But despite the ever-changing environment and disruption, Jersey’s international finance centre (IFC) has proved forward-thinking and innovative throughout, while the pandemic has served to heighten our focus as a jurisdiction of resilience, connectivity, stability and sustainability.
So, if we look back at 2021 – itself a landmark year since it was the 60th anniversary of the birth of Jersey’s modern international financial services industry – there were some key milestones and highlights worth noting.
Sustained buoyant private equity activity continued to drive growth in Jersey’s investment funds sector in 2021 as the total value of fund assets administered in the jurisdiction grew by £26.3 billion to stand at a new record level of £436.3 billion at the mid-year point. The popular Jersey Private Funds structure, designed for small groups of sophisticated and professional investors, also continued to grow (up 13% at the half-year point).
In addition, the number of fund managers choosing to market their funds into the EU through Jersey using national private placement regimes (NPPR) is continuing to rise. This is positive news in the post-Brexit environment. It indicates that non-EU managers are still finding appeal in the private placement option Jersey provides, enabling them to access vital EU capital.
Jersey is also home to the greatest number of FTSE 100 and AIM listed companies registered outside the UK; and more than 20 reputable, international banks are based here.
Numbers aside, it was also a significant year in other respects.
Last month, we launched an important new research paper entitled ‘Jersey’s Contribution to Global Value Chains’. We commissioned the Centre of Economics and Business Research (Cebr) to help us understand how much our financial services industry supports economic activity around the world. Indeed, Jersey is a key location for pooling capital and for facilitating international trade and economic activity. Value chains are the full range of activities that firms and workers undertake to bring products or services from conception to end use and beyond, within the same firm or divided among different firms and countries. Jersey plays an important role in the efficient functioning of these value chains and economies globally. The research revealed that on average, each year during the period examined (2017 to 2020), £1.4 trillion of capital was intermediated in Jersey and this supported £170.3 billion of global economic output, 5.1 million jobs worldwide, and £73.3 billion in associated wages, through global value chains facilitated by the Island.
It is a powerful piece of work. The research highlights Jersey’s global reach and the positive value our Island’s finance industry adds to international markets.
It was also the 10th anniversary since we established a presence in the UAE and we tied that milestone to the launch of another relevant study in collaboration with Gateway Global, delving into the attitudes towards the Islamic finance wealth management market by Muslim high net worth individuals.
Sustainable finance was a theme that could not be ignored in 2021 and no doubt it will resonate still more in the years ahead. Sustainability, in general, has become a strategic priority in recent years and the dramatic events of the global pandemic placed environmental, social and governance (ESG) thinking into even sharper focus. As a forward-thinking IFC, we responded to the speed of change and launched a sustainable finance strategy in March last year, including a vision that Jersey will be recognised by clients, stakeholders and other partners as the leading sustainable international finance centre in the markets we serve by 2030.
Late last year, Jersey was admitted to the International Network of Financial Centres for Sustainability (FC4S), a collective of international financial centres working together to achieve the UN’s Sustainable Development Goals (SDGs) and the Paris Agreement. It’s the latest in a series of new collaborations the jurisdiction has committed to with international bodies to support the scaling up of sustainable finance
Critically, our strategy is set against the backdrop of Jersey’s government setting itself the ambitious target of making the Island carbon neutral by 2030 – so it has been important for our strategy to be inclusive and sensitive to the efforts of the Island’s leaders, regulators and the people of Jersey in realising that ambition.
Also at home, and to celebrate the 60th anniversary milestone, we set an ambitious fundraising goal of £60,000, all of which will be earmarked for local charities via the Association of Jersey Charities (AJC). In July we’ll be hosting a Charity Ball and all proceeds from sponsorship, ticket sales, fundraising activity on the night will be donated to the AJC.
Topping off another successful year as an IFC, it was an honour that Wealthbriefing MENA Awards recognised Jersey as the leading IFC for the fifth year running. Jersey was also crowned ‘International Finance Centre of the Year’ at the Citywealth International Finance Centre Awards.
Overall, 2021 was a positive year for Jersey as an IFC and as we look forward to 2022, we believe our global connectivity has the potential to really set us apart and, to that end, we will be evolving and diversifying our overseas engagement and events program, recognising that we are now operating in a far more complex and nuanced world. At the same time, we appreciate that working alongside local and international partners, we have a vital role to play in supporting better futures for local and global economies as they transition from these particularly testing times.