View Profile’s latest recruitment insights and reports on the talent landscape across our key markets - Hong Kong, Singapore, Shanghai and Beijing.


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Profile News: HR Insight Q3 2017

In the Macmillan Davies magazine, ‘HR Insight Q3 2017’, Profile's Amanda Clarke shared her thoughts on HR recruitment trends in Asia. The article is extracted below. GLOBAL MARKET TRENDS UK “As we enter the final quarter of 2017 we are still seeing an increase in overall time-to-hire, in part due to the summer holidays causing a lag in the hiring process, with key decision makers away. This has occasionally resulted in clients missing out on preferred candidates who have received multiple offers and accepted positions elsewhere. Brexit continues to cause disruption to our client’s hiring plans. The number of new vacancies overall remains steady from last quarter and we are seeing higher levels of recruitment activity for specialist roles across all sectors. As organisations continue to go through group wide change there has been a resurgence in specialist change & communications positions. Similarly, we have seen an increase of in-house recruitment roles across all sectors, mostly paying under £50,000. With the changing political landscape, businesses are continuing to remain cautious and we are seeing the continuation of the ‘try before you buy’ approach to hiring, with many clients opting to hire on an interim basis initially, or extending current contracts before turning perm. As businesses look to cut costs and create a leaner HR function, demand for professionals with diverse experience is on the rise. This is particularly evident in the public and third sector with growing demand for HR generalists who are skilled in delivering on specialist projects such as change and reward. Towards the senior end of the market, there’s been a slowdown in hiring, particularly within Financial Services which remains very client driven as suitable candidates outnumber advertised roles. Improvement & implementation of HR technology such as workday & the increase of succession planning has meant that a lot of senior roles are being filled internally, with clients instead hiring externally for junior to mid level positions.” Darren Hayman & Angela Franks - Macmillan Davies ASIA “Despite a promising start to the year, hiring in Asia has been relatively slow in both Hong Kong and Singapore. That said, the China market has been buoyant for the last two quarters and shows no sign of slowing down. Roles in financial services have been sporadic although the insurance sector has continued to hire across a range of roles and levels. The retail market has continued to be cautious but we have seen a marked increase for roles within pharmaceuticals and healthcare (particularly in China). Talent Management and other specialist roles such as Rewards and HR Operations have been in demand and we predict further interest in technical areas such as HR Analytics. Interestingly we have seen an overall rise in vacancies in the last month, and with a shortage of strong talent at the more senior end of the market, it will be interesting to see who is prepared to buy potential bonuses out and compete for some of the top talent as we go into the last quarter of the year.” Amanda Clarke - Profile Search & Selection AUSTRALIA “As we come towards the end of Q1 of the Australian Financial Year, the HR recruitment market has remained robust with growth occurring in all major states. Even the Resource rich states of Queensland and Western Australia, which experienced a prolonged downturn for a number of years, have shown encouraging growth in the last 12 months. Opportunities have surged by 33% in QLD, and 24% in WA over the last 12 months. As previously reported, both of these growth figures are from a low comparison base, but in QLD there are now talent shortages in the junior to mid-career market. The larger economies of NSW and Victoria have both also continued to grow well in the last year, with 13% and 12% growth respectively, which combined with the other states bring the overall national growth in advertised roles to 16%. The interesting feature of this growth has been the bias towards contract opportunities versus permanent roles. Whilst growth in permanent opportunities has been consistent, contract role growth is accelerating as organisations manage their headcount needs and supplement that with specialist or temporary support. The industry sectors that continue to see outstanding growth in opportunities for HR professionals are healthcare (+49% YoY) and professional services (+29%). Professional Services in the Australian market, also includes the engineering and infrastructure consulting firms, which have seen major growth with the boom in infrastructure spending in NSW and Victoria, a phenomenon that will soon occur also in QLD with ambitious infrastructure projects about to commence and run for the next 5 years. Within the individual occupation groups, both generalists and specialists have been in demand. The senior market in NSW, Victoria, and to a lesser extent QLD, have been active, and there has been strong demand across the mid and junior markets. The changes made by the government to the Class 457 long term business visa, has made it harder for businesses to bring in international talent below the most senior levels, an issue that is hitting the Recruitment specialism the hardest, as the UK and other countries was a significant source of talent.” John Baker - The Next Step To read the full magazine, please click here.
