Diversity in the Thai financial sector
Singapore has long been centre-stage as Asia's financial hub.
This has been the case in asset and wealth management (AWM), with the city-state providing an effective platform for boutique firms and bank-owned AWM offerings throughout the region. There is little doubt that this will remain the case in the medium term, despite the sustained growth (considering recent troubles) of Hong Kong and the emergence of Shanghai as a regional hub.
The status quo in Singapore centres around banking and portfolio management teams dedicated to either Asia, south Asia or specific countries being split between Hong Kong and Singapore. These teams tend to cover growing non-core markets including Malaysia, Thailand, Indonesia and the Philippines.
Through various engagements, the team at Wilbury Stratton has spoken to senior-level sources who believe that Thailand is primed for exponential growth and offers a wealth of opportunity, not just from a business angle, but from a cultural and talent perspective. Thailand will be a catalyst for growth right across Asia Pacific.
Thailand is not yet a full Common Reporting Standard (CRS) participant, which is an opportunity that Swiss banks like Julius Baer can capitalise on as they entered a JV with SCB in early 2019. It is likely to be 2021, or perhaps even 2022, before automatic information exchanges start.
Local banks with an AWM branch network are viewed as front-runners due to their proximity to customers and the cultural nuances of Thailand. Reducing the number of branches and expanding alternative distribution channels is growing as it is elsewhere, but Thailand has some ground to make up in that sense.
International firms, therefore, continue to seek out local partners, who understand the culture, nuances and regulatory framework (or lack of) as vehicles to achieve their strategic goals. "Direct to digital" as opposed to having to acquire customers through digital channels from more traditional platforms, is seen as an advantage and will expedite the growth trajectory of AWM players compared with established Western norms.
One of the most promising benefits of Thailand, either overlooked or simply unknown to observers, is the sheer scale of gender diversity and equality. Out of the 110,000 financial professionals in Thailand, 67% are female according to Wilbury Stratton’s MyTalentPipeline database.
There is no wandering decimal point. That's 73,700 female professionals in Thailand's financial sector split across all disciplines, which is quite astonishing.
There are widely acknowledged talent shortages in AWM globally. This is particularly the case in Asia where markets are less mature, and the talent pools are therefore more limited.
The nature of investments from both institutional and individual investors are growing more complex, which amongst other critical factors creates challenges in finding the right talent. Not having to resort to costly hires, inflated salaries and other demands of those few who are both easily identifiable and known to be active in the market, adds to this complexity.
Through our research, we have been able to monitor, analyse and advise relevant parties on local and international banks, securities companies and asset management firms’ activities in Thailand. Being able to capture opportunities arising from the rapid pace of wealth creation in the region and resulting to larger asset bases ranks high on the list of our sources priorities. Access to talent in the market has proved to be troublesome for international and regional firms looking to enter it.
Most senior management in the sector are Thai nationals and, until now, they have been somewhat siloed within the region. Out of 420 prominent AWM leaders, we found 50 to be non-Thai, half were European and several are native of Singapore, Malaysia, and Korea.
This group of 50 is the key to success for firms looking to make their mark in the Thai AWM sector. With staff retention at relatively high levels in the country (average tenure 7 years) those who move first will go furthest.
In AWM specifically, a recent client engagement saw our research team identify 40% female talent when assessing a 1500-strong dataset of individuals equipped to establish a desk or branch office in Thailand.
Furthermore, 21% of boards have more than 30% female representation and 13% of executive directors are female. It is evident that there is still some way to go – however with an ageing workforce, this gender-diverse talent is well-positioned to take on Industry 4.0-driven responsibilities and the bench strength is impressive.
Consequently, organisations ought to be considering Thailand and factoring in the increasing integration of ASEAN markets for the benefit of their local, regional and global leadership hiring, centres of excellence, and talent pipelines.
By Ben Race, Client Partner, Wilbury Stratton