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Welcome to the Guernsey Finance podcast page.
Our podcasts bring you all the latest news and insight from Guernsey, the global finance specialist, as well as audio from some of our online events.
brandon 0:05
Hello and welcome to the We Are Guernsey podcast where we bring you interviews with leaders from the global finance industry, as well as news and developments from Guernsey's financial services sector. My name is Brandon Ashplant and I am Senior Strategy and Technical Executive here at Guernsey Finance. For those not familiar with Guernsey the island is a leading global finance centre. The success of the industry here is underpinned by economic substance political stability and asset security and we are committed to the to the cause of sustainable finance. To find out more about Guernsey's success in sustainable finance, tune in to our sister podcast, the Guernsey Green Finance Podcast. Today I am delighted to be joined by futurist award winning keynote speaker, author and CEO of Fast Future, Rohit Talwar. Rohit has worked with leaders and management teams in hundreds of corporations and government agencies in over 70 countries on six different continents. His clients include ABN AMRO, American Express, bank, ABC, Bahrain, Barclays, Citibank, Deutsche Bank and many other major brands in global finance. Rohit has a particular interest in harnessing cryptocurrency and artificial intelligence in a safe and productive manner, issues that he raised at the annual Guernsey Funds Forum in London last year. Today we will be discussing the future of financial services and the role of global finance centres such as Guernsey in this ever changing picture. So without further ado, welcome Rohit.
Rohit 1:35
Thank you for having me.
brandon 1:36
So, good to have you on. So, just firstly, Rohit, for those who don't know, you know, tell us a bit about yourself and your career to date.
Rohit 1:44
Thank you. Well, I started life in researching artificial intelligence, I've always had an interest in what's new, what's different and what's next. And that led me straight out of university to get into the field of artificial intelligence, and then move into broader management, consulting, and asking questions about why organisations were doing what they were doing. And discovering that sometimes they were just hoping that the future would be much like the present, or an evolution from present trends. And I discovered this field called future studies, which really allows you to explore a whole range of possibilities, and then use those to ensure we make better decisions today, and that we think and prepare for a different set of possible scenarios than the one we're currently basing our strategy on. And so from there, built this business, doing a combination of keynote speaking executive education, in depth research, consulting and publishing books about the future.
brandon 2:49
Okay, so, you know, you sort of touched on there, you know, future studies, and that's kind of where your, your sort of specialisms lie. You know, you describe yourself as a futurist, can you just kind of define what that means, you know, what is a futurist?
Rohit 3:01
So one of the things people always assume is that you're going to sit and make countless predictions about the future. The problem with that is your predictions are either going to be right or wrong. And what we think is much more important is identifying the forces, that trends, the developments, the ideas, and the weak signals of something new that we're seeing, and exploring how they might play out over time, how they might interact, and the different possible scenarios that could emerge. And then using those to help organisations if you like, rehearse the future, and to make sure that they're thinking about this broader range of possibilities, and are well prepared for a variety of things that could happen. And they have a plan B and A Plan C. And we're seeing that right now. Even two months ago, many organisations weren't expecting the kind of confluence of challenges that we're seeing right now. And so we're seeing more and more people understanding the value of future proofing their business. And that's where we fit.
brandon 4:09
And in your keynote speech at Guernsey's Funds Forum last year, you outlined the impact innovation can have in the immediate future and and how businesses should look to better equip themselves going forward. You know, a lot has happened since then even you know, in the last, you know, since the turn of the the new year in the last six months, the world is a completely different place, you know, war has returned to Europe and so forth. Would you say your views have changed as well?
Rohit 4:39
I don't think our views have changed as to what are the critical things we need to do to prepare for the future. What I do think has changed is people's understanding of how great that need is now to prepare for the future. And there's a much sharper focus on asking questions about out, how long will our current model survive? how secure are our revenue streams? Do we have the right capability? Are we doing enough innovation? And do we have a consistent process for doing foresight and looking at an over the horizon? So those were all the things I talked about. And what we're seeing is just an accelerated embrace of those things.
brandon 5:25
And that's really interesting. So you see, yeah, you're saying thing, the changing world sped up if anything, not necessarily altered your perception and certainly what's going on? You recently published an article for us, titled Evisaging Tomorrow's Guernsey- Harnessing Five Key Drivers Shaping The Future. Could you provide kind of a summary of this article, you know, what are the five key drivers?
