Proper Financial Advise is Necessary for CPF Investments

I find it difficult to sympathise with stupid people.  When we have cases like this, the primary cause seems to be greed.  There is little to fault with the system.  There are levels of compliance, and a balanced scorecard system.  There are thousands of financial advisors working for banks, fund houses, and insurers.  There is a fact find and KYC system.  And yet, we keep hearing of many cases where people invested in something that promised them ridiculous yields, without considering the plausibility of it.  Greed blinds people to consequences. 

In general, it is important to understand risk tolerance, investment horizon, and the nature of the investment.  What is the underlying asset?  What if there is a turn in the market?  What about political risk, and currency exposure?  This is why there is a need to have proper financial advise.

The Appeal of Asian Bonds

Two quarters later, the Federal Reserve remains dovish on interest rates, despite the passage of a record stimulus package.  Because of the change of policy on the 2% inflation target, they have more leeway in policy.  The emphasis is on economic recovery, and less on inflationary fears.  Federal Reserve is committed to keeping policy rates on hold until the US labour market has achieved maximum employment, and inflation averages 2% over time.  This would imply that the US policy rate will stay at 0% to 0.25% until well into 2023.  10-year Treasury bond yield will likely be capped at 1% due to inflationary fears. 

For Asian bonds, growth outlook is supported by better management of the Covid-19 pandemic than in Europe and North America. Countries across the region will register positive growth as the region opens up faster than the rest of the world.  The subdued inflation and attractive yield differential between Asian sovereign bonds and US Treasuries make Asian debt instruments appealing.

Some Details about CareShield Life

CareShield Life is a form of long-term care insurance, meant to provide financial protection against long-term care costs, in the event of disability.  It is meant for Singaporeans.  The policy provides lifetime cash payouts, for as long as the insured remain severely disabled.  These payouts increasing, from $600 per month.  It is subsidised by the government to keep it affordable, and Inability to pay does not result in the loss of coverage.  The premiums can be fully paid by MediSave. 

From a policy perspective, it is cheaper to subsidise the insurance coverage for long-term care for an ageing population, than to directly cover the costs of caring for them.  Reinsurance allows the risk to be spread, and portfolio pricing for citizens keeps mortality charges low.

Singapore’s Asset Management Boom Impressive Numbers, & a Warning Buried Inside Them

Singapore’s asset management industry has delivered a stronger recovery than most forecasts anticipated.  Assets under management rose 10% to reach S$5.41 trillion, driven by higher valuations and net inflows across both traditional and alternative asset classes.  The wealth management sector recorded over 8% growth in a single year, with a five-year compound annual growth rate sitting around 10%.  These are not modest numbers for a city-state with a population smaller than New York.

The Family Office Surge

The growth in single family offices tells the more striking story.  The number of SFOs receiving tax incentives from the Monetary Authority of Singapore grew from roughly 400 in 2020 to over 2,000 by the end of 2024, a 250% increase in under five years.  Chee Hong Tat, Deputy Chairman of the Monetary Authority of Singapore and Second Minister for Finance, confirmed the figure had reached 2,000 in 2024, up from 1,650 the previous September, speaking at the UBS Asia Wealth Forum.  Singapore has, in the process, displaced both Switzerland and Hong Kong as the preferred domicile for ultra-high-net-worth Asian families, a genuine shift in global wealth management geography rather than a marginal statistical blip.

Why the Capital Keeps Arriving

None of this happened by accident.  In an uncertain post-pandemic world, with the United States and China still locked in a prolonged trade dispute, Singapore functions as the natural neutral ground for capital that needs to remain deployable on either side of that divide.  The tax regime reinforces the pull directly.  No capital gains tax.  No inheritance tax.  A stable currency, a transparent legal system, and a regulatory framework wealthy families trust considerably more than the alternatives currently on offer in the region.  Fund managers channel a portion of this capital toward regional startups and toward strategically favoured sectors, electric vehicles and manufacturing among them, positioning Singapore not merely as a place to store wealth but as a genuine launchpad for regional deployment.

