Assoc Prof John Sequeira, Academic Director, Asian Financial Leaders Programme (AFLP)
Zhang Hong, Director, Sim Kee Boon Institute for Financial Economics
Doris Sohmen-Pao, CEO, Human Capital Leadership Institute
Graduates and Alumni of SMU, HCLI and AFLP
Ladies & Gentleman
Introduction
1. Congrats to graduates of Run 9 of the AFLP. AFLP started in 2015, the year I left the financial sector.
2. My speech today will answer 3 questions:
(a) Why financial leaders are important
(b) What financial leaders can do
(c) How we can grow financial leaders
(A) Why are financial leaders important
3. Financial leaders are more important now than ever before because the world is becoming more uncertain.
4. Geopolitics, climate change and technology dominate our headlines.
5. These make our world more uncertain and require us to think and act more nimbly, more strategically and more decisively.
6. Let me start with geopolitics:
- We are grappling with geopolitical tensions of a different nature and rising protectionism.
- Countries are pursuing de-risking strategies. They are “near-shoring” or “friend-shoring” their supply chains.
- Measures like sanctions, export and import controls, and investment restrictions have become more common.
- This increases the challenges for a small, open economy like ours that thrives on open and free trade and globalisation.
- Geopolitical tensions risk taking our focus away from climate challenges, which brings me to my second point.
7. The climate challenge is real. Extreme weather and rising temperatures are becoming all too common.
- While Singapore was dealing with the Sumatran Squall, I was in Brazil’s Amazonian rainforest, and I saw first hand the impact of climate change. There is a prolonged drought and dry season affecting the Amazon, hurting crops, affecting biodiversity and human, animal and plant life.
- To deal with these challenges, we must remain committed to our transition to net zero.
- But this means we’ll need to fundamentally restructure global supply chains, industries and come up with financial solutions to finance this transition.
- At the same time, our appetite for technological progress presents both challenge and opportunity.
8. Which brings me to my third point on technology. As our appetite for technological progress increases, we will need more energy to power new and more powerful computers, including quantum computers and GPUs to drive the AI revolution.
- This can fundamentally reshape our economies, jobs, and our way of living.
9. Against this global backdrop, good financial leaders can help us make sense of the world, deploy capital for impact and manage risks. That is why financial leaders are important.
10. Financial leaders who understand Asia are even more important. Why?
11. In a more uncertain world, Asia’s economic potential has come into focus.
(a) Asia is now the world’s second-most integrated trade region, after the European Union.
i. In 2022, nearly 57% of the value of Asia’s trade originated within our region, up from 54% in 2000. This means intra-Asia trade is increasing. Contrast this to most other regions, which have witnessed decreases in intraregional share of trade.
ii. By 2031, ASEAN exports are expected to surge by nearly 90% versus overall global trade growth of less than 30%.
(b) Wealth in Asia is expected to continue growing.
i. Asia Pacific is anticipating a USD$5.8 trillion transfer of wealth by 2030.
(c) We need financial leaders to channel this growing wealth into impactful investments.
i. In particular, Asia’s private credit grew from US$24bn in 2013 to US$114bn
ii. In India, the total private debt AUM was US$13.4bn as at June 2022, an increase of more than 50% from US$8.9bn as at end 2020.
iii. In China, this same figure was US$51bn, increase of 31% from US$38.9bn as at end 2020.
12. This is why financial leaders are important. Because you can play a role to channel growth and capital into investments that can potentially make a financial and environmental and social impact.
(B) What can financial leaders do?
13. Which brings me to my second point. We know financial leaders are important. So what can they do in today’s environment?
14. Let me propose two roles financial leaders can play, drawing parallels from Singapore’s key value propositions as an international financial centre:
15. First, you can help bridge the world and Asia. Bridging the Global-Asia markets.
16. As an international financial centre, Singapore connects global investors to Asia, and bring Asian opportunities to global investors.
(a) Asia is a highly dynamic region that is expected to grow 4.5% in 2024, contributing to two-thirds of global growth for the year.
(b) Global investors want to be a part of our Asian growth story.
i. Many asset managers and asset owners base their regional operations in Singapore as a gateway to tap into the myriad of investment opportunities in Asia, that at the same time supports Asia’s development.
ii. Private Equity (PE) and Venture Capital (VC) AUM is growing twice as quickly as overall AUM. Singapore is now a thriving launch pad for Asian enterprises looking to raise capital.
iii. Over half the growth of Singapore’s PE and VC AUM between 2018 and 2023 was directed towards supporting the growth of businesses in APAC.
iv. Large global private credit managers are expanding their Asia teams in Singapore, and new private credit managers are establishing a presence here to tap investment opportunities in our region.
17. Financial leaders can serve as a bridge to connect global markets to Asia and bring Asian perspectives to the global stage.
(a) Many of you work for financial institutions which are headquartered outside of Asia.
(b) You can help play a bridging role, to facilitate better understanding of the dynamics of working with Asian clients or how to navigate Asian markets.
(c) These will bring about more-informed decision-making and improve collaboration across teams.
18. To do this well, leaders need in-depth understanding of Asia’s complex and diverse operating environment.
(a) The best way to learn is to get into the thick of the action, build local networks and meet clients in your own markets.
19. Second, you can find new ways to partner and collaborate
20. You can unlock challenges and identify growth opportunities through partnerships and collaboration. Let me provide two examples in the payments space and the sustainable finance space.
21. In the payments space, we are making payments instant and financial transactions seamless, within financial institutions in Singapore and beyond.
(a) MAS has established bilateral real-time cross-border payment linkages with key regional partners including Thailand, India, Malaysia and Indonesia. We are also planning to build multilateral instant payment system linkages within ASEAN.
