and development as well as employee experience,” Randstad said.

“Having specialised HR professionals not only helps alleviate the increasing amount of work piled

they enjoy working with, and having enough time to spend with their family and friends this is the work life equilibrium that employees desire to have,” Randstad said.

This is why Randstad encourages companies to “review their total workforce management to ensure that they are taking care about their employees’ overall well being.”

“Employee engagement initiatives like happy hours, sports activities and mental health support shows that the company cares about their employees’ well being enough to invest in human resources development,” the recruitment expert added.

Apart from IT skills, employers are also looking for HR talents with strong communication skills and the right personality that would fit their team and company culture.

“These attributes are essential in the role of a human resources professional, as they are expected to partner with various stakeholders in the business to improve the company’s talent attraction and retention strategies,” the HR expert said.

Beyond recruiting

Apart from data analysis, firms also expect HR professionals to be involved in business “partnering and planning for business continuity.”

on a generalist but also strengthens the team’s capabilities in creating a more holistic and positive candidate and employee experience,” the firm added.

Given that the HR industry is a candidate short market, these talents will not only have multiple offers to choose from but will also have the upper hand to negotiate a better package for themselves.

“Most of the HR professionals want the whole package deal which would include their salary expectations, flexible work benefits and a manageable workload,” Randstad said in its Salary Snapshot report.

In its Reimagine Work white paper, Randstad reported that two in three employees in Hong Kong working unnecessary or excessive overtime has led to poor work life balance.

Employees define work life balance as having enough personal time to do the things they like with the people they care about (29%).

“Employees want to have a manageable workload, the ability to work flexibly with the colleagues

According to the employment agency, PERSOLKELLY, the changing business environment has impacted the demands placed on HR.

“In addition to traditional tasks such as recruiting and setting compensation and benefits, HR is increasingly tasked with working with businesses and planning for business continuity,” the agency said.

“The latter is particularly important, as demonstrated by the disruption caused by the COVID 19 pandemic. Changes in the talent market, challenging economic conditions, and evolving government regulation require more preventive action and planning from HR,” it added.

PERSOLKELLY also reported that HR departments are increasingly taking on a strategic role to manage organisational change which has become the top agenda of many companies. Last year, Randstad predicted that the industry will see an increased talent demand for specialised HR professionals who are capable of driving organisational change.

HR is increasingly tasked with working with businesses and planning for business continuity

In-demand talent may receive counter-offers with a 50% salary increase.

Talents will have the upper hand to negotiate a better employment package for themselves

financial services

low med high

$80,000 $110,000 $140,000 senior HR manager $60,000 $75,000 $80,000 HR manager (5+ years) $40,000 $50,000 $54,000 assistant HR manager $30,000 $35,000 $40,000 senior HR executive $25,000 $30,000 $35,000 HR executive $18,000 $22,000 $27,000 L&D director $70,000 $80,000 $120,000

HR director

L&D manager (10+ years) $45,000 $55,000 $65,000 L&D manager (5+ years) $35,000 $38,000 $45,000 L&D officer $20,000 $23,000 $25,000 mobility specialist $20,000 $30,000 $45,000

organisational development manager $45,000 $55,000 $65,000 payroll manager (6 - 10 years) $35,000 $40,000 $65,000 payroll officer (<5 years) $18,000 $25,000 $32,000

regional talent acquisition director $80,000 $90,000 $120,000 regional talent acquisition manager $50,000 $65,000 $80,000 talent acquisition manager $40,000 $50,000 $65,000 talent acquisition specialist $25,000 $35,000 $40,000 talent acquisition coordinator $22,000 $25,000 $35,000

commerce low med high

HR DIRECTOR $70,000 $95,000 $120,000+ rewards director $75,000 $90,000 $130,000

HR manager (HR operation focus) $40,000 $55,000 $65,000 HR manager (specialised) $45,000 $60,000 $70,000 assistant HR manager (HR operation focus) $30,000 $34,000 $40,000

assistant HR manager (specialised) $34,000 $42,000 $47,000 senior HR executive $27,000 $32,000 $38,000 HR executive $17,000 $22,00 0 $27,000 L&D director $65,000 $80,000 $100,000

L&D manager (talent development) $45,000 $55,000 $68,000 L&D manager (training delivery) $30,000 $38,000 $45,000 L&D officer $18,000 $23,000 $28,000 rewards and mobility specialist $28,000 $35,000 $45,000 organisational development director $70,000 $85,000 $110,000 organisational development specialist $35,000 $40,000 $45,000 payroll manager (regional) $35,000 $48,000 $65,000 payroll manager (local) $30,000 $40,000 $55,000 payroll officer $17,000 $22,000 $28,000

regional talent acquisition director $75,000 $90,000 $110,000 regional talent acquisition manager $45,000 $50,000 $70,000 talent acquisition manager $30,000 $45,000 $55,000 talent acquisition specialist $25,000 $35,000 $40,000 talent acquisition coordinator $20,000 $25,000 $30,000

business support

low med high secretary $25,000 $35,000 $45,000 executive assistant $28,000 $42,000 $55,000 personal assistant $35,000 $50,000 $65,000 office manager $35,000 $48,000 $65,000 team administrator $28,000 $35,000 $40,000 receptionist $18,000 $22,000 $25,000

Source: Randstad Hong Kong 2023 Market and Salary Trends Digital Report

SALES AND MARKETING OUTLOOK

Hong Kong companies to ramp up hiring of sales and marketing professionals

not willing to pay higher wages.

Organisations in these sectors are expected to be faced with a “sharp manpower shortage” once borders reopen. This is especially so as most workers in the industry have shifted and found new careers amidst the health crisis and are unlikely to choose to return after opting for more stable jobs, and the experience on how workforce demands are affected by a global event, according to Randstad.

Demand in the technology sector

Randstad said technology companies will continue to hire sales professionals such as product managers, sales development representatives and sales specialists to meet the business requirements amidst the digital adoption and transformation.

Companies across various industries are expected to hire more sales and marketing talent as Hong Kong is now slowly opening its doors to international travel and some talents relocating to other cities which reduces the workforce in Hong Kong.

In the Market Outlook & Salary Snapshot 2023 report, Randstad said every company will be hiring specialised digital marketing professionals. The skills companies are looking for are generalist digital marketing, customer relationship management, growth performance, email marketing and content marketing.

“The rapid developments in digital marketing have led to an increasing talent demand for new and existing roles across all industries in Hong Kong SAR. Companies that have invested more into technology, specifically prioritising digital marketing over sales, are expecting a positive return on investments next year,” Randstad said.

E-commerce

Whilst many companies have increased their online presence, Randstad said some retailers are still hesitant to go online despite big discounts to attract traffic and the increased conversion rate reducing margins on goods and services.

The appetite for bigger salary increments is more evident in the technology industry and digital marketing

Meanwhile, companies that have ventured into e commerce for additional sales channels are seeing an increase in revenue and are looking into hiring new roles and capabilities. Particularly, multination and large companies have opened new specialised sales and marketing roles that will oversee end to end user experience and drive e commerce sales.

Financial and professional services Randstad said the talent demand in the financial and professional services sector has declined slightly in the past years due to companies’ relocation to other hubs such as London and Singapore. The roles that remain in Hong Kong were left to drive partnership and growth across Greater China. It expects businesses in the sector to continuously focus on recruiting sales and marketing specialists to boost digital growth, customer acquisition and marketing performance.

“Talent with experience and capabilities in using business intelligence and analytical tools will asl be highly sought after,” it said.

Retail, travel, and hospitality Demand for talent in this sector is expected to “skyrocket” to be able to meet the forecasted inflow of travellers. However, employers would face difficulty if they are not prepared and

“Companies in software as a service (SaaS), artificial intelligence (AI), big data and enterprise solutions are expected to expand their sales team rapidly to service middle market and enterprise clients,” it said.

Sales and marketing professionals 2023 expectations

Salary increases for specialised sales and marketing talents are expected to return to pre pandemic levels due to the rise in demand. Workers who will be staying with their employer will get a 3% to 8% salary raise, higher than the 3% to 5% in the previous year.

Those who are switching employers next year will receive a 10% to 30% salary increase depending on the relevancy of their skills and experience.

“The appetite for bigger salary increments is more evident in the technology industry and digital marketing, where candidates can command up to a 20% increment on their total remuneration packages,” the Randstad report read.

Aside from salary increases, Randstad said sales and marketing professionals can expect and enhance total remuneration packages such as commissions and equity related benefits as companies are improving their offerings to attract and retain their workforce.

They are recruiting sales and marketing specialists to boost digital growth, customer acquisition, and marketing performance.

Every company will be hiring specialised digital marketing professionals

SALES AND MARKETING OUTLOOK

Services

Low Med High

$60,000 + comms $80,000 + comms $110,000 + comms sales manager $30,000 + comms $45,000 + comms $55,000 + comms sales executive $14,000 + comms $22,000 + comms $35,000 + comms regional sales lead $70,000 + comms $90,000 + comms $140,000 + comms

sales director

key account manager $30,000 + comms $55,000 + comms $75,000 + comms

product sales specialist $35,000 + comms $50,000 + comms $75,000 + comms pre-sales manager $45,000 + comms $55,000 + comms $75,000 + comms product manager $40,000 $55,000 $65,000

digital marketing director $95,000 $115,000 $140,000

digital marketing manager $45,000 $60,000 $75,000 growth manager $40,000 $55,000 $70,000 marketing director $70,000 $90,000 $130,000 marketing manager $35,000 $50,000 $70,000 marketing executive $18,000 $25,000 $28,000 investor relations manager $40,000 $55,000 $70,000 public relations director $65,000 $80,000 $120,000 public relations manager $40,000 $50,000 $60,000 event manager $30,000 $40,000 $50,000 event director $50,000 $60,000 $70,000 communications manager $45,000 $55,000 $65,000 communications director $70,000 $85,000 $120,000 customer service manager $22,000 $25,000 $30,000 customer service executive $14,000 $16,000 $18,000 creative director $65,000 $80,000 $120,000 content manager $40,000 $50,000 $60,000 field marketing/ account based manager $45,000 $55,000 $65,000 product marketing manager $45,000 $50,000 $55,000 social media manager $40,000 $50,000 $60,000 partnership manager $35,000 $50,000 $70,000

Non-services

Low Med High

$100,000 $120,000 $150,000 retail director $60,000 $85,000 $120,000 retail manager $40,000 $48,000 $65,000 store manager (with commission) $30,000 $45,000 $80,000 store sales associate (with commission) $13,000 $20,000 $45,000 store supervisor (with commission) $23,000 $28,000 $33,000

general manager

marketing communication director $70,000 $85,000 $100,000 marketing manager $50,000 $60,000 $75,000 event manager $35,000 $45,000 $60,000 PR manager $40,000 $45,000 $50,000

digital / online marketing manager $40,000 $50,000 $60,000 digital marketing executive $20,000 $24,000 $28,000 e-commerce director $80,000 $100,000 $140,000 e-commerce manager $45,000 $55,000 $70,000

CRM director $70,000 $85,000 $100,000 CRM manager $40,000 $50,000 $60,000 training manager $40,000 $52,000 $65,000

Source: Randstad Hong Kong 2023 Market and Salary Trends Digital Report

US recession, possible China reopening to weigh on Asian economies

There will be mixed prospects for Asian economies amidst a plausible recession in the US and the potential loosening of cross border restrictions in China in 2023, according to Citi Global Wealth Investments’ 2023 Wealth Outlook.

In 2022, the slower reopening weighed the most on Hong Kong and the mainland. Geopolitical escalation also disrupted Taiwan whilst Korea was bearing the brunt of the tech bear market, especially in semiconductors.

But if China reopens, it could have positive effects beyond its borders by reviving demand and bolstering Chinese imports from the wider region. This development could mitigate some of the impacts of the European and US downturns.

China’s economy may rebound from 3.5% to 4.5% whilst Hong Kong’s economy may reverse from a 2.6% contraction to 2.8% growth.

Asia’s external resilience will stay robust and will likely avoid recession in 2023. The real economic growth of emerging Asian markets will reach 5% in 2023 after decreasing to just below 4% in 2022.

Japan will likely be the most resilient out of all Asian economies, with an above trend growth of 1.6%.

Other Asian economies are likely to see moderate deceleration.

A potential China reopening will also resume outbound Chinese tourism, which can help recover markets like Thailand, wherein tourism rebounded to 50% of 2019 levels without China’s travel resuming.

Easing of health restrictions will take place in the spring of 2023, following a potential winter wave of infections. This easing is expected due to recent medical advancements and changes in government messaging.

The economic stability of Asian markets has been largely preserved by their ample foreign exchange reserves, which can cover current account and short term debt by more than one year.

This helped to buffer the region from the negative effects of the Federal Reserve’s tightening of monetary policy in 2022. Despite a decline in reserves and weakening of currencies, the region is well positioned to weather potential external economic weakness in 2023.

China’s double-digit growth In Asia, Indonesia is the only market to produce positive returns in USD terms in 2022, increasing by 2%. Other markets like India and

Thailand, managed positive local currency returns.

Meanwhile, China, Taiwan, and Korea were grappling with falling local equities and currencies. Earnings results for 2022 seem to corroborate the equity returns with Indonesia, Thailand, and India leading, whilst China and Korea are falling behind.

Next year, the performance of Asian economies will depend much on the timing of the US and China’s cycles, with markets that are most insulated from potential external economic weakness likely to do best.

China may improve after two years of negative earnings and equity performance. There is expected additional progress to restore capital market activity, including more Initial Public Offerings from the technology sector, which could lead to a more visible recovery in 2023 and restore some investor confidence.

After its earnings fall by 7% in 2022, China is likely to see low double digit growth, and valuations may rise from distressed levels.

Japan’s equity performance

Japan’s equity performance was around the middle of the pack in Asia, with 15% earnings growth in 2022 that beat expectations. The drag came mainly from a 30% depreciation in its currency through October, which traditionally would have benefited Japanese equities.

But the depreciation in 2022 came from a record tightening in US monetary policy, which weighed on all assets. Japan’s economy was largely unscathed by inflation. The Bank of Japan’s controversial easing policy amid US Federal rates tightening may be vindicated if the US dollar continues to weaken in 2023.

The possibility of a yen recovery, with relatively stable policy and growth, may draw more investor inflows to Japanese equities.

