Connect Financial Services Brokers chief executive Paul Tynan issued a statement yesterday warning that while Asia presents significant opportunities for financial service providers, obstacles remain.
“Doing business in Asia will take time and a long term commitment, but if the Australian funds management industry takes their short term performance culture to Asia they will fail,” Mr Tynan said.
According to a statement from Mr Tynan, the “conventional and guarded approach” of Australia’s institutions reflects a lack of “entrepreneurial flair to develop the commercial potential overseas”.
“The conservativeness of Australia’s large financial institutions (banks) is a two edged sword as they are very risk averse and cautious as they stringently safeguard the wealth accumulation and retirement nest eggs of the nation’s investors and working population,” he said.
To encourage smaller private companies to enter into overseas markets, Mr Tynan urged the government to promote its financial incentives for exporter ready businesses.
In addition, he said Australian fund managers would need to promote relationship-building in their marketing to Asian clients, as opposed to product design, returns and cost.
“Business will need to dust off the business cards and focus on developing contacts, networking skills and nurture relationships with local Asian business partners as this is very different to the current marketing to source the superannuation dollar in the Australian market,” the statement read.
Mr Tynan suggested the current global environment was conducive to Australian fund managers breaking into the Asian sector.
“There is no doubt the Asian middle class will explode over the next decade and this sector will demand financial product, food, health, education, technology, entertainment to satisfy their new found wealth,” he said.
Given these favourable conditions, he encouraged the funds management industry to ramp up their engagement with offshore connections.
“To develop these markets business large and small need to start their engagement activities now and proactively support government initiatives, embrace expats, knowledge/networks and most importantly, apply the ‘old world skills’ of relationship management,” he said.