The Warning

Here is where the celebration needs a pause.  A city-state absorbing this volume of capital, this quickly, cannot assume every inflow is clean, productive, or genuinely intended for the purposes stated on the application form.  Singapore’s own 2023 money laundering case, involving roughly S$3 billion in seized assets tied to a foreign crime syndicate, remains the starkest recent reminder that rapid capital inflows attract exactly the kind of money nobody wants sitting inside a reputable financial centre.  MAS has responded with genuine tightening, not merely rhetoric.  As of 2024, MAS actively rejects family office applicants whose structures exist only on paper, screening for real staff, documented investment activity, and substantive local business spending rather than a nominal presence designed purely to secure a tax incentive or a residency pathway.

The Substance Test

Under the current framework, a single family office must maintain a minimum of S$20 million in assets under management at the point of application, spend at least S$200,000 annually on local salaries, professional fees, rent, and technology, and employ at least two Singapore-based investment professionals holding a CFA, CPA, or MAS-recognised equivalent qualification.  These are not decorative requirements.  They exist specifically to separate genuine wealth management operations from shell structures parked in Singapore purely for the tax certificate.

The Verdict

Singapore’s S$5.41 trillion in assets under management, and its 2,000-strong family office ecosystem, represent a genuine and well-earned vote of confidence from global capital navigating an increasingly fractured world.  The tax regime, the political stability, and the regulatory credibility all deserve the credit they are receiving.  What deserves equal attention is the discipline MAS is now applying to keep that inflow genuine, because a wealth hub that stops screening its applicants stops being a wealth hub and starts being a laundromat with better marketing.  Singapore has, so far, chosen the harder and more credible path.  It needs to keep choosing it every single year this growth continues, not merely in the years the headlines are watching.

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Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code

Inspirational Leadership is a Learnable Skill

Inspirational leadership is a skill that may be acquired.  Leadership itself is an active, continual process of incremental improvement and striving.  Leadership does not merely happen.  It is a culmination of a lot of work and experience.  It is the sum of applied experiential knowledge.  Leadership is the art of providing direction, giving people a vision, and inspiring them to work towards that vision.  The best of leaders develop other leaders, nurture talent, and inspire them.  The best teams are teams of such inspiring leaders. 

Contrary to what most people believe, there is no one type of leader, or leadership style.  What we have are broad definitions of leadership, and even then, they have little relation to what actual leadership actually is, since these ideas are theoretical interpretations of reality without nuance.  Every single person is different, with their own historical baggage, own talents, and own prejudices.  Leadership is developed by taking it all down to the common denominator of humanity, and developing something within what each person is.  Leadership begins with values. 

It is a truism of Sufism, and many other philosophies, that knowing begins with the self.  We do not spend enough time, in this modern world, getting to know ourselves.  We need quiet time to sit aside, and question our intentions, to consider the voices within, and focus on the ones that elevate us, while ignoring the voices of doubt and despair.  We then need to question the intent of what we do, and why we do it.  It is always important to clarify the intent of any action we plan.  Then, we have that foundation to develop a leadership style. 

Just as we spend time knowing ourselves, we must then spend time knowing the people around us, the ones we build our team from.  This is more than just reading their personnel files, and knowing their academic qualifications.  This is about trying to understand their motivations, their needs, their challenges.  This is about walking in their shoes, and seeking to know who they are as people.  Knowing people means we develop connections and relationships.  It means we are better placed to nurture them, encourage them, inspire them.  We are no longer merely colleagues. 

Now that we know the team, we have to develop our communication channels.  This means understanding how to give an evaluation of performance and development, and having that mix of criticism and praise in our feedback to them.  It has to be honest, but it must also be constructive, subscribable, addressable, and measureable. 

As part of that feedback process, it is important to be transparent about the decision-making process as well.  This is especially pertinent when addressed disputes within the team, and fixing any form of dysfunction in the team dynamic before it takes root.  All members of the team need to feel safe enough to have their point of view without the feeling that they have to defend themselves.  We need to cultivate this plurality of views to prevent groupthink. 