Global cycle to strain other AsiaPacific markets

Other countries in Asia Pacific that are more exposed to the global cycle may still feel pressure, including Korea, Taiwan, and Australia, where earnings

Next year, the performance of Asian economies will depend much on the timing of the US and China’s cycles

China and Hong Kong will recover in a potential broader reopening in Asia.

The economic stability of Asian markets has been largely preserved by their ample foreign exchange reserves

are expected to fall in 2023. Indonesia’s commodity advantage may also be subdued in 2023.

Meanwhile, others in Southeast Asia like Thailand and Singapore may do well amidst broader reopening such as the potential easing of China’s borders.

In the longer term, as the US China rivalry continues, there is an expected drive toward building more domestic production capacity and in friendly markets, shifting the investor mindset from focusing on companies that enable consumers to those that facilitate production, likely supporting industries such as sustainable energy, telecom, core technologies, and select infrastructure.

Weakest currencies to gain most in 2023

Japanese yen, Australian dollar, and Chinese yuan may have suffered in 2022 but they may gain the most in 2023. According to the Bloomberg JP Morgan Asia Dollar Index, Asian currencies weakened 11.3% in 2022 through October. The US Fed’s 400 basis points of rate hikes through November left US yields much more attractive than many Asian sovereign yields.

The resulting negative carry caused capital outflows and impacted Asian currencies, with some central banks repeatedly intervening to support their currencies, such as Japan, China, and Hong Kong.

In 2023, Fed tightening will persist in early 2023 wherein the US dollar may remain supported.

But when US economic data gets weaker and the Fed pivots to cutting, the dollar may see risks.

The early signs of downside risks are already evident in late 2022.

The Japanese yen is likely to experience a strong rebound in 2023. This is because the Bank of Japan has maintained an easing stance, causing short yen positions to reach record levels. As a result, the reversal of the yen’s 30% weakening through October 2022 is expected to be significant.

The Australian dollar is also expected to reverse substantially. After depreciating by 18% between April and October, it rebounded by 8% in one month following the first hints of a peak in US yields.

The Reserve Bank of Australia has also consistently been raising rates and is expected to continue doing so despite the Federal Reserve’s hikes.

Chinese yuan experienced a 16% peak to trough depreciation in 2022 but could see a comeback in 2023.

Some suspect that China’s rebound may weaken its currency because its import demand will increase whilst exports fall as the US economy weakens.

But the Chinese currency’s depreciation resulted mainly from Chinese government bonds’ 1% positive carry turning to a 2% negative carry versus US Treasury bonds.

Such a gap will likely narrow if China stages a recovery and emerges from deflation, lifting Chinese yields in 2023 whilst US yields likely fall.

Investments

In 2022, the rise of global central bank policy rates and the Fed’s rate hikes of almost 400 bps through November caused all fixed income valuations to fall.

Higher US rates also pressured foreign exchange values. In US dollar denominated corporate bonds, China’s real estate sector continued to experience high levels of distress due in part to government policies contributing to a loss of market confidence.

This led to large sector price falls in high yield and formerly investment grade bonds. After the October Party Congress, China’s financial authorities announced comprehensive measures to stop widening defaults and facilitate restructuring, which led to a rebound in market confidence in November.

For investors with high risk tolerance, real estate may offer tactical outperformance if policies enable a rebound in sales and cash flows.

For more conservative investors, US dollar denominated investment grade issuers may offer interesting yield premiums to US counterparts of similar ratings and maturities.

Asian sovereigns with strong trade balances and healthy US dollar reserves may also be interesting for adding potential diversification to a global fixed income allocation.

Our Favored Asia Sectors (Ex-Japan)

Asia valuations and favored Asia sectors

Source: Citi Research, Worldscope, MSCI, FactSet

Source: Citi Research, Worldscope, MSCI, FactSet

Stronger fashion sector seen in medium term

Hong Kong shoppers are prioritising household spending in the near term, but this is expected to shift to the fashion sector between 2023 and 2026, Fitch Solutions reported.

This comes as international tourists return, which will likely bode well for Hong Kong as it is known for being a luxury shopping destination.

“The return to work and greater levels of socialising will drive short term growth in clothing and footwear spending in Hong Kong. We believe this growth will be sustained over the medium term (2022 2026),” the report read in part.

Fitch Solutions forecasts that clothing and footwear spending will be the strongest performing essential spending category over the next five years. In 2022 alone, clothing and footwear spending

grew by 7.9% year on year to $202.7b or around US$261b.

Some retailers have started banking on this as the brands have moved to expand their presence in Hong Kong. Just last July 2022, Singapore based Love Bonito, for instance, opened its flagship store in the city after entering the market in 2019 and opening a pop up store in 2021.

Clothing and footwear sales in Hong Kong were heavily impacted over the past years due to limits in traditional purchasing. Fitch noted consumers either reprioritised spending away from clothing and footwear or moved down price points.

Over the medium term, clothing and footwear spending will likely rise by an annual average of 6.7% to $260.3b, or around US$33.5b. This will outperform household spending growth projected to average 4.8%

per year. Fitch linked this to a refocus on fashion spending amongst Hong Kong shoppers.

“Hong Kong’s retail market has traditionally been supported by high household incomes and spending, with spending by tourists, particularly from Mainland China, playing a large role in the luxury end of the retail market,” Fitch said.

“The luxury market is particularly important in Hong Kong, with a large number of global luxury retailers present in the market to take advantage of Hong Kong’s status as a global financial centre as well as high spending Mainland Chinese and other international tourists.”

Essential vs. non-essential

In the near term, Hong Kong consumers will likely prioritise essential spending, outperforming non essential spending as Fitch expects disposable income in the market will see stunted growth in the next five years.

In particular, the average household disposable income is forecast to climb by 3.3% year on year to $449,400, approximately US$57,834. This will likely be cancelled out by the

Shoppers are expected to increase spending on clothing and footwear.

In the near term, Hong Kong consumers will likely prioritise essential spending

Clothing and footwear sales in Hong Kong were heavily impacted over the past years

stronger than expected inflationary pressures during the year which is estimated to average 1.9%YoY.

The average disposable income for Hong Kong households is expected to increase by 2.7% annually, reaching $498,000, or approximately US$64,092 in 2026. This is close to the 2.1% average annual inflation growth forecast, which will likely weaken consumers’ purchasing power. In the near term, essential spending will outperform non essential spending as Hong Kong consumers pivot spending focus on essentials rather than discretionary non essentials. In 2022, essential spending will grow by 5.7%YoY whilst non essential spending will grow by 5.3%YoY,” Fitch said.

“This trend would carry through the medium term as essential spending by Hong Kong households is projected to grow by an annual average of 5% whereas non essential spending would see 4.7% annual growth through to 2026.”

Luxury market outlook

Moving forward, Bain & Company noted that it expects the global luxury market to be more resilient in 2023 as it sees an expansion in sales and market value.

“The luxury market now appears better equipped to cope with economic turbulence with its consumer base both larger and more concentrated, and customer centricity and a multi touchpoint ecosystem set to provide resiliency amid disruptions,” the report found.

Across all luxury markets, China remains amongst the key countries, alongside the United States and Europe. Outside these key markets, Bain & Company sees “significant potential” in the Indian market, emerging Southeast Asia, Korea, and African countries.

Of these, India showed the biggest growth potential as Bain & Company projected the country could expand its luxury market by 3.5 times its size today by 2030.

“China itself, which remains crucial to the long term of the luxury market, continues to confront a challenging phase due to Covid lockdowns and is still performing below 2021 figures,” the report also read. “China’s luxury market is expected to recover between H1 and H2 2023.”

Hong Kong, China - Consumer Spending, HKDbn (2021-2026)

Hong Kong, China - Essential & Non-Essential Spending, HKDbn (2021-2026)

Hong Kong, China - Disposable Incomes & Consumer Price Inflation (2017-2026)

Source: National Statistics, Fitch Solutions

Source: National Statistics, Fitch Solutions

Source: National Statistics, Fitch Solutions

COMMITMENT TO QUALITY AND OUTSTANDING CRAFTSMANSHIP

Winning the Interior Design award for 18 years in a row, Archikris Design is at the top of its game. The design firm is famous for its magnificent craftsmanship and outstanding design intuition that exemplifies clients’ tastes. This is evidenced by the collection of stunning luxury residential and commercial projects for the likes of Escada, Max Mara, Carlsberg, Leica, and the Hong Kong Institute of Bankers.

Most recently, Archikris Design has expanded its ambitions outside of Hong Kong and into Japan, taking on a project in the resort town of Karuizawa, Japan.

Karuizawa is an upmarket mountain resort at the foot of Mount Asama in Nagano Prefecture. Located at a lofty altitude of roughly 1000 metres, the town provides a pleasant escape from the summer heat. It has been promoted as a mountain resort by Western residents of Japan since the late 1800s, and today many urban elites own a second home there. It is in this exclusive environment that Archikris Design made its international footprint.

The gorgeous hillside resort project utilises the natural sunlight from its floor-to-ceiling glass facade to showcase stunning artwork that sets a stark contrast to the teal-accented furniture. With panoramic views of the splendid natural mountains of Karuizawa, the design company has also designated natural elements of leafy foliage in the design to create a seamless theme of nature on the premises.

With Nison Chan at the helm of Archikris Design, he is the man who insists on perseverance on quality and reliability which is the key to the firm’s success. “I believe that it is our commitment to trustworthiness, punctuality,

quality craftsmanship and ability to stay within the budget that is the reason for our success.”

A problem with many interior design projects in Hong Kong is that the entire process involves several parties or, at the very least, a design firm and contractor, Chan offers a one-stop service that includes designers, architects and contractors to deliver a streamlined process. From design brief to completion and handover, his clients enjoy a minimum hassle, care-free service.

The prestigious firm takes pride in its close relationships with clients who keep coming back time and again, with returning clients and referrals making up most of its business.

Archikris’ luxury residential and commercial projects could range anywhere from 1,000 to 50,000 square feet, and amongst them are elegantly architected residentials in areas such as individual houses on the prestigious Middle Gap Road in The Peak, One Beacon Hill in Kowloon Tong district, as well as the prestigious Bamboo Grove on Kennedy Road in Wan Chai.

Middle Gap Road is amongst the most expensive addresses in the world, with prices reaching HK$200,000 per square foot. It is where Hong Kong tycoons and C-suite executives of global conglomerates such as HSBC like to reside.

The Bamboo Grove project entrusted to Archikris was a large-scale rejuvenation project for the prestigious housing estate where Chan and his team refreshed and restored over 100 units for a grand total of

PHILOSOPHY

FAST FACTS

• Archikris Design Group predominantly focuses on sizeable luxury residences with an average size of more than 2,000 square feet. Its work signifies the essence of opulence.

• The practice adheres to its core values of integrity, punctuality and budgetary control which contribute to keeping its list of heavyweight clients coming back.

• The Archikris team is straight with using high-quality materials from around the globe whilst maintaining price transparency.

This page: Leica headquarters, Carlsberg headquarters, Private residence Middle Gap Rd, Karuizawa resort

Opposite page: Max Mara store

approximately HK$50,000,000.

Most recently, the illustrious design firm was invited by the Hong Kong SAR government for a design project for their offices in Kowloon Bay. Further reiterating the solid reputation that Chan has built and maintained over the years and the trust that even the public sector has come to rely on.

This reputation carries on into the private sector where Archikris was appointed to design the interiors of distinguished luxury fashion label Max Mara’s flagship store as well as the headquarters of erudite camera brand Leica and worldwide beer brand Carlsberg.

When asked what’s ahead for the award-winning design company, Chan promises to continue the best practices that have built the firm’s infallible reputation. “We will continue our commitment to trustworthiness, punctuality, quality craftsmanship and budget consciousness to serve our existing and future clients.

Quality and punctuality underpin the company’s ethos and premium service that every client is guaranteed.

WHEN AV CONSULTANT MEETS SMART HOME SYSTEM

In today’s tech-savvy world, transforming homes through state-of-theart smart technology requires experience, specialised skills, and smart planning to meet customers’ high end creative expectations.

For AV Consultant Director, Alan Lee originally from RTHK (Radio and Television Hong Kong), has been in the forefront of providing high-end audio visual (AV) and Smart Home systems that cater to the needs of professional, commercial, and residential customers who seek to elevate their audio-visual experiences.

By using and integrating a variety of different types of AV/Smart Home systems, AV Consultant delivers the highest quality bespoke solutions to fit the most discerning customer.

Alan Lee Spearheads Smart Technology into the Future

Alan’s professional training in the broadcast industry became an asset for communicating with his target customers. Along with his professional team, the company has an advantage in understanding and communicating with customers compared to the usual technical guys who talked more in technical jargon.

His experience at RTHK also taught him how to hold reliability at the highest standards. He emphasises that AV Consultant’s dedication to service and quality does not simply stop until the job has been fulfilled. As their business delves into the client’s most personal space, reliability becomes an important fundamental aspect of the company’s service and product quality.

“What I learned from the radio station, it’s all about the precision,

everything must be very well prepared, very precise.” Alan added that this dedication to both reliability and precision has helped them squeeze out the best performance from the systems they offer, as they calibrate each one to tailor-fit the customer’s needs and expectations.

With reliability and precision, Alan made sure that AV Consultant stands out from their competition as they aim to provide only the best in terms of products and services. He states that their efforts in precise calibration and reliability testing during production has come from the professional standards set by UK and US.

AV Consultant’s Edge over the Competition

The company’s extensive knowledge on different AV systems have given them an advantage in catering to different requirements, from simple home karaoke to high-end executive video conferencing systems. By providing various smart solutions to customers and becoming a unique one-stop shop from purchasing to installation to calibration, AV Consultant optimises the customer’s experience from the systems without having them to worry about the intricacies of having AV/Smart Home systems.

AV Consultant’s work is also recognised by industry giants such as Dolby, Samsung, Panasonic, and Sony. The company has been commissioned for specialised projects such as installation and calibration for showrooms and demo facilities. Alan also appeared as guest speaker for various press conferences and gave numerous lectures to AV media and end users.

