AGENDA | NOVEMBER-DECEMBER | 2013

OFFSHORE BUSINESS

NEWS

EVENTS

COMMENTS

Issue 4 November/December

Isle of Man

2013

On the Agenda

Buzz Words & Management Fads Offshore Reports Q2 FINANCE - LLOYDS BANK IOM INVESTORS REPORT TECHNOLOGY - SURE INTERNATIONAL, THE CLOUD INVESTORS - SILICON IOM PLUS - IN THE NEWS, MONEY TALKS, CORPORATE CULTURE: THE KEY TO SUCCESS

On the Agenda...

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Lloyds Bank IoM Investors Report

KEY CONTACTS EDITORIAL & DESIGN Steve Redford DD : (+44) 7624 249249 steve@agenda.im

Sure International The Cloud

ADVERTISING SALES Rachel Morris DD: (+44) 7624 209726 rachel@agenda.im

CONTENTS

CLIENT RELATIONS Laura Macgregor DD: (+44) 7624 249249 Laura@agenda.im Disclaimer: All rights reserved. Any form of reproduction of Agenda Isle of Man Magazine, in part or whole is strictly prohibited without the written consent of the publisher. Any views expressed by advertisers or contributors may not be those of the publisher. Unsolicited artwork, manuscripts and copy are accepted by Agenda Magazine, but the publisher cannot be held responsible for any loss or damage. All material, copy and artwork supplied is assumed to be copyright free unless otherwise advised.

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In The News ..................................................... 3

Corporate Culture ....................................... 19

IoM Investors Report .................................. 7

Jersey/Guernsey News ............................ 21

Sure International - The Cloud ........ . 11

Appleby Offshore Reports Q2 ........... .. 22

Silicon IoM ...................................................... 13

Buzz Words & Management Fads... . 23

A-List Events ............................................... ... 15

Money Talks .................................................... 25

Typhoon House Profile .......................... 17

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19 Stories History Values Money Talks

Rituals & Routines

17

Heroes Symbols

Silicon IoM

23

Structures

Corporate Culture

15

Typhoon House

A-List Events

Buzz Words & Management Fads 2

In The News IoM

The Global economic outlook Europe is on course to become ‘the largest open air museum’, whilst Africa’s growth has been ‘stellar’ - just two of the points made to around 40 guests at the recent Standard Bank breakfast seminar held by Chief Economist and Head of Research, Goolam Ballim.

The seminar entitled: Global and Africa Trends took account of the research Goolam and his team of 72 analysts perform for Standard Bank. There was positive news on the global economic outlook, assuming the USA is able to sort out its current financial impasse and raise its debt ceiling, with Europe and the UK seeing modest growth which should continue. Goolam warned that the coming months are likely to be difficult as the US Federal reserve tapers its quantative easing and backs away from supporting the economy.

In Europe, whilst there are currently signs of optimism with modest growth, Goolam warned that there are several factors which mean the region is storing up trouble. There is the steep debt the region has built up, its declining working population, set to fall 14% or 30 million people over the next 20 years, and its high unit labour costs which all make Europe uncompetitive. Goolam said that Africa’s population on the other hand is young and it is growing, Nigeria alone will grow from 180 million people to 230 million by the end of the decade. The median age in Africa is also 20 compared to Europe’s 40, and by 2050 it’s estimated 25% of the world’s population will be African.

Ian Hamilton, Head of Corporate & Business Banking, Standard Bank IoM said: the seminar had highlighted the potential as well as the risks for our global economy: ‘The intra regional trade is only around 10% compared with Asia’s intra region trade, but that is now growing faster in Africa than it is with the rest of the world. The continent is heavily under-urbanised, and its consumer markets are only just starting to develop.

Whilst there are as many fixed telephone lines in Africa as there were 13 years ago, back then there were only 20 million cellular phones, now there are 750 million – that is the kind of growth figures we are talking about, and so the potential becomes very clear.’

Goolam has been recognised as producing leading economic research on Africa. He is a past winner of South Africa’s top economist award and adviser to the country’s Minister of Economic Development and other public sector officials.

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KPMG Announces International Speaker Line-up for 2013 eGaming Summit

• • • • •

KPMG and RGA representatives to present an economic analysis of the proposed Point of Consumption Tax, based on the work recently carried out by KPMG for the RGA. Sportsbooks, mobile, enforcement, and payments retain presentation focus.

DLA Piper and Playtech’s Hilary Stewart-Jones to host panel.

KPMG Isle of Man has announced the speaker line up for its fourth annual eGaming Summit, which includes major international industry experts as well as key representatives of the local cluster.

The Summit will once again open with a welcome to delegates from both on and off the Island, and an overview of the Government’s approach to supporting and developing the local sector. An opening address by Russell Kelly, the Director responsible for eGaming at KPMG Isle of Man will follow, after which GBGC’s Warwick Bartlett will outline the global picture for gaming. The morning session will also feature a joint IOM specific sector update from the IOM Government’s new Head of eGaming, Peter Greenhill, and Steve Brennan, CEO of the Gambling Supervision Commission.

After a morning coffee break, Dominic Atkinson of Island-based sports betting network, Tailorbet, will present on the evolution of sports betting. The first of the day’s panel sessions will then be hosted by Hilary Stewart-Jones of global law firm DLA Piper, whose appointment to the Board of Playtech has just been announced. She will invite panellists including Paul Leyland (until recently Corporate Development Director at William Hill) and Peter Kjaer (CEO of Ho Gaming) to address the topic of enforcement as it relates to today’s eGaming industry.

KPMG’s Head of eGaming, Archie Watt will reopen proceedings after lunch (kindly sponsored by Pokerstars) and will introduce the second panel session of the day, a much anticipated discussion on the topic of payments with representatives from Ukash, Entropay, Optimal Payments, and Counting House. Neill Whyte of Microgaming will then take over with a presentation on the growth of and outlook for mobile gaming, an always popular and rapidly developing topic. An afternoon coffee break will be followed by a joint economic review of the proposed change in UK legislation for online gambling taxation by Sue Rossiter of the Remote Gambling Association, and Bill Robinson and Adam Rivers, the KPMG gambling tax policy specialists who produced the recent report for the RGA. A third panel session will be the last presentation of the day and will see leading delegates tackle the future for eGaming in 2014 and beyond, before the day is closed by the Hon John Shimmin MHK, Minister for Economic Development.

Russell Kelly, Director responsible for eGaming services at KPMG Isle of Man, commented: “The KPMG eGaming Summit series is now a major milestone in the international sector and, as it grows in popularity, continues to attract ever more influential and engaging speakers. This year’s line-up is one of our most varied to date, and I’m confident that our speakers will again offer a penetrating insight in to this diverse and dynamic industry. We’re looking forward to what is set to be a great day of sharing knowledge, strategy and insight, and building stronger community relationships in the process.”

The Summit, the fourth annual event to be held on the Isle of Man, will be held at the Mount Murray Hotel on 12th November. Attendance is by invitation only. For more information, or if you would like to request an invitation, visit www.kpmg. co.im and search for ‘eGaming Summit’, or visit www.whereyoucan.im. For those unable to attend, a full report of the day’s events will be published due, once again, to the support of Continent 8 Technologies.