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Profile Event: ‘Family Heritage and Private Equity'

PROFILE CONFERENCE WITH CHAOYANG DISTRICT ENTERPRISE COMMITTEE OF CDNCA AND CREDITEASE: 'FAMILY HERITAGE AND PRIVATE EQUITY' On August 20th 2017, Profile held a conference on ‘Family Heritage and Private Equity’ at Hejingfu Hotel in Beijing. The event was jointly sponsored by Chaoyang District Enterprise Committee of China Democratic National Construction Association (CDNCA) and CreditEase.​ Many delegates were invited to the event, including Ren Xueliang, the Deputy Executive Director of the Beijing Municipal Committee of CDNCA; Chen Mingjian, the Director of the Chaoyang District Enterprise Committee of CDNCA; Hou Huirong, the Deputy Director and member of the Central Liaison Committee of CDNCA; Tang Ning, the founder and CEO of CreditEase; and Hu Lemin, an assistant to the Director of Department of Financial Products and Head of Family Trust Products at CreditEase. Winni Wei, the Deputy Secretary General of the Chaoyang District Enterprise Committee of CDNCA and Director of Profile Search & Selection, chaired the conference. Guest speakers at the conference raised several issues that CDNCA entrepreneurs were concerned about, including the global trend of asset allocation and the current situation of private equity, funds of funds at home & abroad, and family heritage. ​Ren Xueliang expressed that a sound environment is necessary for financial innovations. “By leveraging the model of funds of funds, you can put the capital into various top-level venture funds and garner long-term double-digit returns — this is our investment advice for Chinese high-net-worth individuals in the primary market of private equity.” Tang Ning also shared his advice for high-net-worth individuals in China, while Hu Lemin introduced the family trust in detail. Ren also interpreted risk control policies for the financial technology industry, which were introduced by the central government after the National Financial Work Conference. Tang discussed the risk control mechanisms of CreditEase in relation to asset allocation, as well as how CreditEase could provide good advice for governments based on its experience over the last ten years. Referring to financial innovation, Tang also stated that CreditEase is changing society with technical innovations and creative models, stating that “Our ambition must not be confined to online lending or wealth management.” The CDNCA entrepreneurs were all greatly inspired by the speakers’ observations. ​​ Profile 'Family Heritage and Private Equity' Conference with Chaoyang District Enterprise Committee of CDNCA and CreditEase, Beijing.
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Profile Sales & Marketing Market Update, China, Aug 2017

The following report provides an update on the key trends that we have observed within the Sales & Marketing job market in China. It identifies emerging themes across various industries and details the major factors impacting hiring and talent movement. ECONOMIC LANDSCAPE China's economic growth is expected to reach 6.6% for 2017, tempering initial worries of a slowdown as Beijing walks a political tightrope with its quest to crackdown on financial risks and limit damage to the economy. The Chinese government initially targeted an economic growth rate of around 6.5% for this year, which is slightly down from the 6.7% growth rate in 2016 - the slowest in 26 years - as authorities stepped up their campaign to wean the economy off its reliance on cheap credit. China’s economic growth remained healthy in the second quarter of 2017, with consumption and retail sales both increasing compared to the same period last year. In particular, the eCommerce sector continued its rapid growth in the first half of this year. The country’s cross-border eCommerce transactions pulled in a staggering 6.5 trillion yuan, the largest growth rate globally. Early predictions by the government suggest that the Chinese economy will grow by 6.3% in 2018 however. MARKET TRENDS In line with the boom in the eCommerce (O2O market) sector in mainland China, there has been an increasing demand for sales & marketing professionals with specific skill sets. Professionals with experience in digital marketing, social media, CRM and developing businesses via online channels have been in great demand. The FMCG industry has been placing more emphasis on eCommerce strategies, acknowledging it as a powerful sales channel. From a recruitment perspective, there has been growing demand for FMCG companies searching for professionals from large established eCommerce companies. Many large multinational corporations have been restructuring and reorganising their commercial functions so that they are better equipped at handling the forever-evolving trends within eCommerce. In particular, a number of traditional retailers and consumer brands have been seeking individuals with diversified profiles, who have the skill set and experience in establishing new businesses and who have been exposed to eCommerce