While this annual report focuses on 2019, I must acknowledge what we are experiencing as we compile this document in 2020. As our newly appointed Chair rightly highlights, our operational resilience has certainly been tested by the outbreak of Covid-19.
In my mind, there has been no greater challenge for businesses and communities to overcome in recent times. Having said that, I feel that, as an organisation, we have responded in an appropriate and effective manner to the pressures facing us. Our first concern has been minimising the human impact as our people have contended with the need to take care of their families and community. Equally, every business in Jersey has similarly focused on doing the right thing by their staff and clientele.
This focus continues as we look to the next stage of managing the gradual approach to recovery, yet it is a testament to the integrity of Jersey’s finance industry that amongst the management of very real human needs, regulated businesses have also worked to ensure continuity in the services they provide to their global client base. A significant part of Jersey’s ability to respond to the shocks the world has experienced is its pragmatic commitment to high standards. This is a practical benefit of Jersey’s strong regulatory regime and the high quality people and businesses that operate here.
Jersey’s enviable digital infrastructure has played a part in rapidly enabling the shift from face-to-face business to virtual with minimal impact. For our part, not only have we worked to maintain the right level of engagement between our Supervision team and regulated businesses, but we have also accelerated the progress of our work to digitise our Registry and, where possible, our other initiatives.
Our readiness to respond during the events of early 2020 has been supported by the Government of Jersey’s commitment to ensuring that the environment for doing business accommodates the unexpected. Island agencies have pulled together to protect the environment in which our regulated businesses operate and this, in turn, reinforces the strength of the Island’s collaborative approach to maintaining high standards – not just when times are good, also when times are tough.
The impact of the virus is already substantial. As the Island’s regulator, we will work with our regulated community to navigate our way out of this crisis and hopefully return to the prosperity this Island has enjoyed for many years.
Reflecting on 2019
This annual report details our many achievements during 2019. Over the year, the volume of activity across our Registry, Authorisations, Supervision and Enforcement teams was greater than ever and our work in policy development, as well as information technology and other aspects of our operations, grew in proportion.
2019 was a year when the JFSC also took stock. Alongside all our other work, we undertook that much-needed process of challenge, prioritisation and planning that will ensure our service to the Island remains true to our guiding principles over the coming years.
Developing our strategy for the period to 2023 was not an easy process and I am grateful to our Board of Commissioners, our excellent staff, and key external partners for their part in those constructive conversations that resulted in our four-year strategic roadmap.
A clear message that came out of our planning exercises was that Jersey’s financial services industry holds an enviable position for an international finance centre. The economic success of Jersey will always be subject to the headwinds of the global economy and never more than in 2020 has this been put to the test. Our position as the Island’s regulator is strong enough to weather storms and support our community during harder times.
A period of prosperity
While we know that the picture for the remainder of 2020 presents significant challenges, the stability and growth that Jersey’s financial services industry has experienced means we enter the next stage from a position of strength. As with all jurisdictions, in the coming months and years, Jersey will be put to the test. A key part of passing that test will be ensuring that the Island continues to lead the way in complying with international standards and the global transparency agenda.
Looking back on 2019, the majority of Industry has enjoyed a sustained period of prosperity since the 2007-8 financial crisis. The Net Asset Value of our funds has held record levels, there are more than 300 Jersey Private Funds and, holistically, employee numbers have been stable or have grown. Professional services firms have continued to win business, Jersey banks have experienced stable or increasing deposits and there has been similar stability, or growth, within the other sectors that we regulate.
Opportunities exist to invest in the right infrastructure and to be smart during times that are not so prosperous. We have already made progress with our change programme from 2015 to 2019, which saw marked improvements in our infrastructure, human resources and our approach to risk-based supervision.
But change never stops and 2019 saw the creation of the next stage of our journey; our strategic roadmap, which focuses our work under three priorities and will enhance our regulation and registry operations.
- build even more effective supervision
- embed risk-focused choices throughout our work
- strengthen our organisational resilience.
In 2019, we decided it was time for us to make critical investments, even if some find the inevitable call for increased funding unpopular. Indeed, today we are laying the foundations for success. Foundations that are resilient to change.
As you will see throughout this annual report, the achievements of the JFSC during 2019 have delivered direct benefits to the Island. If 2019 was a year of taking stock and reflection, it was anything but idle. Our people, alongside the vast majority of our Industry, have demonstrated their absolute commitment to improving the work of the JFSC, particularly when it comes to fighting financial crime.
This annual report demonstrates our achievements in 2019 and our vision for the years ahead. It therefore serves as a litmus test for the regulator that we will become by 2023, as we embark on our strategic journey.
Martin Moloney
Director General