IMGold bullion depository open for business A new Douglas-based gold bullion depository and trading company is now officially open for business. IMGold is the trading name of Isle of Man Bullion Ltd which can buy, sell and store gold and silver bullion. Based in Victoria Street, it has offices and below ground vaults which are electronically protected and monitored by G4S with security systems equalling or exceeding industry standards. In an era in which confidence in banks, the stock market, and even entire national economies has been shaken by crises and scandals, the business is responding to renewed worldwide interest in gold and other precious metals. Ed Pearce, IMGold Managing Director, said: “IMGold is unique as we offer depository facilities to both small and larger-scale bullion owners. Our clients can actually visit us and withdraw, deposit, or purchase bullion for their holding at any time. Customers are able to buy, store and sell bullion, in amounts from as little as 500g. The bullion our customers purchase is never a portion of a bar owned by somebody else. Each bar customers buy belongs to them, and remains their property until they decide to sell. As faith in the safety of banks and currencies seems to be diminishing across the world there is a growing demand to own a tangible asset such as bullion.”

IMGold also offers an online platform which allows customers to purchase bullion securely from wherever they are.

IMGold customers can take physical possession of their bullion at any time with just 24 hours’ notice. Organising secure storage in vaults with the necessary security and insurance arrangements required for storing precious metals is costly and time consuming. The financial and logistical considerations make secure storage an impractical solution

for most individuals and businesses. Therefore, IMGold provides these facilities to its customers in return for a costeffective fee. Mr Pearce added: “The bullion business is seeing people who have not previously thought of it, now buying gold and other precious metals as part of a strategy to protect their private wealth.

IMGold was founded to meet this demand and to make the buying, selling and storage of gold and precious metals as simple and straightforward as possible. While we can provide the latest market data to clients, we do not provide investment advice. The feedback we have from our first customers is they appreciate that we do not try to ‘sell’ them the idea of investing in precious metals. When customers visit us, there’s no sales pitch. We just give straightforward answers to their questions about owning precious metals based on our extensive expertise and experience in this field.”

Tony Barber, IMGold Chairman, is the head of a very experienced executive team. For nine years he was a Commissioner with the Isle of Man Financial Supervision Commission, a role following a successful career with the Royal Bank of Scotland Group during which he became a director of RBS International. Ed Pearce has held senior operational positions in a diverse sector of industries, including a role as Head of Operations for one of the UK’s first independent Payment Gateways. He returned to his home in the Isle of Man, and a career in wealth management, after successfully assisting the sale of Protx to a FTSE100 business.

For more information go to www.imgold.com

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EITHER YOU SEE IT OR YOU DON’T O p p o r t u n i t y. I t ’ s n o t a l w a y s o b v i o u s , b u t w h e n y o u ’ r e a l w a y s l o o k i n g f o r i t , i t b e c o m e s p o s s i b l e t o f i n d . A t N e d b a n k P r i v a t e We a l t h w e v a l u e o p p o r t u n i t y a n d p u r s u e i t r e l e n t l e s s l y. I t ’ s h o w w e f i n d n e w a n d i n n o v a t i v e f i n a n c i a l s o l u t i o n s f o r y o u a n d y o u r m o n e y.

UNITED KINGDOM

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ISLE OF MAN

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JERSEY

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U N I T E D A R A B E M I R AT E S

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SOUTH AFRICA

Nedbank Private Wealth is a registered trade name of Nedbank Private Wealth Limited.

Nedbank Private Wealth Limited is licensed by the Isle of Man Financial Supervision Commission. Registered office: St Mary’s Court 20 Hill Street Douglas Isle of Man.

www.nedbankprivatewealth.com

In The News IoM

Department encourages engagement with International Festival for Business 2014

Boston Group Expands with Malta Trust Licence

The Department of Economic Development is encouraging local businesses to participate in the International Festival for Business, which is being held in Liverpool during June and July next year. The Festival is set to attract 250,000 professionals from 125 countries and the Department is planning to showcase the Isle of Man’s diverse, successful economy.

Minister for Economic Development John Shimmin MHK commented: “In line with delivering the Government’s ‘Agenda for Change in Our Economy’ which sets out priorities for delivering economic growth we are committed to forging new sustainable relationships with other countries and business partners. The International Festival for Business will be a unique opportunity for the Isle of Man to showcase our status as an international business centre at a major global business event being held right on our doorstep.

In addition to our geographical and historical connections with the region, and with Liverpool in particular, the Isle of Man is a significant contributor to the North West’s economy.

My Department also continues to maintain a wide range of relationships with the North West, such as the Isle of Man Aerospace Cluster’s membership of the North West Aerospace Alliance and the Isle of Man Ship Registry’s membership of Mersey Maritime.”

The Festival will take place across Liverpool and the surrounding areas over 50 days next June and July and will feature events for professional and financial services, maritime, logistics and energy, manufacturing, science and technology, low carbon and renewables and creative and digital amongst others.

Over 100 separate events are being hosted, attracting 250,000 delegates from both developed and emerging markets such as China, India, United Arab Emirates, and the United States. The International Festival for Business also has the full backing of the UK Government, being publicly endorsed by Prime Minister David Cameron.

The Minister continued: “Given the range of sectors incorporated within the Festival it is highly appropriate for the Isle of Man to be involved. Many firms in the Island compete successfully against the very best in the world in their respective sectors so I would encourage them to consider engaging with the Festival.

We have developed a project team from within existing resources to manage our planned attendance at this event and they have started to engage with the business community in order to highlight the benefits of participation.”

Max Steinberg CBE, Chairman of the International Festival for Business 2014 and Chief Executive of Liverpool Vision has confirmed he will be visiting the Isle of Man for a second time in early November and will be making a presentation to the local business community.

Any interested parties such as businesses, local trade organisations or professional associations who want to know how to get involved with the International Festival for Business 2014 should email ifb@gov.im - www.ifb2014.com

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Douglas based family office and fiduciary services firm, Boston Group has been granted a full Trust licence by the Malta Financial Services Authority (MFSA) as part of an ongoing strategy for service development and expansion.

The licence complements and mirrors the Group’s full service offering in the Isle of Man. As a civil law jurisdiction, Malta is unusual in that it acknowledges and embraces the Common Law concept of equity and, therefore, Trusts. The creation of Trusts in Malta is not limited to those operating under Maltese law as a foreign proper law can be applied. Flexibility is further enhanced via the possibility of converting an existing Trust into a Foundation, which is not available in other jurisdictions.

Greg Ellison, CEO of Boston Group, commented: “Having received our Trust licence, we now offer the full spectrum of professional services in respect of Maltese Trusts and Foundations, alongside our existing corporate services for the core fiduciary, yachting, aircraft, eGaming, property and family office sectors. This is a significant development for the Group as a whole, offering additional flexibility to our international portfolio of clients and additional reach from the Isle of Man into a flourishing and world renowned jurisdiction.”

Trusts are a highly versatile solution which have existed in common law jurisdictions since the Middle Ages. The beauty of generational planning is that it continues unfettered after the settlor’s death, as opposed to the finality of a Will. This can be particularly attractive when considering the needs of beneficiaries without the constraints of forced heirship provisions, and when protecting spendthrift heirs.

A pro-active, well-regulated and business friendly jurisdiction, Malta is providing unique solutions to clients. Currently under review by the Maltese Parliament is a proposed article introducing the Private Trust Company concept for family offices, which will be exempt from the current requirement to be licensed. This proposal is a major step towards facilitating the establishment of family offices through the use of Trusts governed by Maltese law.

Westminster officer explores parliamentary outreach in the Isle of Man of the Commonwealth Parliamentary Association in advancing parliamentary democracy.

Ms Price said: ‘Coming from Westminster I was particularly struck by the more “intimate” scale of Tynwald and the ease of access to Members and officers, also the breadth of information available to the public through the Information Service and website.

Attending sittings of the House of Keys and Legislative Council was enlightening in that I saw how visitors are able to be in such close proximity to the proceedings – a very different dynamic from that of Westminster.

Houses of Parliament outreach officer Liz Price has completed a two-day study visit to Tynwald.