marketing strategy and delivery. As digital businesses become increasingly linked to eCommerce platforms, driving traffic to their online stores has been the biggest topic among digital, eCommerce and branding professionals. The majority of businesses have been focusing their attention and efforts on consumer behavior, leveraging elements of design and consumer understanding in order to better its products and services for its customers. As a result, new market research methodologies and consumer-centric research tools have been at the forefront for many companies. This has created a growing need for sales & marketing talent who are adept at strategic planning and feasibility research and analysis. Companies have also been investing heavily in short and long-term marketing strategies, including new headcount, believing that the right person and strategy can lead the change, and change the rules of the game, amidst strong global competition. Sales in the luxury retail sector have been steady compared to a couple of years ago. Whilst this may be the case, luxury brands are still being vigilant in their recruitment and expansion plans. Fast fashion brands and sports retailers, however, appear to be growing their teams and expanding operations in China. SALARIES & BONUSES Salary increments in the B2C sector have been minimal this year, averaging 5%, as FMCGs focus on turning their businesses around and increasing sales. Professionals with solid digital and eCommerce experience, along with brand building skills, received higher increments this year, ranging from 15 to 25%. THE FUTURE Marketers are now expected to work much more closely with various teams within an organisation, from finance, strategy planning to IT and human resources. Understanding market research tools, CRM and being able to provide strategic input and generate new business will be some of the critical skills expected far more by marketers in the future. Candidates who are fluent in both English and Mandarin, tech-savvy and have experience working for local Chinese companies (both traditional and new business models) will continue to be highly regarded by clients. Hiring activity by companies in the premium brands, lifestyle, health, pan-entertainment and education sectors is expected to rise in the coming years, which will provide job seekers with more opportunities. As businesses seek new and innovative ways to expand their market share and diversify their business categories, their need for talent with M&A experience will continue to be strong.
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Profile Accounting & Finance Market Update, Hong Kong, Jul 2017

The following report provides an update on the key trends that we have observed within the Accounting & Finance job market in Hong Kong. It identifies emerging themes across various industries and details the major factors impacting hiring and talent movement.​ ECONOMIC LANDSCAPE 2016 was a year marked by black swan events. Internationally, both Brexit and Donald Trump’s victory in the U.S. presidential election have had a profound effect on the international economic system. Furthermore, the interest rate hikes by the U.S. Federal Reserve and the reduction of oil production will continue to impact financial markets. In Asia, Ms. Tsai Ing-wen was elected the President of Taiwan and Mr. Rodrigo Duterte took office in the Philippines, both of which added uncertainty to the Asian economic and political landscapes. Despite the unstable global economic outlook, Hong Kong’s economy expanded by 4.3% in real terms in the first quarter of 2017, after growing by 2% in 2016. In nominal terms, the value of retail sales has dropped by 1.3% year-on-year in the January to March 2017 period, however the economy as a whole is forecast to grow by 2 to 3% this year. The labour market in Hong Kong is stable but is not without its challenges. The seasonally adjusted unemployment rate in Hong Kong stood at 3.2% in the first quarter of this year, unchanged from the previous quarter. MARKET TRENDS The strengthening dollar is posing challenges to businesses that manage multiple currencies, particularly in the South East Asia region. As a result, senior accounting & finance executives are now expected to have strong capital management and risk management expertise as well as experience in managing a regional treasury function. In addition to business process outsourcing, shared services centers and ERP system implementations, companies today are looking at opportunities to boost efficiency and cut costs through the use of Robotic Process Automation. Businesses are continuing to streamline their regional accounting & finance teams due to the digital disruption in the financial sector coupled with high operating costs in Hong Kong. As such, it is now becoming the norm for the accounting & finance function to step up and act as a business partnering function too. In a highly competitive recruitment market, candidates who can provide companies with financial insights that support their business growth will be ahead of