Rohit 5:51
Sure. So firstly, let's set the context. Guernsey has built an incredible reputation in terms of being an offshore centre for financial services. But we know the financial services sector is going through a lot of change, automation is coming, changing the nature of jobs, reducing the number of jobs we need, in certain areas, creating new sectors, creating new possibilities, and the embedding of a lot of financial services in other activities. So I can top up my £2.75 coffee purchase to £3.00, and automatically have that put into a savings account. So we know that financial services is going quite rapid change transformation. And the challenge for Guernsey I think is to make sure it's looking ahead. So we picked on five things that we thought were critical. The first was to look up and out at what are those new sectors coming through, that are ones that we might want to bring into Guernsey or encouraging to Guernsey to help us spread the number of sectors that we are relying on for future growth. And that could be in technology, it could be in other fields, but really encouraging that view of when the next wave of growth might come from. The second was about making sure there is that talent available on the island or that you can attract it in and that includes using our facilities well to help people learn new skills in the evenings. Using those facilities for people who are experts to come in and teach either virtually, or physically to give people those new skills, and having programs to attract in the kind of talent we might want for the businesses we might want to bring in. The third piece was around broadband. All around the world, we see destinations competing to be in the top league, the top five or top 10 In terms of broadband speeds. And that's not just an ego thing that's about making sure that you have the infrastructure that will attract in the businesses of tomorrow, and sustain the businesses you have today. All of which are increasingly reliant on having superfast broadband, whether that's in the office, in the home or out in the street. So making sure that you have the right partnerships in place, and a mindset there to say, let's accelerate our deployment of broadband and make sure we're up there in the top league of that. The next was innovation. And that really is about how do we make sure we're creating an environment for new ideas to emerge, for people to develop those ideas, experiment with them and turn them into real and viable businesses, or real and viable change inside their own organisations. So there, we're talking about what can Guernsey do, to become more of a centre for innovation going forward, particularly in the sectors you want to attract. And that could involve things like setting up awards programs, and incubation programs, so that you can bring in those those sectors and encourage them to stay in Guernsey and build themselves there. And then the final piece was around foresight, it's I think it's never been more important to be looking ahead, looking out looking at what's changing in the world today, looking at what's coming over the horizon and really testing our thinking against those things and against the scenarios that could play out to make sure that we are future proof that we have robust strategies, and that we have a plan B and Plan C in place.
brandon 9:41
So the first thing you mentioned there, you know, is talking about emerging growth sectors and and perhaps where these these sort of lie you made mentioned in the article I think about, you know, examples of insurance in the in the crypto economy and so forth. What opportunities do you think exist here?
Rohit 10:00
So we'll take that as an example. What we see is a growing number of people buying crypto, whether it's individuals or businesses, every month, you see more and more businesses reporting in their annual accounts, that they put some crypto on their balance sheet, typically between one and 4%. Right now with crypto prices, the helm, what you're actually seeing is more and more people getting in because they think it's cheap. Now, we're not advocating buying crypto at all. What we're advocating is that you step aside from your emotions, and your instant reactions and understand it and understand why others are doing it. And that's also creating new opportunities. So for example, ensuring your crypto portfolio in the way that you might ensure other assets, and then deciding who wants to have custody of those crypto tokens. A lot of people don't want to own their own digital wallets to store them because of the risk of losing your passwords etc. And so there's a real opportunity emerging for the insurance sector to insure people's Christmas crypto assets, and also to provide the custody services so you can hold the crypto on behalf of your customers, this is a wholly new market opportunity. And the people who get in first are likely to do very well, because it's a need that's there and growing.
brandon 11:25
And I suppose the obvious kind of follow up to that will be, you know, how do you see global finance centres such as Guernsey and their respective kind of economies tying into this?
Rohit 11:38
Well, there's a few things here. One is obviously you've got to look at your regulation, and to decide how you want to handle these things. And we've seen a complete spectrum. On the one hand, we've seen countries basically not allow people to buy or hold crypto. And on the other, we're seeing countries saying they want to be a hub for it going forward. And the UK announced a few months ago that that's what it wants to do. It wants to encourage an innovators, it wants to create the right conditions, to start new ventures and develop them and what it's calling a sandbox to help them develop. And it wants to build a very deep dialogue between regulators, policymakers and the crypto sector to ensure that they can create viable, sustainable and legally sound businesses. So you've got that entire spectrum. And each location has to decide how it wants to play in that. The interesting thing about the things we're talking about of crypto insurance and crypto custody is that you can ban crypto completely, but still have players on the island providing those kinds of services. So the field is wide open. And it's one of those sectors that's very likely to grow, particularly as you see merchants like these MasterCard and others, making it easier and easier for businesses to accept crypto, and make it as easy to accept it as pounds, euros or dollars. And so it's really thinking about where our opportunities in that emerging world Kryptos one metre versus is another AI is another one of these sectors are the future that are going to be high growth. The trillion dollar sectors of the future are going to either be pure technology sectors or sectors that are enabled by advances in technology.