Ms Price, whose outreach work in Wales and the South West of England is aimed primarily at adults with learning difficulties and marginalised groups, attended sittings of the House of Keys and the Legislative Council, visited St John’s and met with senior officers and the Clerk of Tynwald and Juan Watterson MHK.

‘My visit has been extremely valuable and, in just two days, it became clear to me that heritage and history continue to shape much of the Manx way of life and identity, not least the institution of parliament and its links with the community.’

Mr Watterson said: ‘It is always good to meet colleagues from other parliaments visiting the Island to compare notes on where we can improve. It is also very satisfying when we can send someone away with a positive impression of the Island and some good ideas to take back to their own jurisdiction.’

The visit also provided the opportunity for Ms Price to witness Tynwald’s voice recognition technology in operation and learn of the important contribution made by the Isle of Man branch

RL360° and Appleby-sponsored STEP conference a success Over 100 delegates, including some of the leading names in trusts and estates and personal planning, attended the Isle of Man branch of the Society of Trust and Estate Practitioners’ (STEP) annual conference this month.

Held at the Mount Murray Hotel and Country Club, the event was jointly sponsored by Royal London 360° and Appleby Isle of Man and featured presentations from a range of experts in tax, estates and trust law, trust administration, accounting and financial planning. The speakers were Toby Graham (Farrer & Co), Jeremy Woolf (Pump Court Tax Chambers), Paul de Weerd (Isle of Man Financial Supervision Commission), Nicholas le Poidevin (New Square Chambers), Richard Hay (Stikeman Elliott) and John Spellman (Isle of Man Government).

RL360° Technical Consultant Nicola Holt said: “As always the conference was very well attended, which is a testament to its overall quality.

“It was a fantastic opportunity for members of STEP’s Isle of Man branch to hear what the speakers had to say on some very important subjects facing those in the industry.”

Appleby partner, John Rimmer added: “It was very gratifying to welcome over 100 delegates to the conference, particularly those returning to the conference for a second or third year.”

He continued: “Events like this help to cement the Isle of Man as leading jurisdiction for private client and trusts business and we will continue to work together with STEP to raise the Island’s profile further.”

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Investments

Isle of Man investors favour property and other investments over savings

• Isle of Man (IOM) investors positive about six-month outlook for UK property at 46% - compared to UK investors at 28% • UK Property most popular asset class among IOM investors - 46% positive outlook, followed by IOM property at 36% • Majority of IOM investors satisfied with their investments - 49% satisfied, compared to 17% in the UK • 33% of IOM residents ‘not very satisfied’ with their savings - compared to 4% ‘very satisfied’ Global Summary Some six years after the first signs of the financial crisis, uncertainty still reigns over much of the world economy. For many investors, predicting the future is fraught with difficulty. The Eurozone hangs like a low cloud over the world’s investment markets, with high unemployment and instability at the area’s periphery still a concern.

On the more positive side, growth is now more firmly entrenched in the UK and IOM and recovery continues in the US. The Lloyds Bank Summer 2013 Investor Outlook research suggests that investors are starting to see the light at the end of the tunnel, with the outlook for the medium-term almost uniformly positive. However, investors still see the emerging markets as risky, and with concerns about slow recovery in developed markets still prevalent, it remains to be seen whether investors have enough confidence to inspire the global economy to “escape velocity.”

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Isle of Man investors favour property and other investments over savings

Economic Outlook

The Investment Outlook

In the long-term, concerns over ongoing market volatility, inflation, and economic growth in the UK have done little to deter local investors from submitting a positive outlook for the UK and IOM. 42 per cent of IOM investors stated that they feel ‘quite positive’ about the UK economy over the next 3-5 years, compared to 31 per cent positive over the next 12 months, and 22 per cent over the next 6 months.

Looking six months ahead, 31 per cent of IOM-based investors anticipate positive growth in the stock markets, slightly lower than UKbased investors at 34 per cent and foreign investors at 44 per cent.

These stand in contrast to Eurozone investor’s sentiments about their own countries’ prospects, with 28 per cent of French and 31 per cent of Spanish investors stating a ‘quite negative’ outlook over the next 3-5 years, and 36 per cent and 28 per cent ‘neutral’ over the next 12 months respectively.

Among investors from the IOM, UK property is the most popular investment class. 46 per cent of IOM respondents hold a positive outlook for this asset over the next six months. This is followed by IOM property (36%), UK equities (31%) and commodities (24%).

In terms of an investment outlook for different markets, IOM-based investors are most positive about emerging markets with 40% saying they hold a positive view towards this market over the next 6 months.

This is followed by the US (38%), and Japan (27%).

Overall, IOM residents are relatively satisfied with the performance of their investments at 49 per cent, compared to those from the UK at 17 per cent.

Generally speaking, IOM and overseas investors are noticeably more optimistic than those in the UK over the short-term, with 22 per cent and 30 per cent positive over the next 6 months respectively, compared to 15 per cent in the UK.

Graph 1: Percentage of IOM-based investors with positive outlook on the following asset classes over next 6 months.

IOM and UK - Savings Despite a largely positive outlook for future investment opportunity, however, the majority of IOM residents remain dissatisfied with their savings. 33 per cent of residents reported being ‘not very satisfied’ with their savings, compared to the UK at 35 per cent. Indeed, just 4 per cent of IOM residents reported being ‘very satisfied’ with their savings, close to UK satisfaction levels at 6 per cent.

Sentiment levels out over the very long-term however, with UK, overseas and IOM investors submitting a 53 per cent, 50 per cent, and 49 per cent positive economic outlook over the next 10 years, respectively.

Global Risks

Table 1: How would you rate the outlook for the economy in the following timeframes?

Positive UK

Overseas

Next 6 months

15%

30%

Next 12 months

26%

3-5 years

Negative IOM

UK

Overseas

IOM

22% 40%

28%

40%

38%

31% 34%

24%

29%

43%

48%

42% 20%

18%

15%

10 years or more 49%

50%

53% 13%

12%

13%

Although it is largely considered the highest risk market, IOM investors are less concerned about Eurozone debt impact on the financial markets (30%) than they were at Q4 2012 (40%). 6 per cent of IOM investors surveyed had also increased their Eurozone holdings in the past six months, while 2 per cent had decreased their exposure. This compares to 12 per cent of UK investors who decreased their Eurozone investments over the past 6 months. 13 per cent of IOM investors consider economic growth in the UK and continued market volatility to represent the highest perceived risks to their investments over the next 12 months.

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Investment

René Thébault, the Islands Senior Investment Manager, Lloyds Bank said: “Investors remain skittish about the Eurozone and its volatility due to a string of bad news stories in the last couple of years. However, our outlook remains cautiously constructive towards Eurozone shares and we have been advocating a more overweight stance in the region.

“Our view on European equities is based on a steadily improving riskreward scenario. We have seen tentative signs of improving investor sentiment in the Eurozone, while sovereign fiscal concerns and other major macro-economic worries are gradually starting to dissipate.

Valuations of Eurozone companies remain reasonable, while profit forecasts have stabilised encouragingly. It should also be taken into account that investment in the Eurozone corporate sector provides exposure to more than just the Eurozone economy, as the index includes a host of high-quality global companies that aim to benefit from opportunities all over the world.”

Managing Portfolios 73 per cent of IOM residents continue to invest in stocks and shares, compared to 63 per cent of those in the UK. Unit Trusts represent the second most popular type of investment at 24 per cent in the IOM and 15 per cent in the UK. 22 per cent of IOM respondents increased their exposure to this asset class in the last 6 months, compared to just 17 per cent in the UK. 13 per cent in the IOM also expect to increase investment in this class, compared to 16 per cent in the UK. 23 per cent of IOM investors make changes to their investment portfolio annually, compared to 18 per cent in the UK, while just over half of IOM investors manage their portfolios themselves (54%).