the game. Specialists in the corporate function will continue to be in high demand during the second half of 2017, especially within tax, treasury, M&A and audit. SALARIES & BONUSES Most companies paid their bonuses in the first quarter of this year, which were generally down in most organisations. This has caused frustrations among strong performers and, as a result, they have been the first ones to seek new roles in the first half of this year. Salary increases in 2017 have been fairly minimal across all sectors. Most companies provided staff with a small increment in line with inflation, with some issuing a salary freeze conditional on economic growth. The average salary increment observed in the market at the senior level, for those that did receive an increase, was in the vicinity of 4 to 6%. Due to a highly competitive recruitment market, accounting & finance candidates have been open to new opportunities without salary increases. THE FUTURE Although hiring activity in key sectors such as retail and financial services stalled in the first and second quarters of 2017, we predict that the pace will pick up in the second half of the year, with CFOs looking to expand their teams, although with caution and at a lower rate than more buoyant years. It will be no surprise that there will be strong hiring activity within Chinese-headquartered conglomerates, many of which have been developing their international footprint rapidly, often using Hong Kong as a launch pad to markets outside of China. Startups will continue to recruit candidates with experience in managing and supporting fintech, mobile development, eCommerce, big data and cyber security businesses. In the second half of 2017, we expect an uptick in hiring activity despite the challenges currently present. However, the competition will remain fierce amongst candidates wanting to land their ideal role.
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Profile Event: ‘Leadership Resilience’

PROFILE BREAKFAST SEMINAR WITH YSC: 'LEADERSHIP RESILIENCE' In conjunction with Bank of America Merrill Lynch (BAML), YSC’s Global Head of Coaching, Shelley Winter, presented at our joint seminar on ‘Leadership Resilience’ on Wednesday, 28th June 2017. This was our very first co-branded event, which was held at the BAML office in Central, Hong Kong. Combining the latest research and client insights, Shelley discussed the importance of organisational resilience and how leaders can cultivate it for themselves and those around them. She also shared why many resilience interventions may raise awareness and create good intentions but fail to enhance on-going resilience. The event was a huge success and one of our largest to date – with close to 100 professionals attending. After facilitating a successful event in Hong Kong, YSC’s Global Head of Coaching, Shelley Winter, flew to Singapore to present on the same topic the very next day, Thursday, 29th June 2017. This session was held at the National University of Singapore Society (NUSS) for another group of senior professionals, and again was very well received. We also had a lucky draw at the end of each session, where 5 attendees received a free YSC resilience assessment test for their company. Profile Breakfast Seminar with YSC and BAML, Hong Kong ​Profile Breakfast Seminar with YSC, Singapore ABOUT SHELLEY WINTER Shelley is a Director in YSC’s Australia & NZ team, having joined YSC in the London office in 2005. She is currently based in Auckland. Shelley is a Registered Psychologist who is passionate about evolving YSC’s coaching practices to stay at the forefront of a rapidly growing industry. As Head of Coaching, she is a member of the Global Practice Leadership team. Interested in change and leadership transitions, she developed YSC’s Resilience Dynamic model. She has worked closely with clients across the financial services, aviation, mining, retail and FMCG industries to develop bespoke talent and leadership solutions. She works as a strategic partner to her clients to shape solutions at the individual, team and organisation level. ABOUT YSC Founded in 1990, YSC are a leadership consulting firm, comprised primarily of consultants with backgrounds in psychology and the behavioural sciences, working with organisations to unlock the power of their people. They have over 100 consultants operating from 20 international YSC offices. ​To learn more about YSC, please visit
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Profile Asset Management Market Update, 2017

