The clue was that Georges Elhedery had been learning Mandarin in addition to his native Arabic and the English of global banking.
For the past six months, Elhedery, a senior executive at the top of HSBC, had been absent from his desk. As co-chief of global banking and markets, he’d taken a sabbatical, for his “personal development”. No sooner did he return this autumn, however, than it was announced that Elhedery, 48, would be succeeding Ewen Stevenson as chief financial officer. Stevenson is leaving the group.
The shock was that, until then, many of those around the top of the bank and its investors assumed that Stevenson, 56, was heir apparent to the group chief executive, Noel Quinn. The trouble is, so too, it seems, did Stevenson. He’s said to have sought assurances from the board that he was the next in line and he was not keen to have to wait. Oh dear. It doesn’t pay in the corporate world to thrust and to make demands, to force a board into a corner.
We may enjoy regarding bankers as macho aggressive types who like nothing more than to shove rivals out of their way. Putting the spotlight on them and their apparent suitability for the top job is to focus those with the power to rise to the top. Or more often to come up with reasons why it should not be them. The result is that frequently, it’s the quieter one, the dark horse from leftfield, who emerges.
At HSBC, Stevenson, it seems, overplayed his hand and paid the price. If he’d studied his bank history, Stevenson would have realised there was a precedent. When Stephen Green left as executive chairman in 2010 to become Lord Green and a minister in the UK government, it was widely believed that Michael Geoghegan, the rumbustious chief executive, was a shoo-in. Bookmaker Paddy Power certainly thought so, installing Geoghegan as favourite. But Geoghegan, an HSBC lifer and Green’s right-hand during a period of spectacular growth for the bank, was overlooked in favour of Douglas Flint, the chief financial officer.
Instead of continuing along a path laid by Green and taking the natural step of anointing his long-time Number Two, the board seized theFlint was preferred because he was smoother and he was more regarded by banking regulators. Geoghegan exited with dignity, writing to the board to say he would “remain HSBC’s biggest fan”, but his disappointment was palpable.
Elhedery ticks all the boxes for a global, heavyweight banker. His father was a banker in Beirut, his mother a schoolteacher. He studied at the elite finishing school for would-be star managers, the Ecole Polytechnique in Paris. A spell at a French public sector bank was followed by Goldman Sachs and Paribas, before he joined HSBC in 2005.
He’s got the sporting, daring spirit: snowboarding and holding a pilot’s licence. He’s a polyglot to boot, fluent in Arabic, French, English, German and Spanish.
Which is why adding Mandarin Chinese to that list should have given a hint. According to one colleague, “he just did [Mandarin] for fun.” Of course, he did.
Which begs the question, why of all languages did he choose that one? Why not Russian or Italian, “for fun”?
The answer might have something to do with the fact that HSBC relies on Asia, especially China, for 70 per cent of its profits and Ping An, the Chinese insurer and its largest shareholder, is calling for the bank to be broken up and the Asian arm separately spun-off.
Having someone in the financial top post, possibly the very highest in due course, who can get by in mandarin and display requisite respect and courtesy by speaking to the Chinese at least some of the time in their language, would, right now, pay dividends. It shows intent and seriousness, a willingness to bridge the divide.
For HSBC, nothing has been as fraught as its own identity and relationship with China. It’s been the bugbear of numerous phalanxes of bank bosses down the years: is the group China-centric with an international outlook or international with a heavy concentration on China?
When Hong Kong was a British colony, it did not matter so much. HSBC was a company that grew up out of Empire and was run along colonial, militaristic lines. Its international managers were “officers”, they were single, non-university educated males who shared accommodation called “chummeries” that were akin to the officer’s mess in the army. They did not go on holiday but on “leave”. As recently as the 1980’s, they were supposed to seek the chairman’s permission to marry.
HSBC was known in banking circles as the “Honkers and Shankers”, in reference to its roots in Hong Kong and Shanghai. Then came handover to Beijing and HSBC moved its headquarters from the spectacular landmark building on Hong Kong harbour for one of the towers at Canary Wharf in London.
Emotionally and commercially, however, the draw has always been back to the Far East, to China.
The bank switched outlook, too, under Green determinedly setting out to become the biggest bank in the world. This led to major acquisitions of banks and financial businesses across the globe, in regions where hitherto it had not been concentrated.
Emotionally and commercially, however, the draw has always been back to the Far East, to China. That’s come to the surface repeatedly amid speculation the head office would return to its original Hong Kong home. Now, comes Ping An.
So far, HSBC has rebutted the main Chinese argument that the Asian side would prosper even more if it was not held back by the rest of the world. The counter is that the Asian bank would become AN Other Asian bank, akin to a Standard Chartered, without the international financial clout and reach that being part of the bigger, wider HSBC provides.