IOM and UK investors are the least likely to seek professional financial advice than investors in other countries, although all investors rely primarily on their gut instinct and the media to inform their investment decisions.

Investment Strategies Investors disagree slightly about the most attractive world markets, with UK investors far more confident in the UK than investors elsewhere in the world. The IOM is far less concerned about the Eurozone than the UK. Many still believe that emerging markets present too risky a proposition. Over the last six months, investors have tended to increase their exposure to cash and the stock market, with government bonds out of favour.

Graph 2: To what extent do you agree or disagree with the following statement: “Emerging markets are generally too risky for me”?

Graph 3: Which one of the following World financial markets do you think offers the highest potential returns for investors?

René commented: “Investors have recognised the improving outlook for global equities, and are starting to adjust their portfolios accordingly.

While we would caution against over-exposure to any one asset class, our general view is that investors are heading in the right direction by tilting their portfolios towards the stock market and away from bonds and commodities at this time”.

“June’s price falls after the Federal Reserve’s announcement of quantitative easing tapering affected investor confidence negatively in the short-term. However, this was an orderly correction that we view as a natural, even a desirable event, allowing markets to digest and consolidate recent gains and help build a durable base for potential future increases. Prices recovered in July, and our current view is that equities will continue to outperform fixed income or commodities. This is due to an improving macro-economic backdrop, with rising indicators in manufacturing activity, labour markets, house prices and general financial conditions. As long as these conditions continue to prevail, we believe good relative valuations will continue to favour equities.”

Please note that the value of investments and the income from them can go down as well as up and cannot be guaranteed. Consequently, on selling, investors may not get back the amount they originally invested.

Important note: These comments are the opinion of Lloyds Banking Group (as at 14 October 2013) and should not be relied upon as fact, in particular, no responsibility or warranty is given as to the accuracy of any financial information or as to the potential for achievement or reasonableness of any forecasts, projections, prospects or returns.

Forecasts are opinion only, cannot be guaranteed and should not be relied upon when making investment decisions. The forecast of future performance is not a reliable guide to actual future results.

Past performance is not a guide to future performance.

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FAIRYTALE IT STILL FEELS LIKE A

TO WALK THROUGH MY OWN FRONT DOOR With our range of mortgage options, we’re proud to be helping the island’s first-time buyers onto the property ladder.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Lending is at the Bank’s discretion and you must be 18 or over to apply. Security will be required.

Lloyds Bank International Limited trading as Lloyds Bank. Registered Office and principal place of business: PO Box 160, 25 New Street, St. Helier, Jersey JE4 8RG. Registered in Jersey, number 4029. The Isle of Man branch of Lloyds Bank International Limited is licensed by the Isle of Man Financial Supervision Commission and registered with the Insurance and Pensions Authority in respect of General Business. Business Address: PO Box 111, Peveril Buildings, Peveril Square, Douglas, Isle of Man IM99 1JJ. Copies of our terms and conditions and latest report and accounts are available from the above registered office.

Technology News

Decoupling services from infrastructure developing a route plan for the shared journey IAN COMISH PRINCIPAL NETWORK CONSULTANT

Ian Comish, Sure Principal Network Consultant, looks at changes in terms of outsourcing to more managed services development and explores the trending technologies arising as business prepares for the move away from costly infrastructure to the Cloud.

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If one were to read all the outsourcing articles around, you might think that you could run an entire IT service without ever hiring a single employee! But there is more to outsourcing than the bottom line. At Sure International, our Professional Services team wants to offer partner technical relationships that identify the reasons for change and analyse the risks and rewards gained throughout the journey of decoupling service from architecture.

In any business, the reasoning behind outsourcing is an emotive subject. In leadership terms, a “thousand feet view� of outsourcing revolves around controlling operating cost, headcount, focus and risk. This becomes difficult to manage as technologies become more social and user friendly but also becomes more complicated to manage as manufacturers converge the market technologies and verticals. A more grounded view is usually more defensive given the eventual outcome of Cloud and outsourcing. Asking

the proverbial turkey to vote for Christmas isn’t easy, but when you talk to IT teams that are walking the outsourcing path and facing the inevitable oven, the story is different.

So what are the risks? Are all systems easily outsourced given the degree of bespoke operation and level of skills locally available in a limited island landscape? Will employed staff become disillusioned and feel they are losing control? Will moving to a fully managed service make it a virtual impossibility to move vendor at term or have too much impact on the business to change?

Of course all of these questions need to be researched and discussed internally and in partnership with suppliers.

Managing change Focusing on the negative is always inevitable in preparation for, or during, periods of change. But what are the rewards? Reducing pain, cost, risk and worry is something everyone aspires to and wishes for in their complicated existence. When talking to technology

...the path or journey to Cloud and outsourcing is set by the needs of client businesses.

and support teams that are outsourcing and virtualising, their positive experiences range from more headspace, better vendor relationships to widening general IT skills whilst being able to focus on more personalised and specialised IT interests.

Directors are enjoying commercial and technical partnerships bringing the comforts they need around risk and control. Mutual satisfaction is also born out of concentrated access to high-quality, specialised individuals without burning-out locally employed teams.

So as we move to the “inevitable” virtual Cloud existence, what are the trends in the market place for this update?

Well private customer network and server virtualisation is in full flow and Sure is working closely with partners and customers re-trenching and re-engineering networking platforms to accommodate “Private Cloud” migration and consolidation. The Sure network teams are virtualising networks and switching platforms in the same way that server architectures are evolving to smaller clustered and virtual existences. High utility cost, ”local site” server rooms are leaving customer sites en-route to data centres in “cookie cutter” fashion now that customers control and standardise IT deployments in a more structured manner.

The strength of wireless One of the most exciting changes of this decoupling from “structure” is the traction that Wireless or Wi-Fi networking is experiencing. Demand for wirelessly networked PC and telephone is exploding as the Wireless “N” standard has finally been

ratified, offering speeds of up to 450mb “through the air” for most devices.

Wireless “AC” standards are still on the horizon offering potential speeds in the gigabits, but “N” is facilitating the need for bandwidth and “higher than LAN” security as the BYOD phenomenon forces ubiquitous client access. Customers are looking for more interactive connectivity to the world. “Open” Guest Wireless access has proved to bring uncontrolled reputational risk and now controller-based solutions finally bring private “authenticated guest” and “corporate network access” with the strongest encryption and authentication controls.

LAN and structured cabling has never been able to satisfy the security that Wireless has, inevitably, had to deliver given its nature. Again our teams have been furiously surveying, deploying and offering best practice advice when designing and securing customers’ Wi-Fi networks.

Resistance is futile In conclusion, the path or journey to Cloud and outsourcing is set by the needs of client businesses. Already, forwardfacing customers are decoupling from infrastructure and fixed structure networks in search of a more efficient, flexible and user friendly IT experience.

products in Sure’s and partner data centres.

As a full-service global provider, Sure has delivered a Multi-service, Multi-point and Differential Services Next Generation Ethernet network to facilitate private, perclient, “As a service” network access.

Next steps for any business should involve rallying support and forming a clearly aligned strategy that delivers a route plan through Private Cloud to arrive at a decision point for full or partial outsourcing. If you would like to know more about the journey to Cloud, simply contact your account manager at Sure, or if you are a new customer, call the business team on 01624 692242 or email them at business@sure.com and they will be more than happy to help.

