Tannock: island has no room for complacency
Bermuda has never faced an array of challenges to its future as an international business jurisdiction like it does today — and there is no room for complacency.
That is the view of Patrick Tannock, chairman of the Association of Bermuda International Companies, who said the world was in a period of “extreme fluidity”, which would require the island to not only adapt to change, but also to embrace and anticipate it.
In a speech at the Bermuda Insurance Market Conference, he said the island had weathered a string of “economic hurricanes” including the Paradise Papers, US tax reform and the EU Council’s economic substance requirements.
This was exacerbated by changes and challenges in the island’s flagship insurance industry, including consolidation, excess capital, high expense ratios, increasing regulatory demands, intense competition, as well as a race to harness the power of new sources of data and to effectively utilise fintech.
“Never before has Bermuda’s relevance and sustainability as an international business jurisdiction faced so many potential game-changers,” Mr Tannock said in his keynote speech at the Bermuda Insurance Market Conference.
“Bermuda has a great track record of responding to the opportunities and challenges that come from change, but we must acknowledge that this is different — very different.
“This is not a remake of an old movie or a sequel. No one has seen this movie before. This is unprecedented and will require an unprecedented response.”
He expressed confidence the island could survive and thrive, but it needed to evolve in this time of fast and accelerating change.
“We’re in an era of extreme fluidity and intense creative destruction driven primarily by an increase in frequency and severity of new and existing perils, technological disruption and alternative capital, where innovation is constantly driving change and new economic orders are quickly replacing existing economic orders,” Mr Tannock said.
“The rate of change continues to exponentially accelerate whether you measure it in terms of computing power, contracting product cycles or the speed of emerging risk issues. The challenge and the opportunity are to keep up with the rate of change.
“The old dynamics that determined market cycles no longer apply and those simply waiting for a market change will eventually be challenged for relevancy.
“Now I’m highlighting how tough it is, because we place ourselves at risk if we are not honest – if our attitude is complacent and entitled, we will lose.”
He added that there was no jurisdiction better situated to capitalise on the opportunities that come from change.
“I believe we must continue what we do well but with a growth mindset to doing it even better to ensure that we remain relevant and current as a market and a leading IB domicile,” Mr Tannock added.
He listed seven things that the island should do:
• Increase speed and efficiency of execution.
• Show proactive adaptability.
• Maintain trust.
• Enhance the customer experience.
• Communicate Bermuda’s value to the world.
• Embrace technology.
• Harness the power of diversity and inclusion.
“As long as we don’t become insular with our thinking and revert to pursuing stability rather than embracing change, we will not only survive, we will thrive and flourish as a jurisdiction of choice,” Mr Tannock concluded.
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