Now that we have addressed the team dynamic, and values, we can talk about direction.  For there to be inspiration, there has to be positive movement.  People need to feel that they are part of something greater than themselves.  This means setting long-term and short-term priorities, and creating milestones appropriate to each category that are achievable.  There is no sense being overly-ambitious, and failing to meet deadlines because of this.  It is bad for morale, and undermines leadership credibility.  Once these long-term and short-term priorities have been set, it is important to explain the overall strategic plan specific to the team, that is married to this tactical plan.  Otherwise, they would not feel invested in it as much as they should.  This also means that these goals can be adjusted as the circumstances change, allowing tactical flexibility and giving the team ownership. 

When these steps can be implemented and reinforced, we have now created a culture of excellence that is replicable.  We are not just inspiring the team, but we are giving them the tools and opportunities to grow to become leaders in their own right.

Corporate Culture Must Be Cultivated, Not Left to Chance

A garden needs tending; otherwise, it becomes overgrown, infested with weeds, and even breeding vermin.  What was once an enhancement becomes an eyesore.  Company culture works the same way.  It is an intangible asset that needs maintenance.  Left unattended, it becomes a liability, and the consequences reach considerably further than revenue alone.

Culture is an Asset Worth Protecting

Company culture, properly implemented and maintained, produces higher job satisfaction, greater productivity, and a nurturing environment for innovation.  It inspires staff and management alike to perform better and builds a genuine culture of excellence.  A positive culture becomes part of the brand itself, quantifiable, in effect, as goodwill on the balance sheet.

Southwest Airlines, under co-founder Herbert David Kelleher, built its entire business around this principle.  Kelleher famously hired for attitude and trained for skill, reportedly turning down technically stronger candidates in favour of ones who fit the airline’s culture of warmth and humour.  Southwest posted 47 consecutive years of profitability, an achievement almost unheard of in an industry defined by volatility, and analysts have repeatedly credited that culture, not fuel hedging or route strategy alone, as the durable advantage underneath it.

How Toxic Culture Takes Root

A toxic culture develops over time when management sets a bad example or neglects to weed out bad habits creeping in.  Cliques form.  Favouritism replaces merit.  Talent begins to leave.  Of greater concern are instances of sexual harassment, discrimination, and insular attitudes, which cost market competitiveness and expose the company to negative goodwill and legal action.

Uber’s own culture under founder Travis Cordell Kalanick offers the clearest cautionary tale of the last decade.  Engineer Susan J. Fowler published a blog post in February 2017 detailing sustained sexual harassment and a Human Resources department that repeatedly protected a high-performing manager over addressing her complaints.  The post triggered an internal investigation, the departure of over twenty employees, and ultimately Kalanick’s own resignation as CEO in June 2017.  Uber had built its internal culture around a value literally called “Toe-Stepping,” celebrating aggressive, boundary-pushing behaviour as a virtue.  The company later paid an estimated US$4.4 million settlement connected to the harassment claims, alongside considerable reputational damage that outlasted the executive team responsible for it.

Neglecting Your People is the First Real Risk

Inadequate investment in employees is the first structural risk.  Investment means ensuring people feel part of the company’s success, and genuinely gain from it, through promotion, career development, and recognition, not compensation alone.  When employees feel short-changed, they disengage.  They stop innovating.  Cynicism spreads, engagement drops, and passive-aggressive behaviour becomes the norm.

Wells Fargo’s fake accounts scandal, exposed in 2016, shows where unchecked pressure on employees leads.  Branch staff, facing unrealistic cross-selling quotas, opened roughly 3.5 million unauthorised accounts and credit cards in customers’ names over several years just to hit management’s targets.  Employees who raised concerns were reportedly ignored or dismissed.  Chief Executive Officer John Stumpf resigned in 2016, and the bank ultimately paid over US$3 billion in fines and settlements.  The employees were not the root cause.  The incentive structure management built around them was.