“I was also a programmer at the early stage of my career so I have

Outstanding Enterprises

PHILOSOPHY

FAST FACTS

• 2013 – GDC (Largest Cinema Server Provider in Asia) Home Cinema Demo Room (Design and Installation)

• 2017 – Centaline Property Club House in Causeway Bay and T.S.T (Design and Installation)

• 2017 – Dolby Laboratories ATMOS Demo Facility (HK Stadium)

• 2019 – Big Wave Bay Road Luxury Residence (AV/Smart Home System)

• 2021 – Goldsmith Road Luxury Residence (AV/Smart Home System)

• 2021 – D-BOX Motion System (Asia Distributor)

• 2021 – CK Asset Holdings (Club House, 21 Borrett Road

This page: Home Cinema with Professional Equipment and Performance, Concealed Surround/ Karaoke System (Club House, 21 Borrett Road), Concealed Surround/ Background Music System (One Oasis, Macau)

Opposite page: Alan Lee, director of AV Consultant (Int’l) Limited

good knowledge of both the AV and IT systems which are a very good combination to have since most of today’s AV systems run through a computer based and IT infrastructure,” commented Alan.

By bridging the gap in service between IT and AV system providers through their one-stop shop service and delivery, AV Consultant has oneupped their competitors with their integration of IT and AV systems.

Thanks to the variety of installation techniques and specialised products, AV Consultant’s products blend into the client’s environment, and helping to preserve the interior design without compromising the sound and visual quality from their high fidelity AV equipment.

Despite the impact of the Covid outbreak across industries, AV Consultant was spared from most of the detrimental effects due to the project-based nature of their work which sometimes can take up to a year or more per project. A testament to the company’s long-term commitment and dedication to provide uncompromising quality in terms of services and products.

“Most of our customers, you can say are from referrals. These referrals may be from the client or their friends, architect, interior designer, or the large contractors,” remarked Alan, adding that AV Consultant is happy and proud to gain high value trusting customers over the years through positive referrals. “We use little to no general promotional campaigns to build our business and grateful to our customers for their trust and loyalty to our company.”

Another example of AV Consultant’s innovation in AV/Smart Home Management is illustrated by the pandemic’s crippling of on-site repair and maintenance. Since site visits could not be done due to health protocols, AV Consultant’s remote support system is able to monitor various sites and maintenance becomes an easy-fix, even from the client’s end. With the company’s experienced technicians to remotely diagnose, faulty equipment

can be identified and simple instructions to the client can help solve the problem thus giving them a peace of mind.

People first, Business follows

For a small company who employ less than 20 people, Alan’s reputation as an AV/Smart Home specialist and his modest approach of eliminating a “specialised” salesperson provides customers the assurance they need with direct access to the experts handling their AV/Smart Home Systemfrom planning, designing and installation, they are all professionals who are competent, knowledgeable, and reliable.

“Unless there are serious performance issues, we don’t lay off people easily because I think the most important asset in a business are the people,” said Alan, emphasising that although it takes many years to find and train the right people, the investment eventually pays off.

As with many sectors, the AV/Smart Home industry is finding it challenging to recruit the right people since it is a niche industry that only a handful number of skilled professionals can do, and those skills come in after years of experience.

Alan wants to nurture and train the youngsters who have an interest in AV/Smart Home to join the industry. It’s really an eclectic industry from design, programming, project management to communications. Tutelage under Alan would definitely be an enriching experience.

AV Consultant has sailed over time because it constantly explores new options on meeting customer requirements and pioneering ahead to find the highest quality products and services. The company eliminates the ambiguity and hassle that customers have to deal with when picking the right AV/Smart Home system by providing simplest operation and the highest reliability.

Outstanding Enterprises

REACHING NEW HEIGHTS WITH AXA HONG KONG AND MACAU

Apost-pandemic world has pushed both companies and technology to evolve and adapt at such an accelerated rate that many have struggled to compete, let alone thrive. AXA Hong Kong and Macau (AXA), however, managed to weather the storm and came out on top, winning at the High Flyers Awards 2022 presented by Hong Kong Business.

In an interview, Gary Ho, Chief Technology Officer at AXA Hong Kong and Macau, he shared his thoughts on how technology powers business transformation in the post-pandemic era.

Navigating through uncharted waters

Being engaged for over 2 decades and having leading roles in multiple insurance companies, Gary has also been taking the lead in developing enterprise solutions architecture for different insurers.

“I have formulated IT strategies and driven multimillion-dollar transformation projects in insurance firms,” said Gary, adding that changes in enterprise architecture are unavoidable with digital transformation initiatives, with these initiatives helping him understand how positive impacts can be created with technology properly used by commercial players.

The COVID-19 pandemic has expedited digital transformations, with many companies starting to speed up their technological initiatives in order to stay competitive. With the younger generation now requiring digital engagement, such as the use of mobile applications and chatbots, companies would have to adopt omnichannel strategy to fulfil the needs of different generations.

Data platforms have had to accommodate external and unstructured data as well as big data, which facilitate the establishment of nextgeneration platforms capable of supporting disruptive products. This data is collected and stored through cloud capabilities with artificial intelligence and machine learning, analysing data to aid business decisions such as the course of action or offers.

In a new era where technological capacities bring opportunities for companies, traditional data is not enough to support a growing ecosystem. External parties such as insurtech firms and digital partners is essential to fill in the gaps. Data has become a core asset in the digital ecosystem where ecosystem partners to share and leverage data to spark innovation.

Digital transformation towards success for AXA

AXA continues to strengthen their strategic ecosystem, which empowered by integrations with strategic digital partners, as most of the insurance companies underwent drastic digital transformation journeys.

AXA also focuses on fostering existing life-long partnerships with customers, taking care of their everyday needs, not only for life and health protection, but also extend to travel, property and transportation.

With 360-degree lifestyle protection available for customers, AXA is able to capitalise on new digital opportunities and make use of their partners’ networks for up-selling and cross-selling, which has raised customer effectiveness successfully. With the support of partners’ digital assets, it helps

PHILOSOPHY

Our purpose is to act for human progress by protecting what matters. All employees in our organisation share the same goal of being a lifetime partner of our customers by providing humanised services and solutions to them.

FAST FACTS

• AXA Hong Kong and Macau is a member of the AXA Group, a leading global insurer with presence in 50 markets and serving 95 million customers worldwide.

• Our goal is to be the insurance and holistic wellness partner to the individuals, businesses and community we serve.

• At the core of our service commitment is continuous product innovation and customer experience enrichment, which is achieved through actively listening to our customers and leveraging technology and digital transformation.

us gain valuable insights and identify customer needs.

“I always encourage my team to have a start-up mentality,” added by Gary on how the company strategies drive success and foster a culture wherein the team builds confidence to take risks by experimenting with new things on the market. Team members should collaborate to build a technological vision that aligns with the company’s core values, striving for a positive outcome.

Gary has also shared his vision to steer the organisation away from any ambiguity during the digital transformation whilst also keeping the project on track by proactively involving stakeholders and key parties.

For AXA, cloud-agnostic strategies leveraged the best capabilities from each solution in the industry considering that IT firms or departments now act as a consultant, offering advice and co-working with business departments to drive faster and better solutions driven by technology.

Within the company, collaboration between the business and IT has resulted in technology being applied properly to achieve desired business results and aid business strategy. The acquisition and retention of talents with the right skill set and technological capabilities have been instrumental in AXA’s digital transformation, as the upskilling of employees has helped them keep their momentum and passion to overcome new challenges.

“We adopt a multi-cloud model with inter-cloud in order to combine both and create a seamless mass network for all our applications,” said Gary, adding that the model can be leveraged to extract the best of each cloud solution and support business growth in the long run.

A multi-level cloud programme is also being implemented in AXA to facilitate cloud adoption within the company to utilise cloud of all applications in Hong Kong.

Using their advantages to overcome challenges

As the insurance industry faces a collective challenge in dealing with legacy systems, companies found themselves against highly complex end-to-end modernisation and transformation programmes.

Upfront alignment on the roadmap and framework is critical in

seeing any impact across numerous business teams and clients, to ensure consistency across the individual workstreams. During the process of modernising these legacy systems, minimising the business disruption, ensuring the result is as desired, clarifying workflows, and potential enhancement remained the biggest challenges as the complexities inadvertently created by legacy infrastructure left many holes to be plugged.

Changes in a system cannot be easily applied as well due to the fact that they are tightly integrated, which would result in ripple effects across different systems. In order to overcome the potential challenges, Gary states that they have established solid incremental processes that follow the critical business triggers in different stages and strive for successful legacy modernisation with minimal business disruption. “The way we tried to minimise the impacts is to build and align our modernisation framework prior to any implementation,” he commented.

AXA focused on multi-cloud implementation despite the initial set-up cost having the potential to get out of hand given the company’s size in order to capitalise on what is perceived to be the trend of the future. To combat this possibility, phase cloud migrations were implemented wherein the relatively straightforward parts of AXA’s data centres are migrated to the cloud first, in a bid to avoid the heavy costs of replacing them all at once.

AXA’s future with technology

The company plans to further enhance their microservices and improve its agility on launching new products and enhancement by using CI/ CD pipeline to minimise business disruption. They also aim to migrate existing legacy systems and infrastructure bit by bit once the digital platform is enhanced.

For Gary, digital transformation is an ongoing and constant process, one that requires proper oversight in order to achieve their objectives of strengthening their digital ecosystem and dedicating more resources and time to create value for all through customer experience enhancements.

Opposite page: Gary Ho, Chief Technology Officer, AXA Hong Kong and Macau

Outstanding Enterprises

A GREENER FUTURE WITH DATA SCIENCE THANKS TO AXA HK AND MACAU

Nowadays, consumers have greater demand of ESG elements from businesses, whilst many corporates have been developing different initiatives to move closer to their green goals. Such was the case with AXA Hong Kong and Macau, who recently launched their “Energy Saving Campaign” – a GO GREEN home insurance campaign that aims to inspire and encourage customers to go green.

Elaine Chan, Data Science and Management Director at AXA Hong Kong and Macau, who won the Insurance - Big Data Award at the 2022 High Flyers Awards presented by Hong Kong Business this year, also drove this trailblazing campaign to build a greener future. During the interview, she shares her thoughts on the importance, challenges, and successes of AXA’s GO GREEN home insurance campaign.

The woman behind the successful use of data science in AXA HK and Macau

With over a decade of experience in the data science for insurance, Elaine sees the trend that most companies are either pioneers in data science adoption or market share titans, but never both.

“As an industry leader who has high demands in data - both in acquiring the data and in turning them into valuable action - AXA is one of the few exceptions, and I’m happy to work in such a renowned

insurer as there’s a lot that I can do,” said Elaine, adding that data science has been a relatively new, granular specialisation in the industry.

In her early career, data science in the form of predictive modelling, and machine learning were still very young with businesses at that time, rarely did they adopt such innovation. With scepticism on the value and capabilities of data science, Elaine sees the value of a successful data science business application, aside from just technical glamour. This helped us to shape the data science work that takes place within AXA, which focuses more on the delivery of commercial and meaningful applications for the customers and the company.

AXA leading the fight against climate change with data science

Back in December 2020, the AXA Group announced its strategic plan of “Driving Progress 2023”, reaffirming the company’s positioning in the climate leadership, as a part of their five key strategic actions. Ever since then, AXA Hong Kong and Macau has been innovating on a handful of climate-related green campaigns, driving the needs for literature review, data investigation, and qualitative research amongst different teams such as pricing, claim, and underwriting. The collaboration between the data science team, P&C pricing team, underwriting team, and claims

PHILOSOPHY

Be a BetterMe, for our better future.

FAST FACTS

• In June 2022, 39 AXA entities across the world got together to support the annual “AXA Week For Good” on sustainable and inclusive actions

• AXA Hong Kong and Macau is the first insurer in Hong Kong to join the MasterCard Priceless Planet Coalition

• AXA Group continues to increase the volume of its green investment. From €12b in 2019 to €16b in 2020 and should reach €26b by 2023

This page: Go Green Banner

Opposite page: Elaine Chan, Data Science and Management Director, AXA Hong Kong & Macau

team has been essential in model development.

The insurer’s green score generator which uses both open data and internal data to perform big data techniques and hypothesis testing , has been instrumental in the release of the ESG-related home insurance campaign with eco-friendly features, aiming to encourage consumers to combat climate change and raise the awareness on environment protection.

With big data evolving at break-neck speeds every day, the right selection of data sources and data fields for solution development stands as the key to success, no matter the volume size or source variety.

The biggest obstacle remains to be determining the right open data source, which brings value to formulated analyses. The data pattern of machine learning, the myriad of various data fields from external and internal, remains critical for any hypothesis and determining quality of the built predictive data model.

With their own big data and data science practice, AXA was positioned to further drive their sales and innovation in the insurance landscape. “Data is now a new oil that is an essential component for all industries nowadays,” commented Elaine. She added that there are now a lot more data touch points between customers and insurers because of digital applications.

By leveraging the growth of big data, insurance companies can now understand more about our customers’ purchase behaviour, protection needs, and distribution channel preference, amongst other things. These insights can help us to tailor make product offerings to

meet customers’ needs.

“In fact, our customers are also aware of the use of data nowadays, and they even have higher expectations and greater demand on how to offer them the best product by utilising their data,” said Elaine.

By using the power of external data, advanced data modelling and risk pricing, AXA’s green score predictive model allows internal stakeholders to develop more precise pricing for home products or premium discounts, whilst rewarding consumers for their climatefriendly behaviour. AXA’s studies have also identified the impact of weather factors in claims and emitted the embedded green effect in the pricing model, resulting in better pricing that takes environmental friendliness into account.

AXA is committed to build a healthier planet, hence, we raise the awareness of go green, and encourage our customers to lighten their carbon footprint together.

“This serves as a foundation on how we will evolve and innovate our insurance products by using dynamic pricing to incentivise climatefriendly actions,” commented Elaine.

“Energy Saving Campaign” – a GO GREEN home insurance campaign is AXA Hong Kong and Macau’s first key milestone in integrating open data, advanced data modelling, and risk pricing into a new proposition, the company aims to explore more possibilities of new open data sources that are environmentally-related, in order to develop new scientific ways to support claims risk management and underwriting process automation.

AXA’s strategy to reduce climate-related risk is not only driving corporate Green initiatives, but also inspiring customers to kickstart their Go Green journey.

BRINGING IN THE HIGHLANDS WITH CLANSMAN LIFESTYLE

Introducing a new cultural lifestyle brand into a vastly different demographic can prove to be difficult, as some parts of the culture may get lost in translation when it is being endorsed to another cultural group. Such was the case that Clansman Lifestyle found themselves in, but despite the challenges, they have found success in selling the Scottish lifestyle to customers in Hong Kong.

