Following on from an earlier post, lets take a look at the first full-scale trial of eBAM that has so far been completed, Bank of New York Mellon and a number of corporates agreed to participate with SWIFT and Wall Street Systems to test naming conventions and message handling protocols under an industry-first eBAM implementation.

SWIFT was approached by both banks and corporates to create and take ownership of nascent eBAM standards. It is one of the first non-financial standards that SWIFT has created, but the value to the industry is clear for all to see. SWIFT already has the channels in place for banks and corporates to use and has a proven track record of stewardship of industry standards.

Importantly, SWIFT also has a track record of continued investment in standards, which is vital. Standards need to evolve, in order to remain relevant. Even as it launches, SWIFT’s eBAM standard needs to be ready for changes likely to take place in the next few years, such as the adoption of standards for digital certification and continued changes to Know Your Customer (KYC) due diligence processes.

The corporates became early adopters because the benefits that could be generated were so clear. They wanted to be involved early in the initiative, to be able to leverage the knowledge and expertise gained in future.

The corporate participants gained the opportunity to provide critical corporate input into the direction taken by the bank, SWIFT and Wall Street Systems with the pilot. BNY Mellon took a leadership position in partnership with SWIFT and Wall Street Systems. It shared a desire to drive change, be an innovator and support the use of an industry standard – which benefits all SWIFT members – enabling it to influence the adoption of an open architecture for eBAM at its inception.

The relationship between bank and customer has become more valuable in recent years and the benefits of eBAM should allow BNY Mellon to build closer working relationships with its customers. Its participation means it will be among the first banks to roll out eBAM to other customers.

The long-term benefit of SWIFT’s participation cannot be overstated. As the eBAM standard is more widely adopted, it will become a consideration for mid-sized and smaller corporate customers. They are less likely to use the SWIFT network directly, but the argument for adopting these eBAM message standards is strong: it means they can become more integrated with SWIFT as they grow, and also helps them to remain fluid in their relationships with both banks
and software vendors.

The significance of SWIFT’s involvement is that the industry knows the standards will exist in the
long term.

Picture: Jason Grant

Whatever your position, whether you are trying to preserve or enhance existing wealth or building fresh wealth strategy is key. As the old adage goes – if you fail to prepare then you prepare to fail. Your wealth will need to serve different purposes at different times in your life, and your wealth management strategy must reflect this.

It is absolutely inarguable that you need to be clear in your goals. Only through this can you make the right choices. Strategically speaking, the investment horizon that you are working to  is one of the key things to decide upon. Regular returns may or may not be priority as well. Because you needs and circumstances change over time, you need to be aware of this.

When you break it down the concept of ‘wealth’ serves several purposes. Wealth preservation is all about maintaining the value of capital, whilst simultaneously providing a reasonably stable source of income. Wealth enhancement on the other hand is all about growing wealth at real terms,  but not risking capital to a large extent. These contrast with wealth generation, where, to use a poker analogy, you need to put more of your chips into the middle.

Coutts quote an interesting static on their investment management page: in the top 5% of US pension fund results asset allocation was responsible for 77.5% of returns. Choosing the correct composition of a portfolio is at the heart of getting the returns you would like.  Picking selection from across the spectrum of asset classes across a range of markets is good practice in investment management.

All investment carries inherent risk. Understanding an managing risk is essential to wealth management. The three main forms of risk you need to calculate are volatility risk, liquidity risk and shortfall risk. Volatility risk is the risk that in the short term  there will be large swings in asset prices – hitting portfolio value. You may not have instant access to your money at the time you need it with some investments – this is what the term liquidity risk refers to. The risk you will want too be most averse to exposure to however is shortfall risk – that the investments do not satisfy income and capital growth objectives.

Picture credit: hdptcar (Flickr)

If you have employees you have a duty to make sure that they are not injured at work. Some jobs are just more dangerous than others. Different hazards accompany different jobs though, and no workplace can ever be completely safe.  The consequences of not ensuring that the workplace you operate is safe  can be bad for your business for a number of reasons.

Time off taken by employees due to sickness and injury is expensive. Providing cover fro absence can involve costly agency staff – and the worst case scenario is that work will be held up due to staff with critical skills being absent. Illness and injury in your workforce is something you have an ability to reduce by operating a safe workplace and implementing safe patterns of working. Many employers have found that initiatives such as gym membership that promote health have helped to reduce medical absenteeism.

One aspect of having a poor track record on health and safety that is easy to overlook is that of reputation. If injuries are common and there is a perception that the workplace is a dangerous one then recruitment could become difficult. Being able to point to an excellent record of injury free working can help avoid having to pay staff an extra ‘danger money’ premium.

Litigation is also a concern. You should of course be insured, but if your insurance has to pay out to an injured employee you could see your premiums rising sharply.  This is how compensation solicitor define actionable accidents at work:

• accidents caused by poorly maintained vehicles
• lack of safety equipment
• absence of health and safety training
• failure to implement standard operating procedures
• regular risk assessments not being carried out

‘Health and safety’ gets a bad press sometimes, but all jokes aside it is something that you as an employer ignore at your peril.  There is a lot of excellent information on the HSE site – definitely worth consulting.