Your account manager will work with you to fully understand what it is you are trying to achieve. Once the account manager has understood, he or she will then bring in the Professional Services team, who will design a solution that meets your needs and budget. Sure will install the solution to the highest possible standards and will maintain a close relationship with you, keeping you aware of your options and giving you somebody to speak to, whenever you might need them.

Resistance is futile...! Negative change apprehension should be swiftly dealt with for a quicker, less painful route to Cloud technologies as fixed, wireless and mobile technologies converge for ubiquitous services access. Cloud vendors already have “As a Service” infrastructure and application

12

Entrepreneurs WORDS

LES ABLE

THE RESTLESS ENTREPRENEUR

with an eye for a calculated risk jurisdictions such as the Isle of Man, with the aim of connecting entrepreneurs with angel investors, governments and service providers. Since July 2011, Siliconiom has hosted 18 such events in the Isle of Man and the next one is due to take place on November 11.

STEVE HAWKINS SILICONIOM

A glut of retired ‘smart money’ investors who became multimillionaires after selling the successful companies they had created in the UK and beyond are now using their considerable nous to help attract budding entrepreneurs to the Isle of Man. “They are the entrepreneurs of yesteryear who have been there, done it and having ‘retired’ here to the Island, often at relatively young ages, are now rolling up their sleeves by getting involved in fledgling ventures, frequently in non-executive roles,” says facilitator and entrepreneur extraordinaire Steve Hawkins.

“An entrepreneur is someone with skills and abilities, who isn’t constrained by one particular direction and is a free thinker.” says Steve, whose own CV and pedigree identifies him as a restless entrepreneur from his early working years and someone who is prepared to take a risk, but only a calculated risk.

He is one half of Siliconiom, which hosts entrepreneur events in offshore

13

The company’s achievements make impressive reading in that close on 40 companies which have pitched to potential investors in the Isle of Man have obtained their required funding, a number are in dialogue with government with regards to grant-funding and possible relocation to the Island.

It is Steve and London-based business partner Charlotte (Charlie) Mason who identify those entrepreneurs from the UK who may have a business offering which will whet the appetite of ever hungry investors on the Island. They are then invited to attend an event where they, in ‘Dragon’s Den’ style, will make a pitch for investment to an audience of potential investors. Guests will also include Ministers, MHKs and Government advisers.

“While we want to encourage new business blood from the UK to consider the Island and all it offers as a location for their business, we are also aware of indigenous young entrepreneurs and come next year.

Siliconiom will be focusing on this talent and a scheme already in the pipeline will be announced early next year to identify an entrepreneur to participate in our May 2014 event.”* Born in Bristol, where he grew up, Steve initially embarked on a career in estate management and then joined a global PLC specialising in the valuation and sale of leisure and hospitality properties.

The downturn in the property market in the late 1990s saw him change tack. He then retrained and became a specialist in corporate pensions and latterly offshore investments while working for a well known life assurance company.

Ever ambitious, and something of a rolling stone and one who certainly never gathered any moss, it was the world of international wealth management that beckoned. This saw him move to the Isle of Man to become business development manager for the offshore arm of Lloyds TSB. “It was a great job but international travel can take its toll when you are married and have a young family, and after three years I made the decision to focus on a career closer to home and co-founded

an investment advisory business which a few years later was acquired by a Top Ten accountancy firm.”

Much of Steve’s working life has been in phases of three years and while he was retained as managing director, the all too familiar three-year itch saw him seek out other opportunities. He is now at the helm of a number of vertically connected businesses. There is Paradigm which provides asset financing solutions for yachts, ships and aircraft as well as mezzanine finance for UK property development.

“We aren’t necessarily dealing with the mainstream banks, but those banks which still have an appetite for such purchases, along with institutions and companies that want to raise finance,” he says.

“The Isle of Man is a mecca to a number of firms with regard to clients who want to finance yachts and aircraft. Not so long ago I was asked to assist a UK company which was looking to establish an e-gaming presence in the Island and part of their requirement was to source the finance so we were able to facilitate that and also partner them up with a local company and introduce them to people in government.”

Now aged 46, Steve admits that he can adapt to change quite easily. “I am by nature quite inquisitive, if I see a door ajar then I will push it open.”

So what advice does he give to potential entrepreneurs? “Integrity, transparency and the ability to look outside the box.

What frustrates me are people who aren’t open to new ideas and instead erect barriers. Nor do I think everyone has to be an academic and have a career in banking or finance to be successful. It’s possible to be an achiever in anything.

“I went to a State school and didn’t go to university, which was then more the exception than the rule. I believe that in today’s world and to face all the challenges of the 21st century degrees should be more meaningful and applicable to what an individual want to do for a job.”

His final words of advice are: “Too many young people opt for gap years, my advice is that it’s more important to get a decent job.” *If you are a local entrepreneur and would like to find out how you can participate in the early 2014 event than please email steve@siliconiom.com for further details.

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Patek Philippe International Collection 2013 - Jar Restaurant, Douglas Wilkins the Jewellers of Strand Street, Douglas played host to a never before seen on the Isle of Man showcase of watches in an exclusive showing of the Patek Philippe International Collection 2013.

AGENDA

A-LIST EVENTS

15

The collection contained some of the most covetable pieces from the Swiss watch company and gave guests the chance to try on and marvel at the exquisite craftsmanship that Patek Philippe are world renowned for; including the Ladies Split Second Chronograph that houses one of the most complicated and intricately designed movements in horology.

The Dining Car - Douglas Station President of Tynwald, The Hon Clare Christian, officially opened the Dining Car in front of invited guests at Douglas Station on Saturday 26 October.

Graham Cregeen MHK, Minister for Community, Culture and Leisure, welcomed everyone to the platform. Guests included Infrastructure Minister David Cretney MHK – a former Minister for DCCL – and Geoff Corkish MLC who is a Member of the Department.

Prior to cutting the ribbon to declare the Dining Car open, Madam President said: ‘The standard of refurbishment of the carriages is extremely high. I am very impressed with the way in which the railways have been developed in the last few years in terms of imaginative ways to bring back the public and I think all commendation needs to be made for that.’

16

Business Profile

Still kickin’ up a storm, 20 years on Life’s never dull at Typhoon House, but when you get to know the owners, staff and even the resident office dogs, you begin to understand why.

GEOFF & DEBS TYPHOON HOUSE

17

Celebrating 20 years of business on the Island, Typhoon House are one of the Island’s premier printer sales, servicing and consumables suppliers. Working now from their purpose built office and warehouse on Hills Meadow in Douglas, you would probably expect an air of normality, sanity and utter professionalism.

And that is of course exactly what you get, right up until the point you enter their impressive atrium style reception and are met with a great big, shaggy headed dog leering down at you from the balcony, tongue lolling – a big, fluffy Old English Sheepdog called Cloud, rather apt for a company named after a natural disaster!

Cloud is of course just the start. There’s a lot more to follow. Take the owners of this successful local employer, known affectionately by friends and clients simply as Geoff and Debs. Both with amazing backgrounds ranging from aerospace engineering in the far flung corners of the globe to Marketing Manager for global giant Disney, their combined talents and philosophies culminated in the creation 20 years ago of a company called Caledonia Ltd. Geoff, a cross between David Bailey and Mick Jagger, had taken (very) early retirement from his career as Quality Assurance Manager for Cathay Pacific and moved to the Island. On his travels, he came across an organisation specialising in laser printer sales and recycled toner cartridges, long before the green movement had gained notoriety. He liked the business model so much that he set up a local franchise and started supplying local businesses.

Geoff, a fully-trained engineer, was owner, sales person, accountant, repair man and chief bottle washer. For the business, already employing a handful of staff, to really take off, he needed support.