Founded back in 2020 by husband Derek and wife Evon Wyllie, Clansman Lifestyle, a brand name operates under LOOC Limited. The couple leverages Derek’s retail and distribution background coming from corporations like Adidas and Evon’s legal background in financial institutions founded their base in Hong Kong with Evon as the Chief Executive Officer given her multi-cultural heritage and drive in business. With Hong Kong as their launching pad, the couple is looking at APAC as a growth region with the Greater Bay Area closely on their expansion radar. Currently, Clansman Lifestyle is actively distributing in Hong Kong and Macao. New Yaohan is Clansman Lifestyle’s first working partnership in Macao. Other than physical stores presence, the company’s cross-border e-Commerce platforms also reach out to South East Asia jurisdictions such as Malaysia and Singapore.

By properly mapping out the company’s vision, goals, operation, and branding with strategic planning, corporate training, experiences, and foresight, Clansman Lifestyle distinguished themselves by winning the Natural Lifestyle Award at the 2022 High Flyers Awards presented by Hong Kong Business.

In marriage and in business, the couple found success Stemming from her stint as a stay-at-home mum, Evon has been fond of incorporating natural products into her daily routine, be it food, drinks, clothes, detergents, or skincare, and this has extended to the products that they offer. With Derek’s Scottish heritage and Evon’s passion for everything Scottish as well as their exposure in the corporate world, the couple were able to form strategic partnerships with local companies as well as recognition by various organisations which have helped them during the establishment phase of Clansman Lifestyle.

One of the strongest partnership the couple has forged was a Hong Kong local logistic company with 200 employees which supports Clansman Lifestyle’s logistic and warehousing needs covering both online and offline businesses, B2B, B2C, import-export operations of the company.

Clansman Lifestyle currently represents 7 Scottish brands exclusively in Hong Kong. In addition, Glencraft Hong Kong, a 177 year Scottish handmade mattress brand with Royal Warrant by the late Queen Elizabeth, is also working closely with Clansman Lifestyle in promoting Scottish cultures in Hong Kong. Clansman Lifestyle products are also on offer at Glencraft’s showrooms in Hong Kong and Macao.

Despite starting at the height of the COVID outbreak, the company was able to respond to market changes quickly and showed flexibility in delivering quality products and services. Throughout the pandemic, Clansman Lifestyle was quick to form strategic partnerships, adapt their operations and flexible in changing their course to survive new market conditions and customer expectations.

Outstanding Enterprises

PHILOSOPHY

A slice of Caledonia in Hong Kong

Clansman Lifestyle quickly establishes itself as a Scottish cultural ambassador in Hong Kong, unravelling the rich historical history and cultures the Scotts had left behind in Hong Kong during the colonial time highlighting the many establishments such as HSBC and Jardines were established by the Scotts. In fact, many famous road names in Hong Kong such as Lockhart Road, Edinburgh Place, Wylie Road, and Argyle Road all bear Scottish origins.

Scottish culture runs deep in Hong Kong history, as the famous Jardine’s Noonday Gun came from the Scottish business family. Hong Kong has two tartans registered with the Registrar of Tartan of Scotland, with one being for the University of Hong Kong and another one being inspired by Hong Kong’s well-known red, blue, and white tartan pattern.

Besides the heritage factor, Evon markets Clansman Lifestyle with what Scotland currently has to offer, an unpolluted heaven. She emphasises this for the two body care brands she carries (Arran Sense of Scotland and Scottish Fine Soaps) highlighting that unpolluted water sources used for making Scottish whisky are also being used for making skincare products.

Another notable brand which the couple carries is ANCO Natural Dog Treats, a Scottish brand first in the world to offer tree root as dog chew is also currently the biggest natural dog treats company in the United Kingdom. This brand leads the market by offering unadulterated dog treats as well as incorporating superfood ingredients into their products. Products rarely seen in this part of the world would be Camel Tripe, Goat Tripe, Chia Seed Oil, Hemp Oil, coconut oil infused bullychew. With the couple’s love for dogs, Evon next frontier is to turn Hong Kong into a super pet-friendly city.

Clansman Lifestyle’s products have sustainability at their core, given the company’s focus on providing a natural lifestyle, and this complements their initiative to identify products that they will carry as they need to have

NATURAL LIFESTYLE AWARD

FAST FACTS

• From popups to hotel experience retail, Clansman Lifestyle lauded itself as the first retailer who sells food in a washroom (tongue in cheek). Clansman Lifestyle was being selected by Mandarin Oriental again to occupy a whole suite where it presented a list of carefully curated lifestyle and luxury brands to showcase during the exquisite three days event.

• Evon Wyllie has been appointed by Scottish Business Network as their Ambassador in Hong Kong. The formal announcement would be made in January 2023.

This page: Clansman Lifestyle Homestore in Hong Kong, ANCO Natural Dog Treats’ product

Opposite page: Evon Wyllie, Chief Executive Officer, Clansman Lifestyle

heritage, sustainability, corporate social responsibility, love for nature, and everything pure and unpolluted.

Challenges and opportunities for Clansman Lifestyle

Some of the challenges that the couple faces in ensuring the success of their company comes from the fast-paced lifestyle and multiple sensory stimulations that urban dwellers are used to, making natural products a hard sell. The company aims to educate the public on slowing down their lifestyles to explore quality products and the benefits of quality products over cheap products filled with undesirable components.

Supporting partners brought in by Evon has offset the high cost of operation for the company in Hong Kong, outsourcing many of their operations such as IT and digital marketing, allowing Clansman Lifestyle to focus their efforts on reaching out to customers.

The couple first started their business with only just two IKEA shelves at Cochrane Street, Central Hong Kong in 2020. The following year, they committed to a month rental of a ground floor shop over the Christmas period to create brand awareness. On their third Christmas, they had been chosen by Mandarin Oriental Hong Kong as a participating merchant for their yearly Luxury Lifestyle Event where Clansman Lifestyle curated a list of other noteworthy brands to retail side by side with them over the three day one-of-a-kind retail experience targeting the upper crust of Hong Kong society. Clansman Lifestyle also operates in various other five-star hotels and clubs in Hong Kong. It has been the company’s philosophy to discourage hard sell culture at retail, instead focusing on offering the public a relaxing shopping experiences.

In the near future, the company aims to create a platform between Scotland and the Far East, building upon their working relationships with Scottish principals to bring into APAC more natural products to meet the demand for pure and unpolluted products as well as lifestyle.

Clansman Lifestyle aims to be a Scottish cultural ambassador, introducing Scottish culture to Hong Kong whilst uncovering and deepening Hong Kong-Scotland relations by highlighting the Scots’ contributions to Hong Kong history and society

Outstanding Enterprises

ESTABLISHING NEW STANDARDS WITH NANHAI NO. 2

Renowned throughout the world for its excellent restaurants and fine dining, Asia is the the next target for Elite Concepts, aiming to fill a market niche for high-quality independent dining and entertainment venues catering to a younger, more sophisticated clientele.

Established in 1991, the company and its founder and executive director, Paul Hsu, have devoted their time towards understanding all aspects of the hospitality industry and absorbing each country’s unique culture to formulate an authentic and luxurious experience for every guest.

For the past 30 years, Hsu has pursued the vision of a luxurious dining and entertainment establishment, leading to the company becoming one of Asia’s leading hospitality management and consulting firms and winning the Innovative F&B Concepts Award at the 2022 High Flyers Awards presented by Hong Kong Business.

Innovative and luxurious dining with Elite Concepts

The company boasts a healthy portfolio of innovative and timely dining concepts ranging from American Country, French Provençal, Rustic Italian, Slick Japanese, and Retro-Vietnamese, providing a breath of fresh air to Hong Kong’s favourite dining and entertainment districts since the 90s such as Lan Kwai Fong and Knutsford Terrace.

Well-known as one of Asia’s most innovating, leading hospitality groups from its various restaurants in Asia and their habit of constantly planting fresh ideas that can become tomorrow’s hospitality trends, Elite Concepts continues to build upon their portfolio by adding more innovative ideas and leveraging available advantages to further exemplify their services and customer experience.

In an industry where competition is intensely cut-throat, distinguishing a company from the sea of competitors requires the ability to adapt to changing market needs and trends.

In order to find potential markets, expand their existing clientele base, and achieve success, Elite Concepts developed the “yè shanghai” concept, working together with synergy partners and paving the way for a new direction for the company.

The “yè shanghai” concept has demonstrated its capability in expanding towards other lifestyle hotspots in the world, having set up in a number of locations such as Shanghai, Hong Kong, Kowloon, and Taipei.

With this versatility, the company is further developing a diverse portfolio of restaurants as well as bars and clubs in Hong Kong, China, and Taiwan with the potential to branch out towards Berlin and New York.

Other successful concepts from the company include Nanhai

INNOVATIVE F&B CONCEPTS

PHILOSOPHY

Inside the minds of Elite Concepts staff are a wealth of ideas which will grow into tomorrow’s hospitality trends. We are experts at seeing the potential in new ideas, and making the most of that potential.

FAST FACTS

• Since its inception in 1991 with the aim to fill a market niche for highquality free-standing restaurants, Elite Concepts has evolved into a dynamic enterprise with the capability to transform visionary ideas into commercial successes.

• Over the years, it has developed a diverse portfolio of restaurants, bars & clubs in Hong Kong, China, and Taiwan.

• Elite Concepts restaurants including yè shanghai, Nanhai No.1 and No. 2, eyebar, Deng G and Deng G @ K11 Musea are all widely acclaimed for cutting-edge interior design, and famous city panoramas, each with a story of its own.

• With market sensitivity, attention to details, sound management, and solid expertise, Elite Concepts will continue Defining Asian Hospitality in the years to come.

No. 1 and No. 2, eyebar, K BAR, Deng G, Deng G @K11 Musea, Duck de Chine, and 1949, all providing distinct yet magnificent dining experiences for guests with their impeccable interior design and famous city panoramas.

Setting course towards an open sea of flavours with Nanhai No. 2

Nanhai No. 2 in Causeway Bay is the company’s most recent success, opening up a new dimension of tasting possibilities from across the South China Sea and beyond for many guests. The restaurant is now located at The World Trade Centre, Causeway Bay, moving from its previous anchorage of Victoria Harbor.

Illustrating the classic elements of a deck with the blessing of the panoramic Victoria Harbour View.

Aside from that, a different kind of vessel in the form of a wine cellar, Brixy, housed inside a contemporary reefer container displaying over 150 labels and storing 1,000 bottles at 10ºC with perfect humidity control can be found to the right of the lobby, allowing wine enthusiasts to enjoy their offerings all-year round.

As the centre of attention in any restaurant, Elite Concepts fine-tuned the dining area to provide two distinct experiences

This page: Dining Area, Main Dining Area, eyebar

Opposite page: Antonio Chan, General Manager of Nanhai No1 and No.2

between the main dining room and four privileged private rooms, with two private dining rooms, 1 Malacca and 3 Ceylon, offering exclusive privacy whilst opening guests onto glorious views from across the harbour.

Dining rooms 5 Persia and 7 Mecca can accommodate up to 60 diners across 5 tables, whilst the main dining room features state-ofthe-art conference facilities which makes it a suitable events place for corporate events and private parties.

Charting new waters and opportunities in the future Elite Concepts aims to achieve their goal of delivering the ultimate guest experience, as the fast-growing hospitality group has launched their very successfuul, first loyalty mobile application named ELITE Acess that rewards customers with exclusive perks and offerings from their restaurants and bars as they enjoy and dine across multiple locations.

The company displays extreme attention to details, sound management, and solid expertise along with market sensitivity, lending them to continue on their trailblazing path to become a dynamic enterprise with the capability to transform visionary ideas into commercial successes.

BUILDING BETTER FINANCIAL FUTURES FOR OUR CLIENTS

With over 50 years of global investment management experience across 25 locations worldwide, Fidelity International has offered retail, and wholesale clients a wide range of products and services, including MPF and ORSO schemes, personal investing, and mutual funds. As one of the largest retirement asset management firms in Hong Kong since its establishment in the city in 1981, the Fidelity Retirement Master Trust has garnered the “Gold Rated Scheme” from an independent third-party rating agency for ten consecutive years.

With their continued success, 40 years of ceaseless commitment, and their ever-evolving offerings and aspirations, they managed to win the High Flyers Award presented by Hong Kong Business, with Charlotte Chan, Head of Distribution, Hong Kong Workplace and Personal Investing at Fidelity International, sharing her thoughts on how Fidelity keeps succeeding and what the company plans to undertake in the future.

Mobilising history with strategic thinking

Developing a career in the investment industry has made Charlotte see the value investment brings to building better financial futures and achieving different life goals. As a leader in the industry, Fidelity supports retirement planning and the financial wellness of both their employers and members, as retirement planning is a gradual process that takes time and ideally should be managed throughout the entire working cycle. Understanding the strategic importance of Hong Kong as a key global financial hub and a

gateway to mainland China, Fidelity invested in their capability to support the needs of the Greater Bay Area (GBA) through the Wealth Management Connect scheme which provides more options for investors seeking diversified solutions and compliments Fidelity’s existing product set.

A year of continued success for Fidelity

Being one of the largest MPF scheme providers in Hong Kong, Fidelity has always recognised the city’s growing ageing population and the demand for post-retirement solutions to accommodate MPF members’ needs to generate stable retirement income. Capitalising on this opportunity for both the firm and scheme members, Fidelity launched MPF Flexible Retirement Solution, providing customers with comprehensive products and services that help them plan and achieve their desired retirement life.

“With the growing ageing population in Hong Kong, the financial wellbeing of retirees in the city is a key consideration for our innovation plan,’’ said Charlotte, adding that this initiative was supported by an extensive communication campaign that aimed to familiarise the general public on holistic post-retirement solutions and their significance.

In order to maintain asset purchasing power in the long-term for members and protect the investment of their assets against inflation, Fidelity rolled out a diversified mixed asset post-retirement investment solution to achieve a stable overall return, higher than Hong Kong inflation over the course of MPF members’ retirement journey.

