From ESG to tax and freedom of movement, our teams across Asia Pacific maintained strong momentum and achieved positive changes for members

AIMA and the ACC’s regulatory strategy in APAC have always followed the motto 'small in Size, big on impact’. While 2022 was a tough environment for some strategies to navigate, with increased volatility globally, it also provided a plethora of opportunities. Across the APAC region, we have been actively advocating the interests of our members alongside regional regulators and policymakers. In the last year, we have submitted more than eight regulatory submissions, conducted close to 70 calls, roundtables, and meetings with regulators, delivered three industry papers, set up four new working groups and expanded two others, and these numbers look to grow further as we close off the year.

ESG remained the hot topic for 2022, dominating the conversations in the alternative investment space. In Hong Kong, a new industry paper was published to guide managers on how to assess the relevance and materiality of climate-related risks. In Japan, a response was submitted to the Japan Financial Services Agency (FSA) on the proposed code of conduct for ESG evaluation and data providers.

Additionally, AIMA established a new Japan ESG Working Group to work on ESG, responsible investment and stewardship-related matters in Japan. In Australia, we held our first dedicated half-day multi-topic ESG event, involving representatives from managers, allocators, and service providers. These efforts across APAC will continue in 2023 with a stream of events around ESG and impact investing.  

Along with ESG, digital assets, cyber security and private credit were the key industry priorities for AIMA APAC this year. We set up four new working groups, including APAC Digital Assets Working Group (DAWG), sister to our global AIMA DAWG, as well as AIMA ACC Technical Working Group and AIMA Global Trade Finance Group. We also expanded the AIMA APAC Cyber and Technology Group by creating a workable framework to allow meaningful engagement with sell-side representatives while preserving its buy-side charm for the group.

Through these additions, we hope to tap into the expertise of top industry leaders as they join forces to create meaningful impact and shape the regulation, education, and thought-leadership efforts for their respective fields, to eventually see major growth and visible change.

Hong Kong

As APAC slowly reopens post-pandemic, efforts to promote our market and develop opportunities for our members are developing rapidly. AIMA APAC launched its latest research paper ‘Alternatives in Hong Kong: Building on the City’s Strengths’, produced in collaboration with PwC. Its key messages were picked up and echoed by accompanying members, media publications and notable Hong Kong government delegates ranging from the Financial Secretary to senior officials from The Hong Kong Securities & Futures Commission (SFC) and Financial Services Development Council (FSDC).

The paper speaks to the future of Hong Kong, provides an overview of Hong Kong’s many opportunities, reflects the range of areas where it can focus to further its success and shares insight and research gathered by PwC through interviews and roundtables with key stakeholders in the alternative asset management sector.

Singapore

With the paper as the backdrop, AIMA APAC hosted the FSDC in Singapore and London. Singapore has witnessed a surge in top-quality individuals, talent, and businesses in the last year. Amid the country’s magnetising pull of international and offshore funds, AIMA has hosted members and other industry partners across conferences such as SuperReturn Asia, SALT iConnections Asia, Hedge Fund Asia Digital Assets by Hedgeweek, and the AVCJ Private Equity & Venture Forum, just to name a few.

Additionally, following the interest of the Singapore OTC Derivatives Reporting industry paper done in 2021, AIMA launched a secondary paper collating frequently asked questions to assist managers with complying with their regulatory obligations under Singapore’s regulations on reporting of OTC derivatives contracts.

Australia

Likewise in Australia, advocating in the interest of members was kept top of mind. Our members came together to highlight talent, flexibility, ingenuity, investment prowess, and operational and risk management excellence as core pillars to focus on and built initiatives around for the year. Through earnest relationships and engagement with policymakers such as the Australia Prudential Regulatory Authority (APRA) and the Australian Securities and Investments Commission (ASIC) and Treasury, AIMA liaised with the Australian authorities on digital asset reforms, submitted a response to the Australian treasury’s draft legislation for foreign financial service providers and a response to ASX consultation paper on the ASX investment products offering.

Japan

Our efforts to strengthen Japan’s attractiveness and advance its status as an international financial centre continue to flourish and evolve through various regulatory and tax initiatives. After the establishment of a new Japan regulatory and Tax committee in 2021, it was full steam ahead as AIMA submitted a proposal to FSA on Japan’s fiscal tax reforms for 2023. The recommendations aim to provide continued tax support to the finance industry, sustain and enhance the growth of Japan’s economy and re-position Japan as a leading global financial hub since the COVID-19 pandemic.

China

While navigating the challenges of the COVID-19 constraints in China, AIMA has maintained our engagement with the China Securities Regulatory Commission (CSRC), Asset Management Association of China (AMAC), other self-regulatory agencies and industry groups to maximise opportunities for our members from the Chinese economic reform and opening-up.

These engagements include the announcement of the latest developments in China’s QFII scheme reform in early September. Through several AIMA events such as AIMA China Live 2022 and related webinars, members gained first-hand insight into the formal introduction of China’s commodity and financial derivatives into QFI investment scope, allowing global investors to be better positioned for diversified alternative strategies for China markets. AIMA APAC continues its work to build our onshore committees to develop China’s economic prowess.

Looking ahead

Next year AIMA APAC will continue its ongoing regulatory reforms through its myriad of work streams responding to regulatory proposals and industry consultations; examples include OTCD report in Singapore and the enforcement regime overhaul in Hong Kong. As we look ahead at key trends and expected opportunities in alternative investment while remaining at the forefront of regulator engagement and consultation across the region, we hope to provide guidance and thought leadership by leveraging the diverse expertise of our members to drive APAC through 2023 and beyond.