Accountability Cannot Bend for Seniority

At board level, values must cascade downward, with everyone held responsible for their own behaviour.  No favouritism in hiring.  No leniency for seniority or connections.  No free pass for bullying or discrimination, regardless of position.

Volkswagen’s “Dieselgate” scandal, exposed in September 2015, remains the starkest illustration of what happens when accountability disappears from an organisation under pressure to perform.  Engineers installed defeat devices in roughly 11 million diesel vehicles worldwide, software designed specifically to detect emissions testing and cheat the results.  Chief Executive Officer Martin Winterkorn resigned days after the scandal broke.  Volkswagen’s total costs, fines, settlements, and vehicle buybacks eventually exceeded US$30 billion.  The fraud did not emerge from a single rogue engineer.  It emerged from a culture where aggressive targets were set from the top, and nobody in the chain felt safe enough, or accountable enough, to say the targets were unachievable honestly.

Groupthink is a Business Risk, Not Just an HR Concern

Lack of diversity carries dangers on multiple levels.  Groupthink develops when everyone shares similar perspectives, creating a disconnect between the company and segments of the market it is trying to serve.  A sense of “the other” breeds prejudice, isolation, and microaggression, opening the company to negative goodwill and legal exposure.

Amazon discovered this the hard way with an internal AI recruiting tool it began building in 2014.  The system, trained predominantly on resumes submitted over the previous decade, a period dominated by male applicants in technical roles, taught itself to penalise resumes containing the word “women’s,” as in “women’s chess club captain,” and downgraded graduates of two all-women’s colleges.  Amazon’s own engineers discovered the bias in 2015 and scrapped the project entirely in 2018, after determining the gender bias could not be reliably corrected.  A homogenous training dataset, built from a homogenous hiring history, simply reproduced and automated the bias a diverse hiring process would have caught far earlier.

The Gap Between Stated Values and Leadership Behaviour Destroys Everything

The final risk is a disconnect between a company’s stated values and the actual example set by its leadership.  Ethical lapses at the top – insider trading, fraud, bribery – do not arise in a vacuum.  They arise in an environment that rewards profit over principle, and the damage outlasts the offender’s own departure.

Enron remains the definitive case study.  Under Chief Executive Officer Jeffrey Skilling, the company ran a “rank and yank” performance system, ranking employees and firing the bottom 15% annually, an incentive structure that rewarded aggressive, and eventually fraudulent, accounting over honest reporting.  Vice President Sherron Watkins internally warned Chairman Kenneth Lay in August 2001 that the company’s accounting practices could cause it to “implode in a wave of accounting scandals.”  Her warning went largely unheeded.  Enron filed for bankruptcy in December 2001, wiping out roughly US$74 billion in shareholder value and thousands of employees’ retirement savings, most of it concentrated in company stock the culture had encouraged them to hold.  Watkins later testified before Congress, and her name became shorthand for what a whistleblower protected properly, rather than ignored, might have prevented.

Zappos, under Chief Executive Officer Tony Hsieh, took the opposite approach entirely.  New hires completing initial training were offered “The Offer,” a cash payment, eventually rising to US$2,000, to quit immediately if they felt the company’s culture was not right for them.  The logic was blunt: an employee who stays purely for the pay cheque, rather than cultural fit, becomes the disengaged, cynical presence that erodes everything a culture is trying to build.  Zappos built its reputation, and its eventual US$1.2 billion acquisition by Amazon in 2009, substantially on the strength of a customer service culture it had spent years designing, rather than hoping would emerge naturally.

What Must Be Done

Securing explicit, legally enforceable commitment from every employee, from board level downward, is the first step.  The board must be seen embracing and advancing these values, named and expounded upon, embedded formally within Compliance.