Outstanding Enterprises

PHILOSOPHY

FAST FACTS

• More than 50 years of global investment management experience, with our services reaching customers in over 25 locations worldwide

• Active in Hong Kong since 1981, offering retail, institutional and wholesale clients a wide range of products and services, including MPF and ORSO schemes, personal investing and mutual funds

• One of the largest retirement asset management firms in Hong Kong, servicing to both MPF and ORSO schemes

• Fidelity Retirement Master Trust was awarded the ‘’Gold Rated Scheme’’ for ten consecutive years by an independent third-party rating agency

This page: Fidelity Pension Event 2022, Fidelity Global Market Outlook Media Event

Opposite page: Charlotte Chan, Head of Distribution, Hong Kong Workplace and Personal Investing at Fidelity International

“Our investment experts [are] actively allocating riskier and defensive assets, with the aim to seize potential investment opportunities and help mitigate market risk through dynamic asset allocation,” commented Charlotte, adding that they have leveraged technology and digital capabilities to introduce their first-to-market MPF e-withdrawal platform for retirees and soon-to-retire MPF members.

With this platform, members can manage their investments and withdrawals easily throughout their retirement period, and enjoy the flexibility to stay invested in a familiar scheme; continued investment growth potential is sustained despite the withdrawal of retirement assets in preferred stages.

An easy-to-use and useful online tool named the “Retirement Withdrawal Planner” was also introduced to help members envision their future account balances at retirement age and suggest optimal regular withdrawal amounts to increase the longevity of retirement savings.

Fidelity and the growing importance of ESG initiatives

Sustainability is at the heart of Fidelity’s identity and operations. As a responsible investor, Fidelity is committed to Net Zero as a business by 2030 and across its portfolios by 2050. The company’s approach and commitment to making a real-world impact on behalf of clients and investors to sustainability rest on three pillars, namely

Integration, Engagement and Collaboration.

Industry-wide initiatives require a great amount of collaboration in order to compel the world’s largest corporate greenhouse gas emitters to take necessary actions towards addressing climate change. Fidelity is currently a member of multiple collaborative industry initiatives such as the United Nation “Principles for Responsible Investment”, Carbon Disclosure Project, Climate Action 100+ and Net Zero Asset Managers Initiatives.

Moving forward

At Fidelity International, building better financial futures for clients is the core vision. “We are committed to helping people achieve and stay in great financial health throughout every stage of their lives,” remarked Charlotte. With eMPF on the way, this is going to be a multi-year tech-enabled transformation journey. eMPF Platform is a major infrastructure that will reshape the administrative models of MPF schemes and is set to standardise, streamline, and automate the existing scheme administrative processes. According to Charlotte, Fidelity will collaborate with the Trustee and the centralised platform provider to ensure a smooth transition. This will also provide Fidelity with an impetus to review its current offering and elevate different aspects of the business to strategically focus on leveraging the digital ecosystem, enhancing customer experience and refreshing product offerings to meet the evolving needs of MPF members.

By combining leading investment management capabilities, with personal investing and retirement savings platforms, we are working together to build better financial futures

Outstanding Enterprises

MORE BANKING OPTIONS WITH HANG SENG BANK’S OFFERINGS

Founded in 1933, Hang Seng Bank has continuously provided worldclass service and high quality offerings, being innovators in providing the best-in-class, customer-centric banking, investment and wealth management services for individuals and businesses.

Recognised as a leading domestic bank in Hong Kong with more than 3.5 million customers, Hang Seng Bank Limited wins the Global Banking Award at the 2022 High Flyers Awards presented by Hong Kong Business.

“Being one of the professional leading banks, we would continue to strive for excellence to our Corporate clients and deliver world-class service, as well as latest banking solutions to cope with this ever-changing financial markets,” remarked Rose Cho, Head of Global Banking and member of the Executive Committee in Hang Seng Bank.

Rose, who has over 17 years of experience in commercial banking, has led a five-year strategic plan, reshaped the corporate banking strategic vision and growth plans, and led the Hang Seng Bank’s Greater Bay Area strategic intent.

A better banking experience for customers and corporations

With the combination of its award-winning mobile app and strong digital capabilities in a network of over 270 service outlets in Hong Kong, Hang Seng provides customers a seamless omni-channel experience to manage their banking and financial needs anytime and anywhere.

Recognising that physical and digital worlds are blending together,

Hang Seng has leveraged the latest technology and innovation to enable customers enjoy a better banking experience as they further enhance their online-offline banking services and bring new opportunities from a virtually integrated lifestyle to customers.

Hang Seng’s Global Banking also offers tailored financial solutions to major corporate and institutional clients such as general banking, corporate lending, interest rates, foreign exchange, money markets, structured products, and derivatives. The bank uses a long-term relationships management approach to foster a fruitful working relationship between them and the client.

Personalised investment loan solutions are also available, along with digitalisation for investment and insurance with local stocks trading for investment accounts over digital banking and FX for investment that allows trading of FX products for investment purpose via investment channel.

Insurance sales have been made easier and better with tablet solutions that enable e-signature for insurance applications.

The bank has also delivered comprehensive cash management solutions to corporate clients complete with seamless integration with after-sales follow-up and reviews from dedicated sales managers. These staff members are all experts in their field, exercising mastery in Payment and Cash Management and possessing solid knowledge of Global Payments Solutions.

“Our success in delivering innovative, digital and automated industryspecific cash management solutions to clients across a wide range of

industries drove a strong year-on-year growth in total deposits,” stated Rose, adding that customers have benefitted from the speed and convenience of the bank’s cash management solutions, leading to more users in digital channels, particularly in their API solutions which are tailored to the specific industry needs of customers.

Their latest success comes from their industry solution to allow property developers to easily manage their payment, collection, and liquidity efficiently using the latest API solution for mortgage collection that offers real-time monitoring and shortens the collection cycle from a week to just a few minutes. The solution also offers security and helps property developers’ administrative teams avoid manual work in handling massive amounts of cheque payments and match cheque details.

Incorporating sustainability into global banking ESG initiatives and sustainability has risen in popularity as stakeholders and customers clamour for more sustainable business practices and environmentally-friendly products. To this end, Hang Seng has undertaken strategies and initiatives to achieve their ESG goals and help corporate clients in their journey as well.

Recently, they have diversified their loan portfolio into new economies such as logistics, data centres, and clean energy, aiming to accelerate the growth and adoption of more sustainable practices. Hang Seng complemented this with sustainability-linked financing, approving green financing which is three times more than that of 2021.

Structured trade solutions have also been accelerated and enhanced endto-end digital fulfilment captures customers’ trade finance needs.

With Hang Seng’s expansion of their deposit market share, they aim to drive green deposit in response to customers’ increasing ESG needs, as well

FAST FACTS

• Founded in 1933, Hang Seng is one of Hong Kong’s largest listed companies. Our market capitalisation as at 31 December 2021was HKD272.8 billion.

• The Bank serves over half the adult residents of Hong Kong – more than 3.5 million people – through around 270 service outlets. We also maintain branches in Macau and Singapore and a representative office in Taipei.

• Established in May 2007, wholly owned subsidiary Hang Seng Bank (China) Limited is headquartered in Pudong, Shanghai, and operates a mainland China network.

This page: Hang Seng Headquarters

Opposite page: Rose Cho, Head of Global Banking at Hang Seng Bank

as actively migrate counter transactions to digital channels.

“Hang Seng Bank aims to be a domestic leader in promoting green business and environmental stewardship. We support our corporate clients’ transition to a low carbon economy with sustainable deposit and finance solutions as well as ESG-focused investment choices,” said Rose.

The bank has also launched their latest Global Payments Solutions product, Green Deposit, that aims to provide clients with an active part in leading the path towards a greener future while they earn a fixed interest rate for time deposit. Deposited funds will be used to finance eligible businesses and green projects through lending solutions, contributing to a more sustainable future by channelling funds into projects that support green production and sustainable development.

The future for Hang Seng

“Our Aspiration is to be the preferred banking & financial services partner for Global Banking clients in HK and the Greater Bay Area,” commented Rose, highlighting Hang Seng’s efforts in deepening and enhancing GBA connectivity.

The bank has leveraged the close connectivity between Hang Seng and Hang Seng China (HACN) using strong management oversight over HACN to drive cross-border business, as well as on- and offshore synergies to explore business opportunities in the Greater Bay Area.

Hang Seng and HACN has used Global Payments Solutions in exploring the cross-border business with onshore and offshore clients, seeking out opportunities in Pan-China and enriching their product offering to wealth management customers to capitalise on opportunities and wider Greater Bay Area Initiatives.

INTO A SUSTAINABLE FUTURE WITH HYATT REGENCY HONG KONG, TSIM

SHA TSUI

Managing hotels and resorts during the pandemic has been a monumental task for hoteliers, weathering little to no influx of guests for days. With pandemic restrictions slowly receding around the world, new opportunities have sprung up for the hospitality establishments that have managed to survive.

Mr Per Kredner, the current General Manager of Hyatt Regency Hong Kong, Tsim Sha Tsui used his vast experience to steer the establishment towards success and thrive amidst the challenges, and with their future plans to further incorporate ESG initiatives into their operations, have won at the High Flyers Award presented by Hong Kong Business.

The man behind every step

A professional and distinguished Swedish hotelier, Mr Kredner has mastered his expertise in managing hospitality establishments for over 15 years across a wide array of locations such as Dubai, Muscat, Singapore, Shanghai and Tokyo. These years of experience also include food and beverage operations alongside hotel management, gracing a significant amount of properties in Asia and the Middle East, such as the prominent Grand Hyatt Dubai, Grand Hyatt Singapore, and Park Hyatt Shanghai.

Before joining as the General Manager of Hyatt Regency Hong Kong, Tsim Sha Tsui, Mr Kredner worked as Hotel Manager for Grand Hyatt Bali and Grand Hyatt Shenzhen in 2012 and 2014, respectively. With

strong leadership skills, his strategic decisions in hotel management and operations have helped him exalt himself from his peers with his appointment as General Manager of Hyatt Regency Hong Kong, Tsim Sha Tsui in 2016.

“I look forward to continuing to build upon this strong foundation and to creating enduring experiences for our guests and employees alike,” commented Mr Kredner, as his position has put him in charge of a prestigious establishment.

A better future with Hyatt

As a hospitality industry player, Hyatt’s purpose extends itself to caring for the planet with steps designed to help make an impact on future industry practices.

On the subject of carbon emissions and water efficiency, operational reports are used to effectively schedule heating and cooling needs, whilst electric steamers and heat pumps replaced gas steamers and boilers that have effectively reduced gas consumption by 20% and 68%, respectively.

Lighting in public areas of the hotel is partially switched off at midnight, along with air conditioning and lights in meeting rooms only when needed. Airconditioning systems have also been upgraded to be more environmentally friendly with the installation of a variable speed drive in chilled and condensing water pumps, which has reduced electricity consumption by 20% and greenhouse emissions by 17%.

PHILOSOPHY

Environmental footprint information can be made event-specific to align with the Hotel Carbon Measurement Initiative (HCMI) and the Hotel Water Measurement Initiative (HWMI) methodologies used by Hyatt’s management.

In the area of food and beverage, Hyatt’s Thoughtfully Sourced. Carefully Served philosophy guides the hotel to select ingredients that are better for people, communities and the planet.

Under Mr Kredner’s leadership, Hyatt Regency Hong Kong, Tsim Sha Tsui has focused more on acquiring locally sourced ingredients and seasonal items on the menu rather than importing products during the off-season in order to lessen their impacts on the environment, such as the cost of transportation and the logistics involved that generate a larger carbon footprint.

In this sourcing initiative, a heavy focus is on both small, local farms and ASC- and MSC-certified items from fish and seafood suppliers who source their products sustainably. That takes any endangered species off the table, as they are struck from the menu.

Water is served through carafes on default options for meetings and events, with refillable solutions for water being supported by self-service water stations for both guests and staff. Coffee has also been brewed in limited amounts to cut down on waste.

Hyatt has also been minimising any kind of food waste as they implement portion control through thorough and accurate headcount records for food preparation, tailoring offerings, and adjusting concepts for better management in production. The hotel has also partnered with Grow Something, a local social enterprise that will plant a variety of herbs with organic compost on-site, providing Hyatt’s culinary team with fresh herbs to be used in their restaurants whilst giving diners a unique farm-to-table experience.

FAST FACTS

• The hotel occupies Level 3 to 24 of the mixed-use complex K11 and sits atop K11 Art Mall

• Hyatt was founded by Jay Pritzker in 1957 when he purchased the Hyatt House motel adjacent to the Los Angeles International Airport

• The Hyatt Community Grants program works with Hyatt hotels and resorts all over the world to donate money to nonprofits doing important work in their communities. Since 2008, Hyatt has helped donate $5.3m to 300 deserving nonprofits in 52 countries.

This page: Herb Garden team (top), Regency Suite (bottom left), Regency Ballroom (bottom right)

Opposite page: Per Kredner, General Manager of Hyatt Regency Hong Kong, Tsim Sha Tsui

Hyatt Regency Hong Kong, Tsim Sha Tsui, is prestigious and in a class of its own

When the doors opened in 2009, the hotel sat right at the heart of Tsim Sha Tsui, a prime location with a business and tourist district and directly accessible by Tsim Sha Tsui and East Tsim Sha Tsui MTR stations. This location allows guests to travel around the city without hassle and provides them with numerous shopping options such as K11 Art Mall, the first of its kind that enhances dialogues between local artists and shoppers through integrated art concepts.

Aside from K11 Art Mall’s boutiques and restaurants, the hotel also offers an exclusive retail experience that brings art, people, and nature together. Different colonial establishments around the district are also open for tourists, along with other cultural establishments such as the Xiqu Centre, the M+ Museum, and the Hong Kong Palace Museum.

Offering 381 guestrooms and suites, with some having the harbour in view, state-of-the-art meeting and private dining facilities, and a pillarless ballroom along with five meeting venues of various sizes, Hyatt Regency Hong Kong, Tsim Sha Tsui has established itself and remained a popular hotel to leisure and business clientele, dining guests, events and wedding guests.

Various authentic cuisines with three restaurants and a bar, including Hugo’s, The Chinese Restaurant, Cafe, and Chin Chin Bar, are present within the hotel, reinforcing its reputation as a versatile establishment that can cater to any event.

“It is important to create genuine connections and truly understand our guests including our associates,” said Mr Kredner, adding that Hyatt looks after their people to enable them to become their best selves, as the human factor is the core essence to success as their business works toward providing the best experience for all involved.

Discover the perfect balance of comfort and convenience at Hyatt Regency Hong Kong, Tsim Sha Tsui

EXPANDING AND REINFORCING ITS CORPORATE PRACTICE

Mayer & Associés (MA) is a French Law Firm founded in Hong Kong in 2001. The firm specializes in the economic migration of companies from Europe to Asia Pacific, particularly China, and from Asia Pacific to Europe, particularly France. Our firm also provides expert legal advice to both corporations and individuals across a variety of dedicated practice areas.