The following report provides an update on the key trends that we have observed within the Asset Management employment market in Asia. It identifies emerging themes across the industry and details the major factors impacting hiring and talent movement. OVERVIEW The industry is both cautious and optimistic that much of the uncertainty that kept asset managers awake at night in 2016 is behind us. The two macroeconomic events that caused the most unrest – and most lively debates – were the surprise outcomes of the UK’s Brexit referendum and the US Presidential election. Both the UK leaving the European Union as well as President Trump in Washington will affect markets, regulation and the asset management industry. However, the cloud of pessimism that hung over the end of 2015 and throughout much of 2016 has lifted; the industry is looking at opportunities and, of course, for talented individuals to assist in capturing those opportunities going forward. Just as markets don’t like uncertainty, it is also much more difficult to build business plans in that type of environment. In 2016 this feeling led many global groups to put hiring on hold and to question whether new initiatives were justified. In effect, asset managers pushed these decisions into 2017. As a result, we will see increased activity at the start of this year, particularly as Asia is a focus for most firms we speak to, and as the pace of business in the region demands talented individuals to deliver. We wouldn’t do justice to 2016 without highlighting the bright spots. We saw no slowing down of the China market expansion as both foreign and domestic asset managers and SWFs looked to build out product teams and asset gathering capabilities, as well as the back office functions that go hand in hand with the Hong Kong-Shanghai/Shenzhen Stock Connect scheme. Broadly, legal, compliance and risk functions continue to be a battlefield for talent as institutions look to meet increasingly stringent rules from regulators around the world. From an asset class perspective, fixed income, and specifically Emerging Markets Debt, saw significant inflows and therefore a search for talented individuals to both manage money (at the Analyst and Portfolio Manager level) and to asset gather in this space. We have also seen more firms exploring the private credit space, with several groups hiring Portfolio Managers or indeed entire teams to execute on this opportunity. One of the more interesting developments in hiring across the board is that we see many firms looking outside of a “like for like” candidate pool. With firms having to do more with less, asset managers are increasingly looking to individuals with nuanced or diverse backgrounds. We believe this makes for more sustainable teams, and organisations that will be able to withstand any headwinds which 2017 and beyond may throw their way. INVESTMENT EQUITY In research, we see a similar story as in recent years with an ongoing need for analysts across the board. China analysts are naturally in demand, though we see that it tends to be more at the senior end, senior Portfolio Managers or even CIO hiring is more active now than the last few years. This is a result of groups coming into the market and also because several insurance companies are seeking to hire from pure play asset managers. FIXED INCOME As mentioned in our opening to this report, the fixed income space – and EM Debt more specifically – have seen significant inflows over the past twelve months. Hiring in this space has become more competitive. This is most pronounced in the search for China credit analysts. The exponential growth of the onshore bond markets means that there is simply not enough experienced talent. PRIVATE CREDIT Private credit is perhaps the most sought after capability in the market right now. A perfect storm of a low yield environment, continued demand for double-digit returns and risk-averse banks not able to lend to corporates means that the opportunity set is rife. Asset managers are looking for experienced hires and experienced teams. Assuming an increasing amount of capital follows these buildouts, we would anticipate this trend continuing into 2018. PRIVATE EQUITY The themes have remained much the same as last year; China continues to dominate many investment strategies and it still is rather difficult to raise new funds for some parts of the industry. China represents significant investment opportunities, however many feel that good assets are overvalued. The key is to hire the right people to originate the right deals, and therefore the competition for origination staff with a point of difference, may it be sector, geography or deal size, is crucial. Outside of deal teams there remains a need for those with genuine “asset management” and disposal experience, and in many ways these individuals are even harder to identify as they are not easily in our line of sight. HEDGE FUNDS Likewise, we are seeing themes in line with recent years; there are many global funds that are still not committing fully to Asia, and many Asian funds struggling to raise assets of sustained significance. However, the employers of choice for job seekers are the exception to these. Difficult market conditions and a change of emphasis on different roles means that the risk takers are not so sought after as the risk managers and mitigators. We have seen fund’s bolstering infrastructure, risk management and compliance in a bid to both avoid issues in a tough market and ensure that asset raising efforts are not hampered by a lack of institutional quality within these functions. PRODUCT SPECIALISTS Technical