Strengthening Singapore's place in the financial world: Ong Ye Kung

Mindy Tan
Published Tue, Sep 1, 2020 · 09:48 AM

IT is not about growth at all costs, or accepting "trade-offs" for the sake of growth, but about whether as a people Singapore can strengthen its place in the financial world, develop the expertise and seize the opportunities to make Singaporean lives better, said Ong Ye Kung, who is a board member of the Monetary Authority of Singapore (MAS) on Tuesday.

Mr Ong, who is also Minister for Transport, also provided a more detailed breakdown of employment figures. At 13 per cent of Singapore's economy, the financial services sector employs about 171,000 workers. Based on MAS' estimates, about 70 per cent of the workforce are Singaporeans, 14 per cent are permanent residents (PRs), and 16 per cent are work pass holders.

He added: "About 22,000 financial sector jobs were created over the past five years, with 15,000 going to Singaporeans. There are also positive spillovers, contributing to jobs in the legal and accountancy fields, many of which go to Singaporeans."

Indeed, this is one of Singapore's most promising sectors, especially for the young said Mr Ong, noting that every year, up to a third of fresh graduates from the Singapore Management of University and the National University of Singapore's business administration faculty are hired by the financial services sector.

That being said, there remains concern on the ground that the large number of foreigners in senior positions may crowd out Singaporeans. This concern is "understandable" said Mr Ong but added that the higher share of foreigners in senior roles is mainly due to the large international component of the activities Singapore now undertakes.

Singaporeans account for 44 per cent of senior roles, PRs account for 20 per cent and work pass holders 36 per cent.

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"Singapore has grown as a global financial centre as more financial institutions set up regional or global functions in Singapore. They have made us the hub for expertise, networking and oversight of operations in other markets," he said.

"But the staff profile of regional and global activities, like any leading financial centre, tends to be more internationally diverse," he continued. "This is especially so for senior roles. As MNCs, financial institutions will fill these ranks with global expertise that they deploy across their offices."

It is also worth noting that the overall size of the pie has grown. While the share of Singaporeans in senior roles has remained steady, the absolute number of Singaporeans in these roles has increased correspondingly.

From 2014 to 2019, the number of senior positions sited in Singapore grew from 3,900 to 5,900 according to MAS. As such, the absolute number of senior jobs that went to Singaporeans increased from 1,700 to 2,600, representing more than a 50 per cent increase in five years.

Mr Ong also noted that there are promising signs that more locals are taking up roles with international exposure.

"MAS and EDB are in touch with about 2,000 such overseas Singaporeans. About 120 are C-suite executives, another 750 hold director/vice-president positions and higher," he said.

That being said, MAS holds Singapore's financial institutions to high standards and will not condone firms that fall short of fair hiring practices, said Mr Ong. He added that MAS is engaging the financial institutions that are on the Ministry of Manpower's Fair Consideration Framework Watchlist and where their HR practices are found wanting, will make sure improvements are made.

"Another concern is the high concentration of one nationality in the technology departments of financial institutions," he said. "We are furiously growing our local talent pipeline in this area, through mid-career skills upgrading and expanding computer science places rapidly in our universities."

MAS is also working with the industry to groom Singaporeans to be leaders and specialists in financial services. Mr Ong highlighted two schemes, the Finance Associate Management Scheme (FAMS), which supports financial institutions to hire and groom Singaporeans through structured talent development programmes, and the International Postings (iPost) scheme, which incentivises financial institutions to send Singaporeans for international exposure.

"The concern will remain and we need to address it," said Mr Ong.

On that front, MAS has been stepping up engagements with the top leadership of key financial institutions on the need to maintain robust HR practices that are merit-based and support workplace diversity.

Another possible approach is to encourage the offshoring of certain business functions that have less value-add, and which employ a disproportionate share of foreign manpower.

"But any such measures must be approached with caution, because it may not be straightforward to dissect a business into high and low value-add and then outsource the latter. There are often linkages across different functions," said Mr Ong.

In closing, Mr Ong stressed the importance of finding the right discourse. In times of economic difficulties, job insecurity and nativism, the "us-versus-them" perspective may take hold, he said.

"We have seen how toxic the discussion can become in other countries, and how it can change the course of history," he said, adding that this is not a discourse Singaporeans deserve nor one they want.

"We have forged a very close partnership with our financial institutions over the years ... we must continue in concert, to further strengthen this partnership, grow this international financial centre in Asia, invest in and grow our Singaporean talents, and make lives better through the generations."

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