Expanding

MA entered into an association with Tony Au & Co (a Hong Kong law firm) registered with the Law Society of Hong Kong on 13 May 2022. It is a natural development of the close, long-term cooperation between the two law firms in handling matters involving Hong Kong law and French law for clients in Mainland China, Hong Kong, France, and worldwide.

Reinforcing its corporate practice

Jérôme Latil joined MA as Senior Associate on 6 October 2022. With more than 20 years of experience in M&A and corporate law, Jérôme reinforces the legal team of MA. Eric Mayer, the Principal, and Sophie Cante, another Associate, both also practice corporate law and have experience in M&A.

Monitoring of new legislation

MA monitors closely any new legislation having an impact on its clients and takes any appropriate action in relation thereto. New legislation having an impact on protecting directors’ personal information came into force in 2021 and 2022. MA promptly informed all its concerned clients and subsequently provided tailor-made assistance to protect their interests in accordance with their instructions. The new tax legislation came into force on 1st January 2023 concerning passive income having a foreign source. MA also informed its clients and published an article in relation thereto.

Hi-tech IT tools serving clients’ interests

In 2021, MA safely implemented electronic signatures by the directors of the companies which are the firm’s clients.

MA invested in modern and comprehensive hi-tech tools to communicate with clients and manage their files: we protect our client’s legitimate privileged information. Each member of the Firm’s Legal Team benefits from the hi-tech IT solutions installed in their mobile, laptop, and PC to communicate safely with clients and store safely client information.

PHILOSOPHY

Integrity, good governance, a responsible attitude, and a relationship with

built on

our independence are the values that guide us in all our actions.

FAST FACTS

• MA has strong expertise in Hong Kong corporate matters with a solid team of company secretaries.

• Eric Mayer is the Legal Adviser to the Consulate General of France in Hong Kong.

• MA is situated in the heart of the bustling district in Central (Kinwick Centre, 32 Hollywood Road).

www.mayer.hk

Creativity without compromising compliance

MA’s experience and values allow us to provide quality independent legal advice in cases that are sometimes complex and require inventiveness. We are resourceful in finding legal solutions for our clients involved in cross-border transactions. Contributing to our client’s success stories is our reward. Our management style unleashes creativity and fosters healthy competition and collaboration within the legal team making up our firm.

Social Responsibility

In addition to pro bono work made from time to time for individuals in distress, Eric Mayer is involved in two charities: the French Solidarity Fund “Fonds d’Entraide des Français de Hong Kong (The FEF Trust)” and ANU Mongolia Charity. Both are recognized by the Hong Kong government as being charitable trusts of a public character.

clients

trust without compromising

This Page (left): Legal Team of MA

This Page (below): Eric Mayer

Outstanding Enterprises

HONG KONG BUSINESSES TO GROW MORE DIGITAL, DATA-DRIVEN

Since 2020, the business landscape has vastly changed as organisations worked feverishly to expedite their digital transformation journeys with the aim of providing online support to their remote workers and continuing to reach their audiences amidst the lockdowns.

Amongst the business functions greatly impacted by the trend was marketing. As customers flocked online to access products and services, businesses boosted their digital marketing efforts through digital advertising, e-marketplaces, e-commerce-enabled websites, and social media.

“COVID-19 drove so many people online,” Ewan Ross, the VP of North Asia, Meltwater, an all-in-one media intelligence platform company in Hong Kong, told Hong Kong Business. “Transactions and discussions were happening online. If brands weren’t part of that discussion or if it wasn’t online, then they were really losing out.”

To flow with the times, Meltwater, which was established in 2001 in Oslo, Norway, saw this as an opportunity to expand its offerings to better serve clients as online activities intensified. Currently, the company offers a wide spectrum of marketing and communications services, including Media Monitoring, Social Listening, Journalist Database & PR Outreach, Social Publishing & Engagement, Newsletter & Newsfeeds, Consumer & Audience Insights, Social Influencer Management, and Reporting & Analytics.

Being a one-stop solution, he said, enables brands to harness the digital marketplace. “We acquired cutting-edge technologies and it’s become a wider suite of technologies,” Ross said. “From being very focused on social

listening and helping companies understand what’s being said about their brand online, we’ve broadened to help them understand what their consumers are seeing, who their consumers are, and who their potential consumers could be. We’re also helping companies identify and work with influencers that are a good match to their brand.”

Digital signs of the times

As Hong Kong’s business landscape shifted in the past two years, Ross considers the acceleration of Hong Kong towards the digital economy as the most important recent takeaway.

“Marketing will be a lot more digital and data-driven. It will be much more about understanding data, gaining insights online, and positioning yourself very carefully and very clinically,” he said, confident that it will have the capability to grow its 27,000 global clients and 400 corporate clients in Hong Kong.“Our philosophy is to be the best possible partner. We’re not just a vendor. We’re here to educate, support, and help companies make that transition.”

Top Strengths

Whilst Meltwater is characterised by a strong global presence, with a presence in 50 offices globally across six continents, each local operation is run with a culture-focused approach, said Ross. An imperative is being in the business of understanding brands and how they compare to competitors.

SOFTWARE - MARKETING TECHNOLOGY

PHILOSOPHY

With such a competitive business landscape in Hong Kong, brands need every possible advantage to stay one step ahead of competitors and reach their audience in ways that are genuine and delightful, and that prompt an online conversation. Meltwater’s pioneering tech stack allows all units across a business to access rich media and social data, audience insights, and owned channel performance indicators.

FAST FACTS

• Meltwater was founded in Oslo, Norway

• The company started with only two men, a coffee machine, and $15,000 in startup capital

• Meltwater sponsors a yearly champion chess tournament

• Meltwater founded an Entrepreneurial School of Technology (MEST) in Africa offering incubation for technology startups in Africa

• Meltwater won the HKB Technology Excellence awards in 2022!

This page: Meltwater Hong Kong Office

Opposite page: Ewan Ross, the VP of North Asia, Meltwater

This focus is supported by adapting to new technologies that boost its offerings. “We are constantly iterating and improving that technology over time. We invest a huge amount of our annual budget in research and development, and in acquisitions as well as in adjacent technologies.” The company recently acquired artificial intelligence and data science companies that enable clients to understand consumer insights and identify the right influencers.

Amongst its top strengths, Meltwater places high value on its people, without whom it cannot attain success. “We invest in developing our people to be extremely strong consultants to our clients. We want to develop people who can help our clients navigate the transition from the old world of going through a digital transformation into the digital-first world.”

Today, over 150 of the company’s employees worldwide have worked for Meltwater for over 10 years, a retention rate that reveals the high value the company places on its 2300+ employee workforce globally. Employees are distributed across client success, client acquisition, marketing, and product teams. The company projects a 50% increase in headcount to respond to the growing demand for its services.

“We are proud of having a very vibrant and vivid idea of what culture should be. We focus on employee wellness, ensuring that we’re a fair and equitable employer,” Ross said, whose career at Meltwater spans 14 years, starting in the UK. He was next assigned to South Africa, launched the company in India, and is now based in Hong Kong.

“The pandemic just underlines to me still how important human connection is and how important company culture is if you want to have a vibrant and growing business. As a company, we would like to make sure we are reflecting the issues and causes that our employees care about to be an attractive employer: sustainability, CSR, charity.”

High Flyers Award

For its remarkable resilience during the recent challenging period, Meltwater was recognised in the Hong Kong Business High Flyers Award 2022. Now in its 19th year, the awards programme lauds enterprises for their innovative spirit, outstanding service, and relentless effort to contribute to social progress and business growth.

“We’re happy to be recognised by the High Flyers awards. You have a huge amount of effort and energy that goes into developing our technology and making that technology relevant for our clients.”

“Looking ahead, the company’s mission is to be the very best partner that we can be to help marketing and help communications adapt to a new digital Hong Kong,” Ross added. This will be done by acquiring new businesses and technologies that can support the marketing and communications functions.

“It’s about making sure we’ve got a fantastic place for people to work where they can be developed to be the best possible partners. And it all comes back to the people that help our clients to use that technology.”

Outstanding Enterprises

WORLD-CLASS BEVERAGES WITH PARAGON TRADING ASIA

As Asia’s new champion of beverages, Paragon Trading Asia has consistently produced high quality beverages, leveraging this strength with the scarcity of their wines and spirits as well as the collectability of their vintage liquor.

Christopher Liang, CEO and Chairman of Paragon Trading Asia, used his skills and experience to turn the brand into an outstanding one, winning the Outstanding Beverage Distributor Award at this year’s High Flyers Awards presented by Hong Kong Business.

The force behind the success Leaning on his background as a professional investor, certified asset manager and serial entrepreneur, Christopher received top-level training in venture capital financing and private equity fund management prior to starting Paragon Trading Asia.

After taking a look at the financial performance of the drinks business as a whole, his position as a core shareholder of the company’s underlying strategic investments in wine and spirits gave him enough confidence to push the company into establishing their own import and distribution company focusing on world-class beverages. Having the upstream support of vineyards and distilleries has also secured this decision as the right one.

Ever since the company was established, Christopher has strived to place the company’s products on the top shelf. Thanks to the products’ exceptional taste and quality, they have been recognised and lauded with numerous accolades from international bodies and media companies.

“We genuinely believe that a focus on quality production is an

outstanding characteristic; especially as a Hong Kong business”, remarked Christopher, adding that he seeks to redefine boutique, exquisite, and outstanding with his range of niche but finely-curated product offerings. He has emphasised that their lesser-known yet incredibly tasteful product range packs great value for its consumers.

The company’s operational headquarters is currently located in Hong Kong, an internationally recognised financial centre, lending it an advantage in reaching a wider market as Hong Kong’s status as a freeport and a longterm member of the APEC pool allows its alcohol beverages business to reach higher.

Beverages for any occasion, for any person

Paragon Trading Asia produces and distributes a wide variety of beverages, but the most notable ones in their eclectic range are the Gladstone Wines, Silkie Whisky, and Phenomenal Bewater, which have all enjoyed continued market success and recognition in winning honours.

Gladstone wines come from their vineyard located in the Wairarapa wine region in New Zealand, while the Silkie Whisky hails from its own distillery at Carrick, Ireland. Phenomenal Bewater is the company’s Vietnam-based premium water brand. Paragon Trading Asia continues to seek opportunities and innovations in redefining luxury the Paragon way.

Starting with their Gladstone Vineyard wines, the product range contains five offerings, each with their own distinct flavour profile that seeks to set itself apart from other wines in the market. Despite being a young vinery by industry standards, being established only in 1986, Gladstone Vineyard

PHILOSOPHY

Established in 2021, Paragon Trading Asia stands on four pillars that most would attribute to wealth: wine, water, whisky, watches, in all of which the company consciously applies sustainability practices

FAST FACTS

• Paragon Trading ships wines overseas in 80% recycled, lightweight bottles which reduces the amount of fuel during transport

• Paragon Trading’s product, an environmentally friendly alternative to plastic-bottled water, beWater™, was created to help eliminate single-use plastics and reduce the impact of table water

• Its Gladstone Vineyard wines garnered a minimum of 90 points from wine experts Rebecca Gibbs and Robert Parker

This page: The Legendary Silkie Irish Whiskey, The Legendary Dark Silkie Whiskey, The Legendary Red Silkie Whiskey, Irish Maritime Gin, The International Wine & Spirit Competition Certificate

Opposite page: Christopher Liang, CEO, Paragon Trading Asia

produces some of the best wines from New Zealand.

Wines such as Pinot Noir and Pinot Gris show the quality and dedication that Christopher has put into perfecting their products. Other wines include Viognier, Rosé, Sauvignon Blanc, and the Dakins Road Pinot Noir, amongst many more.

The Silkie Whisky line distinguishes itself with its small releases finished in different casks that make up its unique flavour profile, as offerings such as The Legendary Silkie Irish Whiskey, Dark Silkie Whiskey, and Red Silkie Whiskey pay homage to the county of Donegal’s rich folklore and culture. Gin and Vodka are also available, coming in with the Irish Maritime Gin, Santa Ana Armada Strength Gin, and the Assaranca Vodka.

Paragon’s wines and spirits are produced in small amounts, resulting in uncompromised quality that has garnered exceptional quality ratings, such as Gladstone Vineyard’s minimum of 90 points from wine experts Rebecca Gibbs and Robert Parker.

“Quality creations is at the Heart and Soul of our organisation”, commented Christopher,

Phenomenal Bewater has quickly become recognised as the official water of the Vietnam government. Christopher states that it is also one of the best waters in ASEAN due to both its intrinsic quality as well as our environmental consciousness.

As Paragon Trading Asia has delved into ESG initiatives, Phenomenal Bewater became the company’s flagship product when it comes to showing their capability in sustainability. In an effort to reduce the utilisation of singleuse plastics, Phenomenal Bewater comes in aluminium cans which have been designed to be slightly thinner and sleeker than traditional cans, easing

up the process of recycling and causing less burden during transport.

The company also boasts that they ship wines overseas in 80% recycled, lightweight bottles, which reduce the amount of fuel used during transport, and advocates for organic winemaking and organic wine packaging with the use of 100% organic cork and recyclable or biodegradable glass.

“We initiated a very successful can collection and recycling programmes with our star clients including the Accor Group, the Intercontinental Hotels Group, and New World Hotels,” added Christopher, highlighting the company’s efforts in pushing for more sustainable practices in the beverage sector.

Present and future opportunities for Paragon

A lot has happened within the past two years, with the COVID outbreak disrupting many industries and supply chains that have caused issues for companies across sectors, and Paragon has not been exempt from this.

“Frankly speaking, operations have been tough during the past two years, especially for the F&B sector. However, we have learned to adapt by using technology such as video interfacing, online purchase, and inventory management systems, and are even working on an e-commerce platform,” stated Christopher, adding that the recession on overall restrictions on gatherings and dining in Hong Kong have given them more breathing room.

As a relatively new entrant into the beverage market, Paragon aims to increase their network of sales and distribution point within the foreseeable future, allowing more consumers to have access to their product offerings. The company also aims to match consumer expectations and continue their operations and expansion as a top-level F&B brand in Hong Kong.

PRIORITISING CUSTOMER EXPERIENCE IN THE DIGITAL ERA

PrimeCredit Limited, has been introducing innovative services to be more customer-centric and to earn recognition in the market and of its customers by leveraging financial technologies. As a market leader, it has been adapting and seizing opportunities to grow the business in challenging times.