Corporate culture should never be left to develop over time by accident.  It must be planned, cultivated, and nurtured, beginning with documentation that defines it and programmes that reinforce it.  It cannot sit inside a single department.  It is a multi-departmental effort spanning Human Resources, Legal, Compliance, and Corporate Communications, headed by someone reporting directly to the board, engaging external stakeholders, unions, vendors, and contractors, who both shape and are shaped by it.

A reward and proscription programme must sit alongside this, with clearly defined ethical standards and explicit consequences for misconduct, all the way to termination and legal action, a known carrot and stick, built into the ongoing education of the workforce rather than left to chance.

Company culture should be the foundation of a company’s market position, strategic development, and planning process, evaluated as a KPI, not treated as a distinct concern separate from the core business.  Done right, it protects a company against negative goodwill and scandal, develops talent, and drives growth.  Uber, Wells Fargo, Volkswagen, and Enron all learned this lesson at a cost measured in billions of dollars and, in some cases, criminal convictions.  Southwest and Zappos built the opposite outcome.  Customers ultimately want to buy into a company’s story.  It remains management’s responsibility to build one worth subscribing to, before the market decides that story for them instead.

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Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code

Three Habits as a Foundation of Success

Growing a company or a team requires more than just ability and enthusiasm.  It requires a change of mindset, and a commitment to an overarching plan.  Without that level of commitment, a company or team cannot succeed and gain market share, or traction, depending.  Those commitments are built on small habits we need to acquire, individually, and as a team.  We begin with three habits to inculcate. 

The first habit we must acquire is the habit of effective communication.  Many examples of misunderstanding arise out of what is often left unsaid, which allows people to fill in the blanks with their ideas and notions, often borne out of a flawed perspective due to that lack of information.  Effective communication is borne out of two parts: what is said, and what is heard.  When we speak, in the context of leadership, the intent is to instruct, to inform, or to advise.  In all conditions, it should be explicit, clearly understood, with no ambiguity in salient points.  There is a lot of emphasis on this, because it is something overt and obvious.  The focus is on the self, and that is something very much within our control.  When we communicate, we wear the mask of the speaker persona, and we try and channel the people we represent, the team, so that they are invested. 

The second part of communication is listening.  Active listening is a lot harder than speaking, since the focus is on the other, and not the self.  When we learn to listen intently, we learn to communicate better.  Active listening is not merely about what is said, but how it is said, and what is left unsaid.  It is about understanding, also, how different members of the team, stakeholders and internal and external customers receive what is being said, and how they react to it.  People bring to any communication their unconscious baggage, and that must be factored into how we communicate with them. 

The second habit is continuous learning.  The world is changing, and that change is coming at an increasing rate.  It is important to appraised of current events, technological developments in related fields, business trends, market movements, and cultural evolution.  It is also important to have some form of grounding in general knowledge, business knowledge, industry-specific knowledge, as well as develop an appreciation of the arts, literature, history, and the natural sciences.  When we stop learning, when we cease to have that sense of wonder, when we forget to see the world in a new light, we ossify and stagnate.  It is insight that helps us develop our business strategies, see opportunities where others may miss, and find ways to disrupt the industry we are in.  Continuous learning is also found in regular training and sharing sessions, to inculcate that sense of curiosity and thirst of knowledge.  This is a value that must be demonstrated by leadership at every level, and be part of company or team culture.  Continuous learning is a value that drives innovation, growth, and research and development. 

The third habit is to develop systems.  Systems thinking organises the processes of what we do so that decisions are quick, dissemination of information efficient, and gathering of data is thorough.  Systems thinking is a trait that must be cultivated, documented, and implemented, so that the unavailability of some people does not jam the processes of the system.  Things still get done, people understand their contingencies, and morale is maintained even in trying times because there is always some form of direction.  Systems done correctly empower people, allow tracking of people and resources, and locate inefficiencies that can be addressed. 

These three habits are the foundations of building a successful company, organisation, or team.  We need to communicate, we need to learn, and we need to implement what we know and understand in a subscribable, replicable system, so that processes and quality is maintained, and eventually improve.