Quels sont les facteurs de compliance et de regulatory qui permettent à l’écosystème des fonds à Luxembourg de maintenir son leadership?

“Ethics is key to Luxembourg’s funds leadership”

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Luxembourg maintains a leading position when it comes to managing funds, but securing this status may very well depend on our ability to make entrepreneurial decisions. How can compliance and regulatory work with business to assure the competitiveness of Luxembourg’s marketplace?

The Luxembourg marketplace ultimately means a relatively small community of professionals that represent a remarkable concentration of qualitative competencies on fund business, a concentration quite above the average of other international financial centres.

We are already perceived as delivering high standard solutions in a highly regulated and regarded marketplace. Maintaining this competitive advantage requires all of us to apply the highest standards of compliance.

Looking forward, in my mind, in order to allow the fund’s ecosystem in Luxembourg to maintain its leadership position, we need to make sure that our qualitative standards are not offered at the expense of delivering service in a timely and effective manner.

This even when the complexity of the needs we are confronted with renders it less obvious. To be able to deliver this requires us making sure we will continue to develop a sustainable entrepreneurial approach in every level of the organisation that is committed to the highest standards of compliance.

The first concept that comes to my mind is ethics.

Massimoluca MattioliMassimoluca Mattioli, Group head of institutional banking (Banque Havilland)

When it comes to the role that business, compliance and regulatory can together play in supporting a sustainable entrepreneurial approach (to secure the competitive edge and integrity of the marketplace), the first concept that comes to my mind is ethics. For most of us working in the financial sector it is still easier to work with quantitative information rather than qualitative, but we are getting more and more acquainted with this.

For example, is it not the case for non-financial risks, so deeply connected with ethics when it comes to prevailing financial crime, KYC and AML topics? And is it not true that a concept like ethics sounds suddenly extremely relevant if you combine it with the objective of securing the long-term sustainability of the Luxembourg ecosystem?

Business ultimately deals with the efficient allocation of resources (at least this was Keynes’s intuition about the banker’s role at a time the fund industry was still to be born and all the investment projects used to arrive on a banker’s desk). From this point of view, any viable and long-term sustainable business model can only benefit from a proactive compliance and regulatory approach capable of helping the business select the right projects to develop and to identify the best set up to protect the interests of various stakeholders. 

A matter of entrepreneurial assumption of responsibility.

Massimoluca MattioliMassimoluca Mattioli, Group head of institutional banking (Banque Havilland)

Unlike what is commonly said, when it comes to a compliance and regulatory proactive stance, it is not only a matter of technology and standardisation, but also a matter of entrepreneurial assumption of responsibility. It is easy to prepare an endless list of requirements or checks to tick when performing due diligence and setting up a new investment project. However, it requires a deeper understanding to take the responsibility to waive a specific check or requirement after an in-depth analysis and understanding of the individual characteristics of that specific project. 

What could make it difficult for business, compliance and regulatory to adopt a joint and proactive entrepreneurial stance? I would say this ultimately deals with the understandable constraint that some distance needs to be kept by the two worlds (controllers on one side and controlled agents on the other one) in order to preserve the independence of minds. But as a matter of facts it will never be just a matter of controllers monitoring agents because a permanent confrontation mood in the long run will jeopardise the capacity to meet clients’ needs in a timely and effective manner. For these reasons, ethics comes into the picture and needs to find its role at the core of an ecosystem that has the ambition to maintain a leadership position. 

Share an outstanding alignment on the ethical parameters.

Massimoluca MattioliMassimoluca Mattioli, Group head of institutional banking (Banque Havilland)

Business, compliance and regulatory need to share an outstanding alignment on the ethical parameters that allow business models and specific projects to be viable and sustainable in the long term. Only this kind of deep sharing will allow the two worlds to jointly deliver timely and effective solutions to the increasingly complex needs of worldwide investors and promoters without fear of inappropriate behaviours. 

Ultimately, ethics as major grounding of a sustainable entrepreneurial approach is the leading concept that will possibly allow the Luxembourg brand to continue to be perceived as a mark of joint quality and effectiveness.