(b) MAS is also building infrastructure for asset tokenisation on a commercial scale with our international partners in the public and private sectors.
i. Specifically, MAS is working with a group of financial institutions to develop a foundational digital infrastructure under the Global Layer 1 (GL1) initiative. Our aim is to enable tokenised assets to be transacted across networks and countries efficiently and seamlessly.
ii. MAS is also working with international policymakers to develop industry standards and frameworks for tokenised assets and digital asset networks.
22. In sustainable finance, the financial sector and industry is working together on a few practical projects.
(a) We set up the Singapore Sustainable Finance Association (SSFA), which brings together representatives from financial institutions, industry associations, corporates and service providers such as ESG rating agencies.
(b) An initiative supported by SSFA is the Financing Asia’s Transition Partnership (FAST-P), where public and private players are coming together to catalyse and scale up financing through blended finance, to de-risk projects and improve viability for commercial capital.
(c) We also launched the Sustainable Finance Jobs Transformation Map earlier this year, to equip our workforce with skills for sustainable finance, so our financial centre can better support our region’s net zero transition. The Institute of Banking and Finance (IBF) has accredited over 130 training programmes and training participation has increased by 70%. IBF also implemented the new IBF skills Badge to recognise individuals’ mastery of sustainable finance skills. IBF continues to work with more financial institutions to upskill their workforce including by accrediting inhouse training programmes.
(C) How we can grow financial leaders
23. We’ve discussed (1) why financial leaders are important, and (2) suggested what financial leaders can do. Which now begs the final and most important question: (3) Where do we find these financial leaders? How can we grow them?
24. The answer of course, is through programmes like the AFLP.
25. AFLP was started in 2015, to equip senior finance professionals aspiring to C-suite roles with knowledge and capabilities to operate effectively across diverse business, regulatory, and legal environments.
26. Over the years AFLP graduates tell us that they value the opportunity this programme gives them, to learn from and interact with top policymakers from the region and build networks with fellow financial sector leaders.
27. I’m a little envious. I left the financial sector in 2015, before AFLP was launched. And I see a former colleague of mine in your batch now as CEO and a top financial leader and I can only wonder what might have been had I stayed in finance.
28. But now that I am on the other side, I get to work with my new colleagues at MAS to enhance our programmes. And I am pleased to make two announcements about how we are doing so.
29. The first announcement is that MAS will launch two new leadership programmes in 2025:
i. One targeted at MD and above seniority level who have potential to progress to more senior leadership roles; and
ii. Another targeted at high potential middle-level professionals at the SVP and Directors levels. This will serve a much bigger group, which is more than two times of the pool at the senior level.
Funding for these programmes will be offered under MAS’ Asian Financial Leaders Scheme (AFLS), to defray 50% of the programme costs for Singaporeans.
30. The second announcement is that MAS will introduce a new Group Track under our International Postings Programme, (iPOST). This will further support and encourage financial institutions to send Singaporean leaders for overseas postings.
i. We will work with financial institutions to commit upfront to send a larger number of Singaporeans on overseas postings within 1 to 2 years.
ii. In exchange for the commitment to send more overseas, we will extend more flexibility in terms of the posting duration and extend funding to 3 years, up from the current 2 years.
iii. More details will be released on MAS’ website.
This enhancement to iPOST is important. To give context, since 2016, more than 200 Singaporeans have been supported through iPOST.
In a recent survey MAS conducted among financial institutions that were supported through iPOST, financial institutions reported that close to 60% of those whom they sent on overseas postings saw at least one jump in their seniority level after returning. This suggests that overseas exposure is a contributing factor towards career progression.
I’m a big believer in overseas postings, having worked in the US and Hong Kong. So I hope this will benefit many Singaporean financial leaders.
31. Finally, in addition to training and overseas postings, networks are another important ingredient in growing financial leaders.
32. Which is why I would like to pitch for the different networks that you can all join.
33. First, MAS manages the Singapore Financial Leaders Network (or SFLN) to facilitate networking and collaboration among Singaporean leaders.
(a) Please join SFLN. SFLN organises events throughout the year for members to network with one another and gain exposure to global thought leaders and financial institution leaders.
(b) SFLN members have also put together groups to learn more about specific topics of interest or to work together to address common issues or challenges.
34. Second, please also join EDB’s Singapore Leaders Network (or SGLN), which is run by HCLI. Get in touch with my old friend Nadir Zaffar. SGLN enables financial sector leaders to network with peers from outside the financial sector.
35. Conclusion
36. Ladies and Gentlemen, we’ve explored:
(a) Why financial leaders are important
(b) What can financial leaders do
(c) How to grow financial leaders
37. Financial leaders are critical to Singapore’s position as a trusted and dynamic global financial centre. We must always be open and connected, welcoming to the best talent from around the world to be part of our team, working together with financial leaders that we are growing here at home.
38. I know this to be true. That working together with the world’s best sharpens our thinking and sharpens our craft as financial leaders.
39. Like Chan San San and Andrew Chia, who are among the 6,500 Singaporeans holding senior roles in the financial sector.
40. San San and Andrew are both AFLP alumni and supported by the AFLS. They are examples of Singaporeans who honed their ability to lead global teams, gained overseas experience, and recently assumed top leadership roles in banking and insurance.
41. We hope to see more financial leaders like them, as we raise up the next generation of financial sector leaders.
42. It now leaves me to recognise this new batch of financial leaders who have graduated from the AFLP this evening.
43. Thank you all for your attention.
44. Congratulations once again to our graduands.
***
[1] McKinsey. “Asia” The epicenter of global trade shifts”. Sep 2024.
[2] BCG. “How ASEAN can use its trade advantage to power ahead”. May 2023.
[3] McKinsey. “Asia-Pacific’s family office boom: Opportunity knocks”. Sep 2024.
[4] Preqin Pro