Chief Executive Officer, Beril Shen says the market has recognised continuing achievements by PrimeCredit.

“I believe this is due to our strengths. We have been in Hong Kong for more than 40 years and have supported the people through good times and difficult times, the financial crisis and the pandemic,’’ Shen says.

She cites resilience, the people and the culture, being open-minded, and innovative, as the principal strengths of PrimeCredit, which has supported its customers through the decades since founding.

“We have a common objective and work closely together. It is a very strong team spirit. That enables us to adapt to market changes. During COVID-19, we turned challenges into opportunities. We focused on innovations of products and services. We upgraded our services and earned recognition and won the hearts of our customers. Our business grew during the pandemic.’’

Referring to being open-minded and innovative, Shen says, the philosophy of being customer-centric is important to the development of the business.

PrimeCredit has been transforming over the past five years to turn from being product-driven to being customer-centric. “The team has an objective to provide an extraordinary experience to the customer,’’ she explains.

Innovative services have been launched in the past year, including a virtual

credit card issuance, where customers can apply online. This is a departure from traditional card application, where customers wait for one or two weeks to get the physical card, Shen points out.

“Once a card is approved you can enable that on our mobile app. There were only a few in the market to enable NFC (near field communication) mobile app payment. Even without the physical card you can use the NFC solution to make payment, online or offline. You don’t need to bind it to Apple Wallet or Google Wallet, or other wallets.’’ A physical card is also issued. But, to use the card, applicants do not need to wait for one, or two weeks. “They can use the card right away,’’ Shen assures.

Providing more offerings

PrimeCredit has been evolving in the past five to seven years. In the credit card comparison website, their card is ranked top, making PrimeCredit not only famous in personal loans but also an established brand in the credit card market.

Shen says PrimeCredit has a long-standing mission to promote quality financial services, she calls it the 3As principle — Available, Affordable, Accessible.

What matters is to promote products that fit customer needs.

“We make choices available. This year, we introduced a unique personal loan offering. During the pandemic, we noticed, many people may not need a large loan, but a small amount, quickly. We introduced the instant cash loan of a small amount in the second quarter right after the fifth wave. Customers only need to make a call. No need to provide redundant

Outstanding Enterprises

PHILOSOPHY

With over 40 years experiences in offering financial products and services, PrimeCredit is committed to providing high-quality customer service, professional consultation and tailormade solutions. Whilst ensuring all their staff are well trained with a high standard of product knowledge, PrimeCredit also emphasizes its understanding of what the customers feel, think and wish, in order to provide them with a comprehensive range of all-round, customer-centric and value-added services.

documents. If they are online savvy, they use our mobile app or website.’’

To enable this efficiency, there was a lot of product streamlining and automation. “This reflects the capability of the team to use fintech to support our business. We leveraged the EKYC solution, big data and AI-based approval process,’’ Shen explains.

PrimeCredit took note of the need for flexibility during the pandemic, and introduced a 14-day payment period. As for affordability, as a money lender, PrimeCredit not only aims to do business but also be a reliable and responsible lender, Shen says. This is an important social responsibility, which PrimeCredit adheres to.

In the past year, PrimeCredit improved its online capability and loan processing. A property owner loan was also introduced. It does not require property as collateral. A lower interest rate is available for a longerterm repayment. Referring to accessibility, Shen notes the buildup of comprehensive channels, including a network of about 30 branches, call centres, and sales centres.

Over the past five years, the digital capability has been strengthened.

“Online, we provide application solutions. We were early in the market to introduce this. We leverage AI (artificial intelligence) and chatbot to make inquiries. We also enhanced our mobile functions for loans and cards. For loan customers we can pay through FPS (Faster Payment System) to their account. For credit cards, they can check statements, balance, get cash advance, and change credit limit into instalments.’’

Shen says PrimeCredit was early to introduce ‘buy now pay later’, as far back as 2016. Customers can change a transaction from a three-

month instalment up to 24 months.

She says the penetration of the mobile app is quite high because of its practical functions and she demonstrated how it displays account details, instalment options, payments choices, QR code ATM withdrawal, insurance services, and travel services, and e-vouchers of different merchants.

Caring for employees and the environment

The pandemic, in particular the first quarter of 2022, was a challenge for the staff and their health, and this was considered a priority. Flexible work hours introduced along with casual wear. The uniform at branches was changed to Polo shirts. An online lucky draw offering staycations, cash and travel vouchers was held to excite staff with fun.

“We were the only money lender with staff working from home. We closed half of the branches, but there were no customer complaints. We balanced staff welfare with customer needs,’’ Shen says.

Referring to ESG initiatives, Shen says environmental projects include paperless measures such as e-statements, e-channels, iPads for application submission, and so on. PrimeCredit sponsors events and contributes to financial inclusion.

Warning: You have to repay you loans.

Don’t pay any intermediaries.

Complaint Hotline: 2111 2999

Money Lender’s Licence Number: 775/2022

SOARING TO NEW HEIGHTS, ONE FLOOR AT A TIME

With a pedigree in designing and manufacturing quality, reliable, finely-crafted safe custom design-built elevators, Sakura Elevators have provided a one-stop professional engineering service for their clients around Hong Kong. Their offerings of the finest, smartest, and safest elevators for homes, villas, institutions, and commercial establishments have distinguished them enough to win the High Flyers Award presented by Hong Kong Business.

Integrating advanced technologies has produced intelligent elevators that satisfy the needs in smart homes and commercial facilities, all made possible with the company’s expert team of engineers, professional architect firms, top interior designers and contractors.

Rising above their competition

The past two years have driven innovation within Sakura Elevators, as R&D teams in Japan designed, engineered, and integrated new and traditional technologies and launched epidemic prevention solutions for Sakura custom elevator lines.

“Sakura Elevator Hong Kong provides one-stop engineering services in working with architects or interior designers to deliver custom design elevators for luxury villa homes in Hong Kong,” remarked Mr YC Chua, Director of Sakura Elevator (Hong Kong) Limited.

Sakura Elevators, Hong Kong’s leading custom luxury private home elevator provider, offers made-to-order custom design solutions to meet the needs of each unique interior design and structural requirement. They provide integrated custom design, build, installation, and maintenance

solutions to make their products hassle-free for their customers, along with submission for compliance with local government authorities’ approval and routine maintenance service.

Following their 12-step workflow, project completion typically spans between 8 to 12 months from inception to design, authority approval, elevator shaft builder’s work, manufacturing, shipment, installation, testing and commissioning, governing user permit, and end-user training.

When it comes to safety and comfortability, Sakura has used the highest standard from Japan AMADA, integrating automated production and quality control and fabricating custom design elevators to pass the toughest and highest certification standards across electrical, mechanical, energy and safety certifications in advanced markets.

The company has found success in Japan, Greater China, South East Asia, and Middle East countries and has rolled out subsequent add-on features on their elevators to make them compliant with COVID-19 health measures implemented in the areas, delivering a smart, safe, and clean experience. Such features include the non-contact button, Life Detection Ultra-violet Lift Sterilization Device, Gesture Recognition Device, Virtual Pedal Bottom, Anti-Bacterial Filtration Fan System, and Voice Recognition.

The promotion of all-new epidemic prevention add-on solutions to all customers aims to provide customers with a safe and clean home environment, especially after the COVID-19 pandemic redesigned many lifestyles and transformed some parts of many people’s daily lives and routines. These solutions aim to protect clients and users from germs,

PHILOSOPHY

To provide one-stop professional engineering services for custom design and build, installation, and maintenance service of the finest, smartest, and safest home elevators to Hong Kong luxury villas and commercial facilities.

FAST FACTS

• Sakura Elevator designs and manufactures quality, reliable, safe & fine craftsmanship custom designbuilt home elevators for village homes, private estate luxury villas, restaurants, elderly homes, schools, retail stores, etc. in Hong Kong and worldwide.

• Sakura Elevator expert engineering teams work with our partners: professional architect firms, top interior designers and contractors seamlessly to deliver end-to-end and one-stop custom home elevator projects in Hong Kong.

• Sakura Elevator Hong Kong provides elevator monitoring, technical support, 24x7 customer services and regular maintenance services to our Hong Kong-based clients

This page: Sakura Elevator’s custom elevator lines

Opposite page: (from L-R) Leon Hsu, President of Sakura Elevator Taiwan, YC Chua, Director of Sakura Elevator Hong Kong, and Hideki Ota, Nippon Sakura Elevator President

bacteria, and viruses that may loiter around surfaces and in the air.

Sakura Elevators pride itself on its precision, as their engineering design, construction, manufacturing and deployment of custom elevator projects go under immense scrutiny by their teams to make sure all details are polished and client needs are met. From this precision in operation, the quality and safety of the elevators are held to a high standard with customer satisfaction going through the roof thanks to the product of highly skilled team members and their services.

In-home elevators are now possible thanks to Sakura “Installing an elevator for everyday home use may be one of the best investments for many families in Hong Kong,” said Chua.

Thanks to the research and development that Sakura Elevators has poured into for the past 25 years, installing elevators in homes has become a reality and has greatly aided accessibility for the elderly and provided convenience to customers who move heavy items around their house. As a result of employing a team of personnel highly skilled in electrical and mechanical engineering, structural engineering, and elevator engineers and technicians, the elevators are easy to integrate into advanced smart features for intelligent homes.

Their engineering prowess has recently resulted in the development and launch of the world’s smallest home elevator, measuring only 80 cm by 80 cm and available in Japanese and Asian markets.

Safety, comfortability, and sustainability in one package Sakura Elevators’ products boast an array of safety features aside from the additional ones implemented following the COVID-19 outbreak.

Their elevator doors are UL USA Certified Fire Proof that can withstand 2 hours of a blaze in the event of a fire, whilst smart sensors implement earthquake and flooding detecting features that prevent the ingress and use of the elevator in the event of special adverse conditions.

Other features include the Unintended Car Movement Protector (UCMP), which acts as an independent brake system safety feature wherein the UCMP will stop the elevator in the event that the doors are forced open or faulty. This feature complements the Smart Fall Detection Monitoring System and Auto SMS Notification Maintenance Service that immediately notify repair teams in the event of misuse, power outages, elevator mechanical door failures, or medical emergencies inside such as fainting.

The company’s engineering teams are well-trained to understand and communicate the design requirements and constantly collaborate with the manufacturing teams to develop, design, and fabricate custom elevators according to the physical site, environment, and aesthetic requirements. In any case, Sakura’s Hong Kong customer service team provides end-user training, routine maintenance and inspection, faulty service monitoring, and 24-hour on-call services for clients that encounter any issues with their elevators.

Energy efficiency tests have also shown that Sakura Elevators’ products constantly meet increasingly stringent standards for consumption by energy-using goods, receiving TÜV SÜD Germany’s Class A Energy Efficiency Test Certificate. According to reports, the company plans to advance research and development in elevator design and customization options, as well as add more safety features and green energy features.

Outstanding Enterprises

A SANCTUARY OF SAFETY AND DELIVERANCE

Over the last few years, the financial services industry has faced many challenges, not least of which was the pandemic. “The business arena froze during the pandemic, which has meant we’ve had to work especially hard to attract interest from clients and prospects, many of whom don’t know they have a tax problem,” said Mark Kirkham, Chief Distribution Officer at Soteria Trusts, who helps clients protect, manage and grow their assets through a range of trusts, international retirement solutions, and tax advisory services. Despite the challenges, the industry has shown extraordinary resilience in overcoming them. However, they are far from being over with more on the horizon for 2023 in the form of inflation, a likely recession, regulatory and compliance changes, as well as increasing competition. To overcome these hurdles, financial services companies must become more efficient and continue down the road of innovation whilst maintaining a focus on customer needs and a move to utilising technology more and more within their processes. The market will continue to develop and evolve with a range of simple products and solutions complemented by more sophisticated offerings that can serve the mass market, retail and high net worth segments.

Bringing the traditional and the modern together and endeavoring to simplify yet innovate their fiduciary solutions, is what Hong Kongbased Soteria Trusts has done. Named after the Greek goddess of safety and salvation, deliverance, and preservation from harm, Soteria’s initial mandate is to offer core services which focus on tax-efficient retirement and Inheritance Tax (IHT) mitigation for individuals with assets in the United

Kingdom. “This year, we have expanded our proposition to include wider estate planning solutions with new services such as will writing, powers of attorney, and additional tax planning strategies, such as Family Investment Companies, a range of simplified discretionary trusts alongside the qualifying non-UK pension schemes (QNUPS),” said Kirkham, who is also the founding director of Business Class Group, who provide financial solutions to local and expatriate communities across Asia.

Despite being a relative new comer to the Business Class Groups operating brands, Soteria Trusts, which was established in 2016, has made its mark by offering unique products that help clients mitigate their inheritance tax liabilities. Noticing that clients often needed help with more broad estate planning issues, it initiated the offering of the very basics of estate planning, which includes will writing, guardianship nomination and Powers of Attorney. “Before, we focused on complex solutions,” relates Kirkham.

“Now we offer full estate planning solutions in one place. After 33 years of working in the financial services industry, I am more convinced than ever that there is a gap. There is an increasing number of people focusing on their future wellbeing and making investments yet the number of those who consider the correct structuring of those worldwide assets is disproportionally small. By a process of education and bringing genuine tax efficient structures to their attention, Soteria fills an underserved cross section of the investing public.

The Soteria Inheritance Tax Planning Service was developed to deal with IHT differently, and ultimately allowing those who subscribe to it, to pass on

PHILOSOPHY

honesty

more of their wealth to loved ones, he reiterated. He further explains that whilst the inheritance tax allowances remain frozen for at least another three years, the value of assets continue to increase. As a result, people end up with greater exposure to income, capital gains and inheritance taxes.

According to Kirkham, “Our IHT planning strategies save client’s and their family from the struggle of probate and, most importantly, on average, over £500,000 in future inheritance taxes. Whilst the service focuses on Inheritance Tax, if the clients decide to sell their assets within the structure, they will not be exposed to Capital Gains Tax, the threshold of which has just been reduced in the latest Autumn Budget.” Such benefits to the customer reinforce the company’s mission to offer them a degree of safety “knowing that their hard-earned money will stay and grow within the family and will not be diluted by taxes.” Today the company works with clients across its office network, helping them establish IHT-efficient structures and retirement schemes. Kirkham admits that Soteria’s IHT Planning is UK-centric but counters that its retirement planning and will-writing solutions “are for everyone, of all nationalities and in any country – not just Brits.”