brandon 13:37
And the second point you talked around just just before it is this kind of effectively a war for talent. You know, on the back of COVID and the pandemic in the last couple of years we've seen an acceleration of what's kind of been dubbed as the great resignation so we're seeing people changing job jobs entirely and changing track on their careers completely. But then at the same time we've got people who are working remotely or in a more mobile fashion so they're working either from home or perhaps in completely different countries from from where they're perhaps are based. For living, I guess what do you think Guernsey's policymakers should be doing to try and retain local talents?
Rohit 14:22
I think there's a few different things there. One is if you've got superfast broadband, that it makes it very possible for people who want to live in Guernsey work from Guernsey, but work with organisations anywhere in the world that will allow them to do that legally. So one is again the broadband infrastructure that think is very important. The second is to make sure there's a vibrancy of activity on the island. So when people come they can have both social activities, but also business related networking type activities. So they can be in that community and feel like they're constantly learning and growing, and building their own personal networks. And the third, I think that's very important is to be creating interesting partnerships with organisations that allow you to develop a relationship. So you might partner with a big asset holder. And so we'll provide a dedicated service to help your people come and live and work from Guernsey. And we'll help manage that transition to make it a very smooth process. So there's a number of things that you can do to start to say, how do we tap into that growing desire for people to work from anywhere. One other thing that I think is very interesting that's going on is you're saying, this idea of nomadic working, and lots of companies setting up to support that where individuals literally move around and spend one to three months working from different places in the world, whether that's from Helsinki or Bali, and they move with a group of people, and we might get new people coming in and out of those pods of people moving around the world, who are supporting employers or clients all around the world, again, so you might want to look at plugging into that trend, and being on the tour if you like for those companies who are doing that. So you're bringing in fresh talent, you're getting people to see what's going on in the island. And then they might move on, but you've got a constant flow of those people who might never have thought of coming there. And so it's being creative, it's being imaginative, it's looking up and out, and what's changing? And how do you get involved in that? How do you attract people to come to Guernsey? And then what are the mechanisms you need to have in place to support them, whether they're from broadband infrastructure to entertainment and personal development?
brandon 17:09
Okay, and, you know, kind of following on from that point, I guess, you outline the need for the provision of a world class broadband infrastructure to accommodate an increasingly kind of digitized world and a world where, effectively, all of all the financial services conducted online in online format. Now, what sort of infrastructure kind of specifically do you think is required?
Rohit 17:34
Well, we touched on this a little bit earlier, without getting into the details of the protocols or the types of cabling. It is about partnering with the right suppliers who can roll out the infrastructure quickly, make sure that it's easily maintainable, that it's reliable, and can be upgraded. And recognising that this is now a complete a key competitive differentiator. So you'd be really surprised when you look at who has the fastest broadband in the world. They're, obviously countries like Korea and cities like Seoul that always want to be at the top. But then you've kind of got small islands, small countries, Iceland wants to be up there. You've got places like Lithuania, and Estonia, often competing for that, because they understand what a magnet is, and how important it is for bringing in talent and new ventures and then keeping them there. So I think it's less about the technical architecture of this where you want to find the partners who are going to guarantee that they're always going to keep you abreast of the latest technologies and keep you upgrading it. But it's more about having that vision of why you want it. And then having a relationship which ensures that you can get it fast and keep it upgraded. And be a testbed maybe for some of the services that people are talking about enabling via broadband and via superfast broadband, whether it's almost instantaneous download or content, secure provision of information, all of those kinds of things. So there you might have interesting opportunities to be a testbed with the broadband providers, and then maybe even get into some interesting commercial relationships where they pay you as being for being that testbed because they can then bring others in to show it working in practice, or they provide you with your broadband at a much lower cost in return for you being a place where they can show people the full service in operation. Again, it requires creativity and imagination and an entrepreneurial spirit to say how do we achieve this goal and work backwards almost from the goal to the present rather than looking at any constraints we might see. And I think for an island like Guernsey, a general mantra going forward might be one of those creative partnerships we can use to help us get world class in everything we want to do without having to pay for it. So that we can punch above our weight without necessarily having the investment funds to do that. And that's about creative and imaginative partnerships. And looking at others who've done that we look back at Singapore in the 60s, really wasn't something that people looked at as a place where you were going to become a center of innovation, a leader in many industries, having some of the world's biggest sovereign wealth funds. But it was that belief, that willingness to experiment, that willingness to use other people's money and creative ways to build innovation to build new sectors. And I think that's the kind of inspiration that Guernsey can be looking for. So you're not massively growing the population. But what you are doing is upskilling it and giving it the best possible infrastructure, the best possible services and the best possible experience of living day to day on the Island.
brandon 21:18
It's interesting. So in many ways, you're referring, not to put words in your mouth, but almost to a mentality and a way of thought, if anything, if anything else.