Enter Debs. Having helped guide Disney’s branding for many years, she knew a thing or two about sales, marketing and business development. Part human dynamo, part wild eccentric, Debs tore through the business like a typhoon – something that the current name of the business is no doubt closely linked to. They set up shop in their little Onchan office, next to the Methodist church. With plenty of local and off-island competition, it took time for their unique take on customer relations to gain real traction. Their model, based entirely on the way they would like to be treated by a supplier, proved extremely popular and brought new levels of customer service to the Island. Heavy investment in state of the art computerised systems to ensure maintenance plans were effortlessly managed and sat well with their investment in one of the very early Customer Relationship Management systems. All combined to deliver what they wanted, an amazing and completely hassle free customer experience. It was their big ‘hook’, and the bait was exactly what the market wanted!

Fast-forward a few years and you’ve bypassed rebranding and renaming projects (but all still under the Caledonia Ltd. parent company), a constant evolution of the businesses services and products to meet the ever changing local business demands – and of course, a few more wrinkles. You’ve also bypassed their meteoric rise to become probably the Island’s largest specialist supplier of printers and consumables, coupled with its own highly trained team of engineers, who are constantly deployed Island-wide giving local businesses printers some ‘love’ – they don’t call it ‘servicing’ obviously!

And it’s not just a story about the chance meeting between two rather eccentric but well-loved local business characters.

In the last two years, aside from moving to their new offices, they have employed both their youngest ever apprentice Ryan, just 16 years old, and oldest, Trevor, who saw his half century pass more than a few years ago. These have joined a workforce boasting staff that have been there since the very start – which kind of speaks for itself in the way they run their business.

And this is one part of this very unique businesses lovable traits; there are no heirs or graces, no chains of command and no prejudices regarding age, sex, race, creed or even breed (of dog) – although they do perhaps favour Old English Sheepdogs!

So, perhaps the best way to round off this latest chapter in their history is to find out why the new name, ‘Typhoon House’? Of course, as you would expect with someone of her experience, Debs has many commercially astute reasons why the brand and name needed a refresher. But, halfway through explaining the exhaustive and carefully crafted marketing strategy, Geoff pipes up, “It was simple, we thought we could have a load of fun with it, everything from ‘you only get an oooo with Typhooooon House’ through to ‘we’re kickin’ up a storm’”.

Debs goes quiet. She looks at Geoff with that quizzical, half smiling expression and replies, “Yes Geoff, thank you for that”. Cloud looks up at the two of them, scratches his ear and, after a big sigh, curls back up under Debs’s desk and falls asleep. All is well in the world.

So, if you ever venture into Typhoon House, at least you’ll know beforehand why the experience may not be exactly what you were expecting – but ask any of their hundreds of local clients, and you’ll struggle to find one that would want them to be any different. www.typhoonhouse.im

Connect with us.

Introducing Sure International.

Partnerships, relationships, affiliations. Whatever you call them, all companies need good connections.

We’ve made a new connection - we’ve been bought by the Batelco Group, a communications company with a global footprint and vast expertise. And we’ve changed our name from Cable & Wireless Communications to Sure International.

Our new group structure, coupled with local experience and know-how, make us a perfect connection for your company.

Contact Gavin Price on 01624 692242 or email business@sure.com

www.sure.com

Feature

WORDS

MICHELLE P. TONNESEN

Corporate culture can have a huge impact on an organisation’s work environment and output.

...the Key to Success Corporate culture is one of the key drivers for the success - or failure - of an organisation. A good, well-aligned culture can propel it to success.

However, the wrong culture will stifle its ability to adapt to a fast-changing world. Real life examples of strong and successful corporate cultures are plentiful: Apple, Google, McDonalds and IKEA. So, how do you attempt to understand your corporate culture? And what steps can you take to create a strong corporate culture that will best support your organisation’s activities?

Several different models and theories exist of corporate culture. Key elements to most of them are:

History – A shared narrative of the

past lays the foundation for corporate culture. The traditions of the past keep people anchored to the core values that the organisation was built on.

Values – Cultural identity is formed around the shared beliefs of what is really important, and the values that determine what the organisation stands for.

Rituals and routines – The daily behaviour and actions of people that signal acceptable behaviour. This determines what is expected to happen in given situations and what is valued by management. It is also the things that bring employees together, such as social events on Fridays, pasty for all on birthdays, or simply saying good morning to everyone when entering the office.

Stories – The past events and people

talked about inside and outside the company. Corporate stories typically exemplify company values, and dramatically capture the exploits of employees who personify these values in action. Stories allow employees to learn about what is expected of them and better understand what the business stands for.

Heroes – Related to stories are the

employees and managers whose status is elevated, because they embody organisational values. These heroes serve as role models and their words and actions signal the ideal to aspire to in a company.

Symbols – The visual representations of the company including logos, how flashy the offices are, and formal or informal dress codes.

Structures – This includes both the

structure defined by the organisation chart, as well as the unwritten lines of power and influence that indicate whose contributions are most valued. The people who make or influence decisions may not be the ones whose names are on the door to the board of Directors.

Culture often becomes the focus of attention during periods of organisational change – when companies merge and their cultures clash - for example, when growth and other strategic change means that the existing culture becomes inappropriate

and hinders rather than supports progress.

In more static environments, cultural issues may be responsible for low morale, absenteeism or high staff turnover, with all of the adverse effects these developments can have on productivity. So, for all its elusiveness, corporate culture can have a huge impact on an organisation’s work environment and output.

However, in the dire times of a downturn, we feel compelled to make a choice between doing the “right thing” and profit; and we inevitably pick profit.

When push comes to shove, we start to see conflicts between what is often perceived as the “softer” aspects of corporate life and our drive to improve the bottom line. We choose control over empowerment. We dispense with the perks and free lunches and start to browbeat employees into greater productivity. We respond to external threats by locking down and cutting back.

However, research has shown that those “extras” that we dispense with so quickly, albeit regretfully, are the very things that will lead directly to the specific results we need. This is not a subtle correlation – it is a strong, undeniable one. Organisational culture directly impacts the bottom line.

What’s your situation? Is your company growing or established? Does it compete on price or on innovation? Is your industry mature and stable, or new and evolving?

With those questions in mind, answer this: What are the cultural elements that you need to encourage in your organisation to build a high-performance culture, and how will you do it? Once you have these answers, really commit to their implementation. Any change that is not permanent and pervasive won’t do it. It has got to be real. It has got to become part of the air your employees breathe. Your corporate culture is key to the identity of your company – how you want to be perceived internally and externally – and essentially what differentiates you from your competitors. Find that key and unlock your true potential to support you in the bad times and excel you in the good. Using your corporate culture proactively, you can create an environment that encourages success, supports the organisation’s objectives and ultimately makes for a better place to work.

20

Jersey In The News the talk, which took place on Monday 14th October at the Grand Jersey, with staff in Guernsey and the Isle of Man also joining the talk via video link-up.

IRENE DORNER HSBC

CEO of HSBC USA discusses diversity in the workplace to Jersey There are opportunities for women to pursue successful career paths in the modern business landscape if they are clear about their aspirations and are prepared to adopt a positive approach to risk, according to the head of HSBC Bank’s USA operation who was in Jersey recently.

Irene Dorner, Group Managing Director, President and CEO of HSBC Bank USA, was in Jersey to talk to HSBC Bank staff on behalf of the Bank’s Women’s Development Association (WDA) and to coincide with the Bank’s ‘Diversity and Inclusion Awareness Month’. Over 110 male and female employees attended

Speaking about her career progression with HSBC, Irene, who was named the ‘Most Powerful Woman in Banking’ by American Banker magazine in 2012, explained how she started as an in-house lawyer before working for the Bank’s Treasury and Capital Markets business.