The pressure, though, is relentless and the Chinese do not play a short game. Enter a new broom to provide a smoother approach.
Like several of his top tier colleagues, Elhedery has not worked in Asia for the bank, he’s not been based there – a bone of contention with Ping An, which has added to its litany of complaints the one that senior HSBC executives lack sufficient Asian experience. He does, though, speak Mandarin, which can only help.
Chris Blackhurst is the author of Too Big To Jail – Inside HSBC, the Mexican drug cartels and the greatest banking scandal of the century (Macmillan)
Vidaamuyarchi
Director: Magizh Thirumeni
Stars: Ajith Kumar, Arjun Sarja, Trisha Krishnan, Regina Cassandra
Rating: 4/5
The President's Cake
Director: Hasan Hadi
Starring: Baneen Ahmad Nayyef, Waheed Thabet Khreibat, Sajad Mohamad Qasem
Rating: 4/5
Ad Astra
Director: James Gray
Stars: Brad Pitt, Tommy Lee Jones
Five out of five stars
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
Islamophobia definition
A widely accepted definition was made by the All Party Parliamentary Group on British Muslims in 2019: “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.” It further defines it as “inciting hatred or violence against Muslims”.
TEACHERS' PAY - WHAT YOU NEED TO KNOW
Pay varies significantly depending on the school, its rating and the curriculum. Here's a rough guide as of January 2021:
- top end schools tend to pay Dh16,000-17,000 a month - plus a monthly housing allowance of up to Dh6,000. These tend to be British curriculum schools rated 'outstanding' or 'very good', followed by American schools
- average salary across curriculums and skill levels is about Dh10,000, recruiters say
- it is becoming more common for schools to provide accommodation, sometimes in an apartment block with other teachers, rather than hand teachers a cash housing allowance
- some strong performing schools have cut back on salaries since the pandemic began, sometimes offering Dh16,000 including the housing allowance, which reflects the slump in rental costs, and sheer demand for jobs
- maths and science teachers are most in demand and some schools will pay up to Dh3,000 more than other teachers in recognition of their technical skills
- at the other end of the market, teachers in some Indian schools, where fees are lower and competition among applicants is intense, can be paid as low as Dh3,000 per month
- in Indian schools, it has also become common for teachers to share residential accommodation, living in a block with colleagues
The specs: 2019 Haval H6
Price, base: Dh69,900
Engine: 2.0-litre turbocharged four-cylinder
Transmission: Seven-speed automatic
Power: 197hp @ 5,500rpm
Torque: 315Nm @ 2,000rpm
Fuel economy, combined: 7.0L / 100km
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
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Results
6.30pm: Maiden Dh165,000 (Dirt) 1,400m. Winner: Rio Angie, Pat Dobbs (jockey), Doug Watson (trainer).
7.05pm: Handicap Dh170,000 (D) 1,600m. Winner: Trenchard, Pat Dobbs, Doug Watson.
7.40pm: Maiden Dh165,000 (D) 1,600m. Winner: Mulfit, Pat Dobbs, Doug Watson.
8.15pm: Handicap Dh210,000 (D) 1,200m. Winner: Waady, Dane O’Neill, Doug Watson.
8.50pm: Handicap Dh210,000 (D) 2,000m. Winner: Tried And True, Pat Dobbs, Doug Watson.
9.25pm:Handicap Dh185,000 (D) 1,400m. Winner: Midnight Sands, Pat Dobbs, Doug Watson.
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
Squid Game season two
Director: Hwang Dong-hyuk
Stars: Lee Jung-jae, Wi Ha-joon and Lee Byung-hun
Rating: 4.5/5
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KILLING OF QASSEM SULEIMANI
A State of Passion
Directors: Carol Mansour and Muna Khalidi
Stars: Dr Ghassan Abu-Sittah
Rating: 4/5
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Graduated from the American University of Sharjah
She is the eldest of three brothers and two sisters
Has helped solve 15 cases of electric shocks
Enjoys travelling, reading and horse riding
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Profile
Company: Justmop.com
Date started: December 2015
Founders: Kerem Kuyucu and Cagatay Ozcan
Sector: Technology and home services
Based: Jumeirah Lake Towers, Dubai
Size: 55 employees and 100,000 cleaning requests a month
Funding: The company’s investors include Collective Spark, Faith Capital Holding, Oak Capital, VentureFriends, and 500 Startups.
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Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Defence review at a glance
• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
• Prioritise a shift towards working with AI and autonomous systems
• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
• More F-35 fighter jets required in the next decade
• New “hybrid Navy” with AUKUS submarines and autonomous vessels
Andor
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