skills and greater seniority are becoming more sought after. In part this is a “do more with fewer team members” approach, and in part there is an increasing need for specialists to communicate more effectively with clients and internal sales teams across a variety of strategies. In particular, we see demand for product specialists that have investment backgrounds in the multi-asset space and in alternatives. WHEN THE CLIENT BECOMES THE COMPETITION While asset managers entering Asia will of course always represent competition for existing players, in the past year we have seen increasing activity amongst onshore China groups looking to expand their product and investment capabilities. We have seen difficult markets and fee sensitivity drive SWFs to bring certain investment capabilities in house. Suddenly the client becomes the competition as these large groups look to hire high-performing teams or individuals. ASSET GATHERING While talent in the asset gathering space is always in demand, institutional sales people with not only relationships but also deep technical expertise are in particularly high demand. Gone are the days of simply wining and dining, which has a very similar meaning to the points we made earlier about product specialists in an investment team, sales people must also be more market-savvy. “The process” is beginning to be valued over personal relationships. Other free services around education, whereby clients seek to learn about certain sectors or products, are also demanded even though they are not supposed to be. Several China onshore AMCs have hired international institutional sales people or teams, just as new entrants to the market are looking for experienced talent and groups that have typically been retail focused look to add institutional coverage. That said, there has been an abundance of activity over the past 2-3 years in the wholesale distribution space as the industry focuses on HNW and retail. The direct impact for the asset management industry has been that asset gatherers with proven experience and a track record of success are able to command exponentially better packages than several years ago. Firms that aren’t prepared to pay above market rates may need to consider looking outside the asset management space for talent. Two aspects of this space have seen transformation, which is worth noting as we look ahead. One is the blurring of lines between asset gathering and client servicing. The combination of more demanding clients and fewer approved support head count mean asset gatherers must be willing to roll their sleeves up in this “new normal” environment. Secondly, we also see RFP roles being moved from headquarters out to Asia where experienced, local candidates are able to merge global messaging with the local language or cultural requirements of regional investors. INFRASTRUCTURE HUMAN RESOURCES Last year began slowly for HR as we saw a consolidation of roles in the Human Resources space. However, from mid-2016 on we have seen some buoyancy in mid-level positions (AVP/VP) and for specialist functions in compensation & benefits, and talent management. These two areas we believe will continue to be a focus for firms as the pool of candidates for any given role no longer comprises just financial services professionals. Equally with high calibre talent in increasing demand, retention is of the utmost importance. As with other pockets of the industry, HR on the buy side has benefited from sell-side firm contraction and/or candidate disillusionment with what is perceived to be a less stable environment. Another aspect of the industry that will impact hiring in 2017 is the demand for HR talent with systems experience or operations expertise. As systems, processes and data management go hand in hand with more efficient and streamlined businesses, HR professionals that can demonstrate knowledge in this space will have opportunities for growth and more seniority. LEGAL & COMPLIANCE As expected in a world of increased financial services scrutiny and regulation, the asset management industry hired more in legal and compliance than in any other department in 2016. The stresses and uncertainties of the sell side have augmented the talent pool for legal & compliance hiring in asset management. On the other side of the coin, retention of existing legal & compliance talent is a key priority for all of our clients. The overarching consideration for candidates these days is less about total package (though this of course is still a key driver) and more about stability when considering new opportunities. Looking ahead candidates with RQFII experience will continue to be in high demand, and the Shenzhen-Hong Kong Stock Connect scheme will likewise demand individuals with Chinese language and regulatory experience. MIDDLE & BACK OFFICE Regionally we have seen an increase in cross-pollination of talent from the sell side and from disciplines outside of their immediate functions. Candidates from audit or operational risk have taken on senior compliance roles, while finance and COO team candidates have moved into AML or audit functions. Risk candidates are another in-demand pool of professionals. Unlike what we understand to be the case in London or New York for instance, individuals who have significant Asia experience and can both assess risk but remain business and growth savvy are particularly valuable to asset managers with regional expansion plans. Likewise, Mandarin speakers who have experience in international firms are highly sought after by Chinese AMCs. AUSTRALIA A VIEW FROM AUSTRALIA This was contributed by Susie Moor, the Founder of East Partnership, and our trusted partner in Australia. 