Rohit 21:27
Absolutely. And this isn't about saying you're good at this, I'm bad at that. It's about saying overall, how do we make sure that we have that mindset, not just a policymaker level, not just at the level of business leaders, but across the island? How do we make sure we're in getting people to engage with the future and understand it. And the point I make with everyone we work with is, it really doesn't matter whether you like this or not, it doesn't matter how you feel about this, what matters most is that you understand it. And then you make the informed decisions on the basis of the understanding, you can still bring your emotions back in and say, Well, I understand this, I see it's an opportunity. But emotionally, we don't want this, but that's fine, you're making a decision based on insight. But we see too many people making decisions based on gut reactions, or a lack of understanding, and those rarely serve as well. So the importance here is about in a sense, getting everyone looking up and out and thinking about our world and how it's changing and where certain activities and industries and activities within industries might be on the decline, while others are emerging, and exciting new sectors are coming along, that could give us that next wave of growth of job creation, and or taxation revenues that help us fund the operation of the island.
brandon 22:59
Brilliant, sort of trained. So switching gears now and sort of taking a bit of a step back, you know, as a futurist, who no doubt often discuss innovation as a as a kind of issue, if you like. And this was something you outlined, as I said earlier, so that our Funds Forum last year, and the term has become a bit of a buzzword in many respects for us. So maybe let's just take a step back, as I say, and ask, you know, what do you mean when you say innovation?
Rohit 23:27
So innovation isn't just about having ideas. It's about having a framework and support in place to go from having an idea to translating that into an experiment to see if the idea can be brought to life. It's about connecting that with the people who might use it, whether it's inside an organisation, or customers in the marketplace, and proving that it delivers something better, or something new, for which people are willing to pay, or which can enhance the way they do business inside the organisation, and leave people feeling that they've got something more valuable or something new and more valuable than they have before. So innovation is that process of turning ideas into new value inside the organization or in the marketplace.
brandon 24:24
And what sorts of innovation do you think Guernsey should be exploring further as it sort of cast its eyes to the future? Because, you've talked a bit about around the the hard factors, if you like and the infrastructure and that sort of side of things. Are there any sort of soft skills that will soft play that you think Guernsey could be sort of teasing out early on in this in this sort of process of looking to the future?
Rohit 24:49
I think there's a few things there. One is encouraging the businesses on the island to if you'd like create those innovation competitions, and innovation challenges. So you might pick two or three issues at any one time for the island and want to give people some tools and skills to innovate, and then encourage them to put forward their ideas and their their potential solutions for how we tackle those and have the business community fund that. So you're suffering building innovation capability in the island. The next is to look at all of the different levels of education that happened in the island, and making sure that there is some training available, whether it's from primary school upwards, into how to have ideas, how to turn ideas, into experiments, and turn those into something real, how to solve problems in creative ways, how to look up and out to look for new ideas from elsewhere, and maybe bring them into our lives or into our organisations. And really creating a culture where people are encouraged to learn to innovate and to look outside for ideas and inspiration. I think that's, that's one of those foundational things. And you see some great examples of that, again, Singapore I referred to earlier, everyone in the country gets an allowance, I think it's about 500, Singapore dollars, to fund any kind of training course that they want to take. And it's that kind of thing where you're really encouraging people to stay open in their thinking, to be curious to learn new things. And then to use that learning to drive new ideas, which can then be turned into real change. And I think it's that kind of mindset conversation. It's that kind of philosophy that says the way we drive ourselves forward, is to be constantly curious, constantly creative, and then have the capacity to turn those ideas into real innovations that add value. And I think that's that dialogue that starts to become part of the fabric of how we talk about what Guernsey is and how Guernsey is preparing for the future.
brandon 27:17
You know, I think it's always an interesting dichotomy there. Because Guernsey and its finance industry has in many respects, or certainly we consider an island to be fairly forward looking and innovative. You know, Guernsey was the first jurisdiction globally to develop a cell structure, sort of company structure, the PCC and the ICC, the ICC before that, and the island actually, of course, developed the world's first green fund regime, the Guernsey Green Fund, and the regulator on island, the Guernsey Financial Services Commission is currently in consultation to develop a natural capital fund, which unlike the Green Fund regime, looks at biodiversity rather than sort of the carbon capturing or carbon mitigation technology funding. So this is all in the finance industry. But again, you know, and it talks to your point before how policymakers create a landscape in which innovation can flourish across the economy. And Guernsey you know what, I guess it's the age old question, you know, is it? Is it? Is government the first mover here? Or was it the private sector? Or who should be kind of stepping in here?