On the Wings of Innovation

In acknowledgement of its innovation, Soteria has been recognised with the High Flyers Award, an annual honor given by Hong Kong Business Magazine which highlights the region’s most successful companies. Started in 2004, the awards programme formally attests to the excellence of top enterprises that offer innovative products and exceptional services. “We are delighted to be winning this award again! This shows that our work is being recognised and appreciated, which keeps us motivated!” said Kirkham.

FAST FACTS

Deliver TRUST AND FIDUCIARY SERVICES

• Save hundreds of thousands and in many cases millions in future estate related taxes

• Protect assets from Creditors

• No Probate following death

• Increase awareness - Income or Corporation Tax, Capital Gains Tax, Inheritance Tax, Annual Tax on Enveloped Dwellings & Stamp Duty

Opposite page: Mark Kirkham, Chief Distribution Officer at Soteria Trusts

Operating on the core values of knowledge, experience, support, and care, the company aims to advise clients “with excellence and a genuine care for their family affairs” and differentiates itself through unique, innovative solutions. Another distinguishing area for Soteria, is to assist clients obtain refunds from the UK tax man of up to 70% of the Stamp Duty Land tax they paid on UK property transactions that took place up to 4 years ago. According to the gov.uk website, current SDLT thresholds stand at £250,000 for residential properties, £425,000 for first-time buyers buying a residential property worth £625,000 or less, and £150,000 for non-residential land and properties. Above that threshold, buyers must pay up to 15% of the proportional property value in the form of Stamp Duty Land Tax.

Educational Marketing

To build its customer support and relationships, Soteria Trusts conducts regular monthly educational workshops and seminars where attendees can learn and get real-time responses to their questions. “During the pandemic, we started our bi-monthly webinars and focused more on social media and digital marketing to attract clients,” Kirkham recalled, enabling current and prospective clients to spark conversation. ‘A large part of our marketing activity is now spent delivering those online events, which were a subtle but significant change brought about by Covid, and as they became more popular and successful, they became our new norm,” Kirkham adds. These activities are part of more extensive marketing campaigns that offer free information guides around retirement planning, SDLT refunds, will and estate planning, and free tax assessments to clients.

STANDARD CHARTERED: HERE FOR GOOD

Standard Chartered Bank has continued to innovate in expanding its capabilities to help clients, employees and the community undergo change. These areas of transition include working towards net zero targets, moving to a post-pandemic world and building a digital future. Through sustainable finance solutions, relief measures and a growing number of corporate social responsibility (CSR) initiatives, the bank has engaged with stakeholders and the wider community to overcome challenges together.

For its work, Standard Chartered was honoured for the fifth consecutive year as the ‘Bank of the Year’ in the High Flyers Awards 2022. Presented by Hong Kong Business, this annual award recognises businesses that exemplify innovation, quality of service, and a strong commitment to social progress.

Towards a sustainable future

Standard Chartered Group is in the process of mobilising US$300b in green and transition finance globally by 2030 to help clients across different sectors achieve their green ambitions. In 2022, the bank has participated in a number of significant sustainable financing projects in Hong Kong, including the West Kowloon Cultural District Authority’s first sustainability-linked loan. Meanwhile, the bank has also contributed remarkably to the development of the voluntary carbon market in Hong Kong, participating in the first batch of carbon credit transactions on Core Climate – an international voluntary carbon marketplace launched

by the Hong Kong Exchanges and Clearing Limited.

“Standard Chartered Hong Kong is fully dedicated to promoting sustainability in the market and sustainable finance is a strategic priority of the bank. We are helping our clients transition to net zero through our dedicated sustainable finance teams alongside a wide range of innovative solutions and product suites,” said Mary Huen, CEO, Hong Kong at Standard Chartered.

The bank has launched various sustainable finance solutions such as Sustainable Bonds and Private Placements, Sustainable Loans and Deposits, ESG-linked Derivatives, Sustainable Trade Finance, and Green and Sustainable Mortgages to meet the needs of retail, corporate and institutional clients. Standard Chartered is committed to reaching net zero carbon emissions in its operations by 2025.

Servicing the local community

To lift the community spirit and support clients as they begin to move into a post-pandemic era, the bank has brought back long-running community events, conducted philanthropy for local causes and offered a new round of relief measures. The bank also lined up a variety of physical and virtual community activities that benefitted hundreds of thousands of individuals with the help of more than 3,400 staff volunteers. As CEO, Huen volunteered for community service events throughout the year, while local staff members volunteered a combined 3,700 days in 2022.

PHILOSOPHY

“We aim to give back to the community, not only through our landmark events such as the Hong Kong Marathon and Arts in the Park but also through championing local causes,” said Huen. “Our brand promise, ‘Here for good’ captures our commitment to always try to do the right thing, take a long-term view, and support our clients and the communities where we operate,” she added.

With the aim of promoting a healthy lifestyle and bringing positivity to the community, the bank brought back the annual Standard Chartered Hong Kong Marathon. The bank has been a title sponsor of the marathon since 1997, and its return in 2021 marked the first large scale participatory sporting event in the city since the start of the pandemic. 16,000 runners attended the marathon, half marathon and 10 km races. A virtual run was also introduced for the first time, with over 4,000 runners around the world taking part.

Sports is not the only area in which the bank is supporting the community, providing the youth with exposure and opportunities in arts and culture is also important. Standard Chartered Arts in the Park is an annual education programme and festival that aims to enhance selfconfidence and important life skills amongst the youth through the arts. In 2022, 8,000 local artists and students as well as over 2,000 Standard Chartered employees participated in the programme, which culminated in a festival that attracted over 30,000 visitors.

On the philanthropic side, a number of community organisations impacted by the pandemic have benefitted from the bank’s donations in

BANK OF THE YEAR

FAST FACTS

• Standard Chartered is a leading international banking group, with a presence in 59 of the world’s most dynamic markets and serving clients in a further 83

• The history of Standard Chartered in Hong Kong dates back to 1859. It is currently one of the Hong Kong SAR’s three note-issuing banks

• The bank provides a wide range of banking services to retail and corporate clients, and has over 70 branches and over 180 ATMs across Hong Kong

• Standard Chartered PLC is listed on the London and Hong Kong stock exchanges

This page: Standard Chartered completes first voluntary carbon credit transactions on HKEX’s Core Climate, Arts in the Park, Standard Chartered Marathon

Opposite page: Mary Huen, CEO, Hong Kong | Chairman, Mox | Group Management Team, Standard Chartered Bank

2021 and 2022. A donation of HKD$10m was made to the Hong Kong Council of Social Service to support about 300 unemployed women in delivering anti-epidemic kits to 10,000 homebound families. Another donation of HKD$15m was provided to launch a three-year programme “Futuremaker’s First Job” in partnership with St. James’ Settlement to enhance recent graduates’ employability.

Investing in talent development for a Digital Future “People are the key drivers of success and that’s why any transition to a digital future needs to be accompanied by support from the bank for our employees,” said Huen. “We believe in our people and their potential, and we as a bank are adapting to ensure they have the flexibility, tools and opportunities they need to develop their skills,” she added.

An example of the investment the bank makes in fostering talents is the launch of the HKU-SCF FinTech Academy, which was co-created with The University of Hong Kong in 2020 with HKD60m in funding from SCHK 150th Anniversary Community Foundation.

In terms of flexibility, Standard Chartered was amongst the first in the industry to introduce permanent flexible work arrangements. More than 80% of eligible employees have benefited from this programme and are working from home at least one day per week. Aside from the hybrid work, the company has also introduced benefit policy changes, well-being tools and apps, and intervention services.

Standard Chartered Bank is committed to promoting economic and social development in the markets they serve, doing so sustainably and equitably in line with their purpose and three valued behaviours: ‘Never settle’, ‘Better together’ and ‘Do the right thing.

PROVIDING INCLUSIVE AND COLLABORATIVE SPACES

By providing agile and adaptable work space solutions, theDesk is transforming the way companies and their people work at a time of continuing challenges for businesses.

It has created interactive work spaces that encourage the building of inclusive communities, wherever it operates in Hong Kong — whether it be in the business districts, commercial centres, or in the New Territories.

TheDesk has cleverly combined technology and innovations to create a virtual work and collaboration platform.

The company’s evolution so far, reflects the passion of Thomas Hui, CEO and Co-founder of theDesk, to solve business problems.

Hui was a former commercial banker in relationship management. Later in his career, Hui founded a consulting firm, and in six years it became a 30 person firm with a presence in Hong Kong and China. In that role, he has enjoyed solving SME business challenges. But, having realised that, “consulting is not scalable’’, he went on to take up another challenge.

“I did not enjoy retirement and found that I loved Hong Kong. I returned to Hong Kong and started theDesk. I asked myself what do I love. I love to be surrounded by passionate entrepreneurs,’’ he says.

He founded theDesk in 2016 and he was enthusiastic in building a business community.

The first site was in Sai Wan. It was about 8,000 square feet with a shop front and three floors. Witnessed the rise and fall of WeWork, Hui realised that execution is the key to success.

theDesk expansion

In the first three years, theDesk expanded into Causeway Bay, Admiralty and Sheung Wan. During that time, the turmoil at WeWork was in the headlines, Hui remembers. As Hui sees it, the six years, so far, has been a period of two halves for theDesk. “The first half was about the boom in the industry and over-expansion. The second part is about consolidation.’’

And in the past three years, theDesk has been expanding and evolving its business model “according to our vision’’, Hui says.

In Causeway Bay, theDesk works with the biggest landlord, Hysan Development. “Because of our inclusive community ethos, Hysan treats us like a strategic partner. We expanded into Sheung Wan and work with SUNLIGHT REIT. They treat us as a strategic partner.’’

Talking about ‘community’ is not a mere marketing buzzword, Hui says. “We can quantify and monetise community value. We define it in two key metrics. One is the stickiness of members. If the members move every six months, it is not a community,” Hui says that in the last two years, theDesk retention rate has consistently been above 85%. The second metric is the quality of the community,”

Hui says. “If you emphasise connecting people, you want to connect quality people.’’

The resilience of the members also contributes to growth of theDesk. And some members become partners and theDesk promotes their services to others. TheDesk and the members share in each other’s success.

PHILOSOPHY

At theDesk we believe everyone can take a step and make a change, and we are building a platform that small or large local communities can easily engage, contribute and work together towards solving social issues

FAST FACTS

• Founded in 2016, theDesk offers flexible and productive workspaces with a focus on building inclusive and collaborative communities that enable meaningful business connections.

• Across 10+ prime locations in Hong Kong and Greater China, each community is moulded by and personalised for our members.

• theDesk is building a platform of spaces, services, and online immersive experiences to support a changing workforce and business growth.

“In 2021, the growth due to the expansion of our members was 10 times of 2020 and it contributed to more than 20% of our overall growth. This shows theDesk attracts quality business. We retain them and take them from good to great,’’ Hui says. The collaboration with members helps the relationship to be more enduring, Hui says. “They are not just using our space, we are business partners.’’

Hui notes that this is another big revolution in the industry. “The revenue stream evolved from pure space to services. And the relationship with the member from just a space solution provider into a service.’’

Amidst the challenge of the past three years, Hui has steered theDesk to seize the emerging opportunities in the sector.

“A lot of competitors exited. We are not just growing but also consolidating. In the first quarter this year, we acquired Jumpstart – a long established serviced office provider in Hong Kong. The implications are two things — we are evolving into a service platform,’’ he explains. “Now we offer company secretarial services and virtual offices to our community. Jumpstart has a strong brand name and foundation in Shanghai. It has strengthened our presence in Shanghai.’’

Future plans

Hui says that in the next chapter, the Desk is leveraging on two big trends — decentralisation of work, and the rebalancing of globalisation.

Referring to decentralisation of work, Hui believes that even if COVID-19 normalises, work behaviour will not return to what it used to be. He says, he has seen the evidence that supports this hypothesis.

“I believe the autonomy of how to work, shifted from employer to

This page: theDesk at Leighton Centre (Causeway Bay) and Sai Wan (Queen’s Road West)

Opposite page: Thomas Hui, CEO and Co-founder of theDesk

employee. Every employee now has higher autonomy on how to work, when to work, where to work. This is the new norm. Customisation of work,’’ he explains.

He cites Kuala Lumpur and Jakarta, where remote work take-up means the office vacancy is 70%. “It used to be about 85%.’’ This may be happening in Hong Kong, as well, he reckons. “Two months ago, there was a news report about 21% occupancy at Cheung Kong Centre. This is just the beginning.’’ But, he hastens, to add, commuting costs are lower and the transport infrastructure is much better in Hong Kong, compared with those two cities. In Hong Kong, theDesk has already opened spaces in residential areas. There are two spaces in Sha Tin.

“None of the key operators in Hong Kong have a presence in Sha Tin. And we replicated this success with Kerry Properties in launching a new coworking space at the Kerry Hotel. Hung Hom is a traditional residential area yet we see strong demand as people prefer working close to where they live. You need a new approach to evolve in this industry. You evolve with human behaviour,’’ Hui says. Referring to the second big trend that is the rebalancing of globalisation, Hui is certain that “every government, every company needs to rebalance risks in the post-COVID-19 period.

“MNCs are rebalancing their supply chain. In this rebalancing, two big regions will benefit — the Middle East, especially the GCC, and Southeast Asia,’’ Hui says. To seize opportunities from the trend to rebalance risks, Hui is actively planning for expansion in new regions. TheDesk will evolve into providing services and enhancing its digital offerings. “Beyond Hong Kong and China. This is the next chapter.”

COMPANIES AND INDUSTRIES

Electronics dominates merchandise export

Major printers relocate to Mainland to reduce costs

Private equity interest in warehouse assets persists

Office rents continue to fall

Hong Kong’s hotel industry recovers slowly

HONG KONG’S HIGH FLYERS

Outstanding Enterprises 2022

Archikris Design Group

AV Consultant (Int’l) Ltd

AXA Hong Kong & Macau

AXA Hong Kong & Macau

Clansman Lifestyle

Elite Concepts

Fidelity International

Hang Seng Bank - Global Banking

Hyatt Regency Hong Kong, Tsim Sha Tsui

Mayer & Associés

Meltwater

Paragon Trading Asia Ltd

PrimeCredit Limited

Sakura Elevator HK Ltd

Soteria Trusts

Standard Chartered Bank Hong Kong