6 minute read
Interview - DGM Financial Group
COMPREHENSIVE CORPORATE SERVICES
By Daniel Baksi
Sustainable Business Magazine speaks to Wayne Fields, President of DGM Financial Group, about the competitive business environment in Barbados, the impact of the COVID-19 pandemic, and trends within the services industry.
DGM Financial Group has been providing comprehensive global financial services to clients across the world for over 20 years. A Listing Sponsor on the Barbados Stock Exchange, the group is owned jointly by Cave Shepherd and Company Limited and Neville Isdell, former Chairman and CEO of Coca-Cola. DGM provides a range of services across multiple companies, including incorporation, directorships, secretary and immigration services through the DGM Trust Corporation, and captive insurance and general management services through DGM Captive Management Inc. and DGM Management Services Limited.
“At DGM, we pride ourselves in security and trust,” says Wayne Fields, President of DGM Financial Group. “We have a broad variety of clients across different sectors and industries, from mining to nonprofit organizations, and insurance companies. Our staff are all trained to recognize that we’re dealing with high-net-worth individuals and corporate clients that are setting up structures in Barbados. In all cases, providing quality service and integrity is vital as we look to drive forward the development of our business.”
COMPETITIVE EDGE
The development of Barbados’ financial center has been a stark contrast to the typical model for an offshore financial center. “To take places like Cayman and Bermuda as a comparison, those islands are zero-tax jurisdictions, catering to a very small domestic population,” explains Mr. Fields. “Those islands are able, without providing corporate tax or personal income tax, to fund their Government budget. By contrast, Barbados is a much larger country; we’re home to almost 300,000 people, compared to the small population in Cayman, and the government has historically set high corporate and income tax rates to fund the Government budget. The benefit of Barbados having a tax system is that the country has been able to negotiate tax treaties with countries around the world, such as the United Kingdom, United States, Canada, and many other European countries. Without taxes, you couldn’t have a tax treaty.”
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The focus of the country’s efforts has been on nurturing its corporate sector. “In 2019, Barbados converged what we then referred to as our domestic legislation with our international legislation,” says Mr. Fields. “With that, corporate tax rates reduced considerably from 25 to a maximum of five-and-a-half percent, which helps to make Barbados very competitive. Added to that, Barbados has a size, population, and an educational system that allows us to develop Barbadians to work within the financial services sector and not rely on expensive expatriates. Looking at all the major accounting firms in Barbados, with hundreds of staff members, there are very few expatriates, thanks to the availability of well-educated people in Barbados. Smaller jurisdictions don’t have that advantage; they have to bring in a great number of people with expertise at very high cost. The end result is a cost differential: Barbados is substantially less expensive to do business than many of these other jurisdictions.”
RESILIENT SERVICE
DGM underwent a process of reorganization between 2013-2015, as the company looked to specialize its business operations. “We closed certain businesses for which we did not see a long-term future, instead concentrating on those where the future looked brightest,” explains Mr. Fields. “That’s all behind us now, and the result is a group whose business is more targeted, and whose operations are more efficient. We had our best year ever in 2020, and 2021
has started out better than that. Judging by our performance thus far, DGM is on track for a record-breaking year.”
The company has managed to avoid being significantly impacted by the ongoing COVID-19 pandemic. “At the height of the pandemic, our staff have all efficiently worked from home remotely,” says Mr. Fields. “Thanks to the foresight of the company’s leadership and Board to put in place the structure for us to work remotely and the fact that the business we serve allows us to do it remotely. Given the difficulty of travel, we had to adapt our marketing strategy, and we participated in a few live webinars as we looked to put our name out there and sustain our place in the marketplace. For our clients, instead of visiting them abroad, we communicated via Skype and Zoom, all the while preserving the quality of our service. We’re all back in office now, and we continue to acquire new business.”
COMMUNITY ROLE
DGM’s dependence on local talent has considerable benefits for the country’s population and economy. “By employing local talent, you’re doing two things,” explains Mr. Fields. “You’re taking already well-educated people, and you’re training them into a specific line of business. In return, they’re receiving better paid jobs. This is also true of the accounting and legal professions. This assists in the development of Barbadians with specialist skills”.
DGM employees aren’t the only ones to thrive on the company’s success. “For those services that we don’t offer in-house, such as investment management and legal services, we introduce our clients to other local service providers capable of performing those services,” explains Mr. Fields.
EFFECTIVE EXPANSION
In particular, DGM has high hopes for the future of its insurance business. “In recent years, we’re seeing a couple of trends within the insurance market: the increase in pricing of different types of insurance risks, and the inability to insure certain risks explains Mr. Fields. “We recently tried to place insurance in the London market, for Directors & Officers risk for a life insurance company under our management. Not a single company would insure that risk for us. We’re seeing the same pattern across different jurisdictions, such as Latin America. As a result of that, clients are setting up their own insurance companies to try and protect themselves by securing cover elsewhere.”
In order to capitalize on this opportunity, DGM is looking to expand its operations. “We’re not seeking to move into a new sector,” says Mr. Fields. “We’re very focused on what we do, and we don’t want to be diluted by initiating business that might not correlate with our expertise. We’re keen to expand, but only to do so where there’s a proper fit. That’s the approach that we’ve determined to be most effective.” c