Rohit 28:22
Well, I guess, trying to take a slightly different perspective on it, then, then then we've already covered, we can encourage innovation within the existing sectors that are there, and obviously financial services as one. And that's a collaboration between the sector and the regulator, and looking ahead to say, Okay, well, what's the next area that we could focus on? So you talked about different types of funds? One of the things that I think is going to be even more important going forward, if we're going to be relying on carbon capture, is how do we measure the absorption of the assets that we're using natural assets that we say, are giving us our offsets, because we know, for example, that in the Amazon, the trees that people are effectively buying, and then emitting more carbon than they're absorbing. So they're not serving the purpose they were intended to. So you're seeing some interesting ventures emerge now, where they're putting sensors on trees, to monitor exactly what the emissions or absorption are of each tree, and then being able to capture that on what's called a blockchain. So you can monitor exactly what's happening. Now you think about those kinds of technologies. And there's a massive investment opportunity there. Not just for giant forests, but if you and I have a tree in our garden, then suddenly that can be part of that process. So there's a whole wave of innovation there and new technology solutions, and all sorts of possibilities that emerge. Imagine, again, it's about looking out and saying, Okay, where are those opportunities? Where are the greatest needs that could last a few years? And it's worth us creating an conducive regulatory environment to build funds in those? And then there's a piece that says, Okay, do we want to be totally reliant on one or two sectors? Or do we want to spread it a little bit, and start attracting in some of those non financial services sectors that could grow over time and have us balance our economy out over those different sectors, because the other thing is, with every sector becoming increasingly technology dependent, some of the underlying technology skills are going to be transferable. So it's not like you have to bring in an entirely new skill set, when you bring in new industries, because you've got some of those people there. And I think that's, that's something that Guernsey could be thinking about is alongside encouraging innovation and existing sectors, what are we doing to innovate and create a conducive environment for new sectors here, and whether that's for the sector itself, or funds and solutions for those sectors, that that's for policymakers to dislike, again, if you say it's all about funds, then you have a particular focus and a reliance on that. If you're trying to take different activities from other sectors and bring them in, then it's if you like, spreading your opportunity, spreading your risk across slightly more sectors, and maybe creating a different kind of business environment on the island.
brandon 31:38
Okay, and just perhaps a final question, then to to finish this off, on the back of that, you know, and it very much ties into the to this idea that there's there's five kind of key drivers for Guernsey and obviously, the first one was emerging growth sectors, should the finance industry and financial services or on Guernsey and that kind of ecosystem be supportive of a diversified economy?
Rohit 32:01
I can't tell them what to do. And nor would I even attempt to, what I can say is that economies that have a diversified, or countries and islands and nations that have a diversified economy, are better equipped to weather any storm have a vibrancy about them, and can have far higher levels of innovation because there's a cross fertilization of ideas, and new opportunities emerge when one sector talks to another. So I don't think there's any risk to financial services of Guernsey looking out and bringing in other sectors, particularly as financial services, businesses automate more of what they do, and therefore potentially need less people in their core activities. Then there's a kind of enlightened self interest there to say, well, maybe we should be encouraging more industries in but again, I can't tell them what to do. I can just see why you might see benefits in that. Obviously, the downside financial services is the policy makers on the island won't just be thinking about them so much. And we'll be thinking about how you create cross sectoral growth. So so there are some downsides for financial services. But I would say the upsides probably more than outweigh those downsides.
brandon 33:32
Okay, well, brilliant. Unfortunately, it's all we have time for. But thank you very much Rohit for your time today. Were closer. I was particularly intrigued by how you think Guernsey is well placed to play an important role in this emerging future. So thank you very much for that. And thanks also to you for listening. If you enjoyed this discussion, we have a backlog of interviews and panel discussions on the we are Guernsey podcast channel, you can check them out by searching for WE ARE GUERNSEY on your preferred podcast platform. To find out more about Guernsey and its specialist financial services sector head over to our website at www.weareguernsey.com We also have links to Rohit and fast futures social media in our show notes, so check these out to hear more from them. Thanks for listening. And for now. It's goodbye from Guernsey
Transcribed by https://otter.ai