She was then made responsible for the Bank’s branch network in the north of England, Scotland and Northern Ireland, before being appointed Deputy Chairman and CEO of HSBC Bank Malaysia and eventually being asked to oversee the whole of HSBC’s USA operation. Her main message to staff was to have confidence in their abilities: “In the past, career progression for women has been opportunistic and I have frequently found that women will put obstacles in their own way and count themselves out of a potential job move before even applying.

However, there are real opportunities for women to progress in the careers they want and the roles they deserve.

“Adopting a different attitude and seeing change as a positive opportunity rather than a negative upheaval is one really important area that women should focus on. In addition, women shouldn’t be afraid of being direct and telling their managers clearly what they want to achieve careerwise. Bosses aren’t telepathic and being clear about job aspirations can help clear up any misunderstandings. In my

experience, that sort of direct approach is welcomed by senior executives.

“Across all business sectors, it’s a cold hard fact that the career landscape is not a level playing field all the time, but every single policy HSBC has in place is geared towards embracing diversity, rewarding talent and making that playing field as level as possible. Ultimately, for a bank to be open to everyone makes very good commercial sense too.”

The Jersey branch of the Bank’s WDA was launched in 2009 and provides a forum for the discussion of issues affecting women in business today, specifically aiming to help empower female employees to reach their full potential, both professionally and personally.

Introducing the event, Nick Winsor, Chief Executive Officer, HSBC Channel Islands and Isle of Man, said: “Over 50% of staff at HSBC are women and the WDA provides an excellent means for them – and their male colleagues – to understand different approaches to careers. In addition, drawing on the kind of issues affecting women helps us to focus our learning on other aspects of diversity in the workplace too, which is clearly to all of our advantage.”

HSBC’s WDA in Jersey organises regular workshops and events for its staff throughout the year, covering personal development topics such as body language, mentoring, career management and image in the workplace.

Employment Tribunal Fees Could Be Useful in Jersey Following the introduction of fees for employment tribunals in the UK, the question arises as to whether Jersey should follow suit. Under the new UK law, employees will now have to pay up to £250 to lodge a claim, as well as a further charge of up to £950 if it is decided the case will go ahead. Christopher Austin, a litigator who specialises in employment law at Parslows believes that introducing the fees in Jersey could be a useful idea but it would need to be managed carefully: “Jersey needs to maintain a balanced approach to introducing employment tribunal fees. They could prove to be very useful for ensuring that spurious claims are kept to a minimum and are likely to be welcomed by employers, many of whom currently feel that there is no barrier for entry of complaints”. “However, employees who lack the funds to pay fees could experience problems as those with genuine claims could be denied access to employment tribunals and therefore be denied access to justice. There’s no doubt that this is an idea worth investigating here in Jersey but a proper consultation will be needed to ensure the interests of employers are balanced by the need to have a fair system accessible to all.”

Jersey Brands Cast Thier Net into Caribbean Waters After announcing an association with Carey Olsen in January, Hempel and Boyd has rebranded taking the Carey Olsen name in the jurisdiction. Chairman, John Kelleher, said the move to bring Hempel and Boyd into the Carey Olsen brand was a natural progression. “Hempel and Boyd has presented a strong growth story in the BVI market since its inception in February 2012 when Clinton Hempel and Greg Boyd first launched the firm. Indeed in the same year, Hempel and Boyd became the first of shore law firm to open an office in Cape Town. We welcome this next step of embedding the association between our firms and look forward to continuing to provide our clients with the highest standards of legal advice around the world.” Carey Olsen provides British Virgin Islands, Cayman Islands, Guernsey and Jersey legal advice and has offices in each of these locations as well as in Cape Town and London.

A Certian Affinity Affinity Private Wealth, the Jersey-based wealth management business hires in their trust business. Affinity Trust Limited has further expanded its team with the recruitment of Paul Sewell as a Director. Managing Director of Affinity Trust Limited, Justin Thomas said “Our client base has grown and continues to do so. This has resulted in our desire to expand the board and recruiting talented individuals of Paul’s standing and calibre is integral to the future of our business. Paul has consistently delivered a first class professional service to private clients for several years and Affinity are delighted he has chosen to join us as we continue to expand.” Paul brings with him a wealth of experience having most recently been a Director of Key Trust (now acquired by Hawksford) prior to that he was a director at Vistra Trust, CitiTrust (Jersey) Ltd. and in various roles at Walbrook Trust.

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Appleby Reports Positive Offshore M&A Activity •

Surge in M&A activity and IPOs for Q2 2013

•

Offshore market outlook positie with business confidence stabilising

•

Isle of Man deal values up 46% on previous quarter

NICK VERARDI APPLEBY

The second quarter of 2013 has shown positive signs of a return to more stable transactional activity following several years of volatility. Renewed confidence in offshore transactions and an increase in deals between Q1 and Q2 2013 have been highlighted in the latest Offshore-i Report released by Appleby.

The latest edition of Appleby‘s quarterly report, which provides data and insight on merger and acquisition activity in major offshore financial centres, focuses on Q2 of 2013 and shows that the Crown Dependencies enjoyed a positive quarter. Whilst deal volumes in the Isle of Man were down from 20 to 18 compared to Q1 2013, the value of the deals was considerabley higher, up 46% from USD194m to

Offshore Reports

USD283m on the previous quarter.

Central and South America at USD109m.”

Offshore M&A activity in the second quarter of 2013 presents a relatively positive picture, with both the number of deals completed and their value remaining broadly consistent compared with Q1.

This suggests that there may be some stabilisation of transactional activity levels after the volatility of the last few years.

“When we look at the contribution of the top 10 offshore deals to overall activity in Q2, we see that they accounted for just a third of the cumulative deal value overall, as they did in Q1. We believe that this gives further reason for optimism as values for past quarters have been distorted by one-off mega deals. We can now see genuine substance returning to the mid-market and activity returning across the spectrum of business sizes. Transaction sizes show signs of settling at pre-boom levels, on a par with 2006 data, when USD61m was spent on the average transaction.”

Commenting on the report, Nick Verardi, Head of Corporate and Commercial at Appleby (Isle of Man) LLC said: “The numbers speak for themselves, but I am in no doubt that the Isle of Man market is in a more positive mood in line with our other offshore jurisdictions.

Isle of Man companies were the target of nine deals in Q2 with an aggregate deal value of USD449m, and we believe this indicates stability and confidence returning to the market.”

He continued:”The number of deals has started to form a pattern averaging out at around 500 per quarter. So far this year we have seen 493 deals in Q2 and 491 in Q1. We feel comfortable asserting that business confidence is at last returning to the markets.”

“At USD64m for Q2, average deal size is higher than it has been for five of the last eight years. The offshore region average is also higher than all other regions except for North America at USD119m and

Global Offshore Market: Q2 2013

Cameron Adderley, Partner & Global Head of Appleby’s Corporate & Commercial department added: “When we look to gauge the relative strength of the offshore markets as compared to other major world regions, this quarter we find these numbers are encouraging. The offshore markets are now ranking sixth globally in terms of cumulative deal value, only just behind South and Central America.

The offshore market is more active than Oceania, Africa and the Middle East and, when we look at average deal size, here again we find a source of positive news; the offshore region ranks third globally, behind only North America and South and Central America in Q2 2013.”

•

Finance and insurance deals continued to drive the offshore M&A markets at 168 deals with a combined value of USD10bn.

This is up quite considerably on Q1 2013, when there were 147 deals in the sector worth USD6.5bn.

The key themes emerging from the report show that in the second quarter of 2013: •

There were 493 deals involving offshore targets completed with an aggregate value of USD31.6bn, putting the quarter slightly ahead of Q1 2013.