2016 has been the year of the Superfund in Australia, with the emphasis on either hiring or driving product development. A number of the largest funds in Australia have recruited new CIOs and senior investment staff as increasing insourcing of investment capability has continued unabated. While this trajectory commenced in the fixed income and real assets space, there is a slow but persistent move into the listed equities market as well. Scale and a (legislated) focus on fees have been the primary drivers for this continued trend. In the broader market, there has been a real focus in a couple of areas. Firstly, in the listed equity space, there has been a continual product evolution. With the increasing use of passive funds, there has been a move towards the creation of alternative alpha, resulting in the creation of differentiated funds that could then attract a differentiated fee. As such, there has been a push into mid cap, micro cap, concentrated and absolute return funds, with many of the existing larger investment houses using their existing teams to deliver new product. Debt funds are also having their time in the sun. Their consistency of returns in increasingly volatile equity markets is becoming more appealing. There has also been a continued drive into the retail and high net worth market by the larger fund managers that have traditionally focused on the institutional space – either directly or through a LIC. With an increasing number of Australians managing their superannuation directly (approximately a third), this channel is less focused on fees, and is more focused on absolute return, and as such it is proving to be a more profitable segment of the market. We would anticipate more of the same in 2017. Australia is watching with interest the change in administration in the US, and the impact it may have on Australia’s largest trading partners. It should prove to be an interesting year. UNITED KINGDOM ​A VIEW FROM THE UK This was contributed by Basil Reid Thomas, the Founder of Valentine Thomas & Partners, and our trusted partner in the United Kingdom. This is almost certainly the least predictable time in living memory with all manner of pollsters, pundits and economists getting it badly wrong. The lesson from 2016 has been to expect the unexpected. Not only have we seen the UK vote to leave the EU, the US presidential election produced an even more surprising result. And with the political establishment under siege in the Western world, there is no shortage of opportunity for further surprises in 2017 with elections taking place in the Netherlands, France and Germany. Despite all of this, the FTSE 100 ended last year at an all-time high, boosted by a surge in mining companies and overseas earners and hopes of a spending spree by the US President-elect. So what does 2017 hold in store for markets? The performance of active equity managers in 2016 was, on average, pretty woeful. Likewise, it’s been a year to forget for many hedge funds. Both will be hoping for better stock picking conditions as the effects of central bank stimulus weaken. In the UK, we are certainly going to see a rising rates environment with inflation climbing following the depreciation of sterling. Expect to see further consolidation and streamlining following Janus and Henderson’s transatlantic merger, Amundi buying Pioneer, Allianz’s acquisition of Rogge Global Partners and the coming together of Baring Asset Management and Babson Capital. Total median pay for asset managers has dropped for the second year in a row as rising costs and declining profits increase pressure on firms to cut compensation. Many firms have recently introduced restrictions on pay, with Deutsche Bank announcing it was paying ‘doughnut’ bonuses for its top managers, while Aberdeen Asset Management has frozen salaries for senior employees. As in recent years, recruitment in the UK had been characterised by replacement hiring, with businesses pushing for increased productivity from their current employees rather than creating new roles. In terms of front office hiring activity, 2016 saw a number of high profile CEO and leadership appointments and, on the investment side, increased hiring across alternative asset classes. We have seen high levels of activity across institutional distribution (spanning sales, relationship management and consultant relations) and this will continue throughout 2017. ​​​
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