•

The most popular deal type was the minority stake transaction, of which there were 295 that contributed USD11.5bn to the cumulative deal value for the quarter.

•

The average offshore deal size was USD64m for Q1 2013, the same as for 2013 to date. If this is maintained or improved to the year end, deal sizes in 2013 would be greater than they have been in at least five of the last eight years.

•

Hong Kong acquirers spent the most money in Q2 2013, with an aggregate deal value of USD13.7bn that represented 40% of total spending by offshore acquirers.

•

•

Acquisition activity led by companies incorporated offshore rebounded in Q2 2013 after a weaker first quarter, and there were 426 deals with a cumulative value of USD34bn, up 11% in terms of volume and 29% by value.

By average deal size, the offshore region ranks 3rd globally, behind North America and Central and South America in Q2 2013.

•

Initial Public Offering activity is looking increasingly bullish, with both the volume and value of IPOs up considerably in Q2 2013 with 17 deals and a cumulative value of USD2.4bn.

•

Q2 2013 was the best quarter since 2011 for IPOs and planned IPOs, with 39 deals in total worth USD4.1bn.

•

In Q2, there were only three deals announced valued in excess of USD1bn. Instead, the majority of money was spent in the mid-market on transactions valued at between USD200-700m.

We see this strengthening of the mid-market as a crucial step towards recovery.

“These numbers are encouraging,“ says Nick Verardi, “the offshore market is showing signs of stability and the emergence of a new norm.“

22

Feature WORDS

MICHELLE P. TONNESEN

Buzzwords and

Management Fads Hip or Hype?

Who Moved My Cheese?

The Seven Habits. Six Sigma. In Search of Excellence. You may be forgiven for thinking this article is about children’s games or TV shows. The creativity of the management fashion industry seems to have no end when it comes to inventing new business philosophies for managerial circles. But are the so-called gurus just out to take advantage of self-doubting managers in the name of profit?

Or, do their tools and rhetoric have some merit?

Get out your Buzzword Bingo card, because you are in for a treat!

The term ‘management fad’ tends to be used in a pejorative sense as it implies that such a change in philosophy or operations is being implemented solely because it is THE thing to do at the moment among high-performing companies – and not necessarily due to any real need for organisational change.

It also implies that when this idea is no longer popular, it will be replaced by the next plausible idea that comes along.

What characterises a management fashion? For starters, there is the new jargon it implies – usually for existing business processes. Enter the notorious three-letter acronyms: BPR, BPO, JIT, TQM, CRM, HRM – and so the list goes on.

The rhetoric not only creates a belief that the techniques the theory champions is rational, but also that it is at the forefront of management progress. It poses claims of a measurable business improvement via measurement of a metric that is defined by the fad itself.

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Top it all off with a captivating figurehead like Tom Peters, Anthony Robbins or Stephen Covey and you’re good to go.

Whenever a new theory pops up, the question inevitably lingers at the back of your head: Have we not heard this before? Well, you may have a point. Strip away the rhetoric and look at what is left: Improvement – in a plethora of guises.

‘Business Process Reengineering’ became Lean. ‘Knowledge Management’ inspired Customer Relationship Management. ‘The Learning Organisation’ succeeded Total Quality Management. Old wine on new bottles? We’ll leave it up to you to judge.

Charismatic gurus and shiny book covers may be seen as representing flavourof-the-month techniques, yet managers feel obliged to pursue them (and make them bestsellers) for a reason. It’s cold and lonely at the top. They provide a helping hand to engage in a brief standing back from the everyday pressures and encourage you to reflect on what you are doing in a more or less structured or inspiring way. Doubting yourself and your actions is only human nature – we all have our moments of uncertainty regardless of our place in the corporate hierarchy.

Using these ideas to make sense of your life and your place in the scheme of things enables you to take control. The gurus can be seen as equivalent to the priests of organised religion or the witch doctors of tribal societies – their roles being to assist their clients with pressing problems and anxieties with magical words, knowledge or techniques. Gurus acknowledge and respond to the individual manager’s need for a measure of predictability in an increasingly uncertain world. They provide this through their philosophy by helping the manager make sense of his or her business environment.

The socio-economic, political and cultural contexts within which management theories and ideas emerge and become widely adopted play a significant role too. Management fashions centred on reducing costs fare well in a recession;

softer, people-focused ideas thrive in cycles of economic expansion.

And some theories just work. In a highly competitive and turbulent environment, organisations will seek out new ideas in order to survive. Those that select the right ideas stay alive; those that don’t fall by the way.

At the end of the day, it is all down to believing and methodically pursuing your beliefs. The words may be buzzing, but if you don’t put action behind them and follow through, they are nothing but the infamous new clothes of the emperor.

Acronym Glossary (just in case you need a reminder) BPR: Business Process Reengineering – a business management strategy, originally pioneered in the early 1990s, focusing on the analysis and design of workflows and processes within an organisation.

BPO: Business Process Outsourcing – a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions (or processes) to a third-party service provider.

JIT: Just In Time – a production strategy that strives to improve a business return on investment by reducing in-process inventory and associated carrying costs TQM: Total Quality Management – an integrative philosophy of management for continuously improving the quality of products and processes.

CRM: Customer Relationship Management – a model for managing a company’s interactions with current and future customers. It involves using technology to organise, automate, and synchronize sales, marketing, customer service, and technical support.

Finance Feature

Money Talks Brought to you by Edgewater Associates Limited

Ray Cox, Owner of Douglas based Milan Veterinary Clinic, talks about how he manages his finances.

Have you ever been hard up?

For 5 years in recession hit Ireland in the ‘80s when I was studying at vet college.

Whilst we were cash poor we had a great time. The second period of penury was when I purchased my veterinary practice in 1997. I worked without a break for nearly a year, being on-call 24 / 7.

How much money do you currently have in your wallet? £25; I rarely carry much cash.

Do you manage your own financial affairs?

I have always had a keen interest in financial matters. Nowadays, I take advice from Sandra Cardwell at Edgewater Associates and from accountant Colin Matthewman of Callow Matthewman & Co. Are you a saver or a spender?

Saver.

How often do you save?

I constantly save regular amounts and then lump sums.

RAY COX, OWNER, MILAN VETERINARY CLINIC

What is your weakness when it comes to saving?

I am fairly disciplined.

How do you plan for large purchases, such as a car or a house?

I plan purchases and save the bulk of the money before buying.

What was your first ‘scary’ purchase?

My first house came with what I thought at the time was a vast mortgage. However, with the passing of time it seems so small now.

What’s the most extravagant thing you’ve ever bought?

The horse lorry.

How do you manage your outgoings?

With difficulty, having a wife and 4 children.

What is your most costly regular outgoing?

Paying for the ponies.

Do you invest in shares?

Yes, via investment platforms that spread the risk.

It is wise to be prudent but don’t let money rule your life. You cannot take it with you to the afterlife What, in your opinion, is the best type of investment?

Property at the moment but equities in the longer-term.

What is your current market outlook?

The market has tightened somewhat on the Island over the last 2 years. However, it appears to be recovering slowly.

Do you own more than one property?

Yes. What, in your opinion, is the best way to save for retirement?

Start early as even a small investment will build up. Now I have a Self Invested Personal Pension (SIPP) with a mixture of property and investments.

What is the most important thing you have learned about money?

It is wise to be prudent but don’t let money rule your life. You cannot take it with you to the afterlife.

“The most relaxed game of golf I ever played was the day after Edgewater sorted out our key person insurance.”

Business protection from Edgewater - giving you time to relax.

Talk to us on 01624 654000 or email enquiries@edgewater.co.im for more information.

Shaping your Financial Future

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