Asia can be a global fintech leader and disruptor, says RSM Malaysia partner
Government mentoring and support are critical in engaging regional fintech startups.
Hoe Yin is a partner of RSM Malaysia who had accumulated vast experience in the audit of small and medium-sized, publicly listed, and multinational companies in major industries such as retail and consumer markets, real estate investment trust, oil and gas, telecommunication, pharmaceutical and health-care, construction, hotels and resorts, multimedia, information technology, trading and distribution, manufacturing, plantations and investment holdings, amongst others.
Hoe Yin also leads RSM Malaysia’s Transactions Advisory service, focusing on financial due diligence, review of post-closing completion accounts, and post-acquisition support for integration and dispute. He actively advises clients during the acquisition process, and the pre-closing and post-closing stage, primarily in middle market transactions. Hoe Yin is also involved in the coordination and execution of cross-border transactions, for both buy-side and sell-side clients.
Proficient in both English and Mandarin, Hoe Yin is currently the Country Leader of the China Practice Group in RSM Malaysia.
In judging the entries of the Malaysia Management Excellence Awards, Hoe Yin revealed that his key criteria included the candidate’s ability to sustain customer service and product delivery while ensuring employee wellbeing, as well as the ability to reinvent and reposition oneself in today’s circumstances, without forgetting its CSR role towards the community.
In your career, what were the most valuable experiences that contributed to your success?
I have a strong belief in the Confucius saying of “三人行， 必有我师焉” - there is always something to learn from everyone, and I regard the people that I have crossed-paths throughout my career as valuable “teachers” who have shaped me through my experience dealing with or working with them. I have learned considerably from great people; and what not to do or how not to act from the opposite.
Further to that, various work assignments and the different roles I have played and participated at different stages of my career have given me valuable experiences. Such opportunities have really helped me broaden my capabilities in general.
What do you think are the skills and values that will be relevant to future audit, accounting and finance professionals?
Continued globalisation made businesses expand into sizes and structures where no one expects in the past, thus in the process of financial reporting and auditing, communication and project management become crucial skills that the professionals should have on top of technical accounting.
Traditional skills such as professional skepticisms, the ability to exercise professional judgments, analysis and understanding of technical accounting remained important because these are very critical skills in a data-governed world.
Future audit, accounting, and finance professionals should possess the skills to work with big data through analytics, where they should have the ability to implement automation processes to translate the data in a way that complements their work, on top of their proficiency in statistics, probability and deductive reasoning.
With the ever-changing environment, future audit, accounting, and finance professionals need to be able to open up their minds to learn and adapt to changes proactively, so as to remain relevant.
Having said all of the above, I strongly believe that integrity and honesty remain to be the fundamental value to audit, accounting, and finance professionals. This is a value that will never be obsolete, to uphold the pride and dignity of the profession.
How can the education system transform to support the success of these future finance professionals?
With the fast-paced development in the world and the rapid changes in how economic activities take place, the education system needs to evolve accordingly for the finance profession to stay relevant. In my view, the syllabus has to be updated in line with development in the world and it has to be more practical and pragmatic according to the needs of the industry. Some of the areas of focus would be those that I have mentioned in the earlier question.
The ideal education system should empower students to think critically; students should be able to apply knowledge learned to issues or circumstances when solving problems. An education system that focuses on rote-learning or passive-learning will lead to a generation of finance professionals who are less innovative and who fail to think outside of the box - thus becoming irrelevant.
I think the education system should also take Continuing Professional Development (“CPD”) as part of something more permanent. With the fluidity of current legislation and business dynamics, there is a constant need for accounting and finance professionals to continue to pursue personal growth, beyond the training that was inculcated into them during university.
Credibility is key when working as a finance professional and my view is that it is equally important to focus on and reinforce the right values when educating future finance professionals. Integrity and honesty are values that are core to the profession and should be upheld regardless of the pace at which the world moves or has changed.
At the end of the day, the profession will have no future without its credibility and confidence from the public at large.
A lot of digital disruptions in the finance industry originated from and were conceptualized by Western companies. What must Asia do to be on par with these global fintech leaders and disruptors?
Yes, there has been a great deal of digital disruptions in the finance industry which originated from and were conceptualized by Western companies. However, in recent years, Asia is catching up with these global fintech leaders and disruptors. In fact, Singapore is listed as being in the 4th spot in the 2021 Global Fintech Rankings and has been within the Top 5 spots globally since 2016. This was a result of its vision to be the world’s first “smart nation” by 2030, using technology to improve the economy and enhance the standard of living.
I think governmental and authority support is crucial and I got to quote Singapore again, where the government and authority engage in fintech startups by mentoring and working with them. The effects of such moves are visible to all with what Singapore has achieved so far.
The Singaporean government had also recognised the needs in the development of the talent pool thus have responded to it by strengthening the talent pipeline with relevant skills through education. Various upskill and skill conversion initiatives have enabled Singapore to have a strong pool of talent to ensure the fintech ecosystem continues to flourish.
Asian countries can definitely take Singapore as their role model in this aspect.
As a judge in this award, what judging criterion carries the most weight and why?
My judging criterion would be on how the candidates have responded through the pandemic, by looking at the efforts and initiatives that made a positive impact on the organisation and its stakeholders, which includes the employee and community at large.
I would see the pandemic itself as a test to the organisation and its management, on how the organisation remained sustainable, to continue to provide the best products/ services to their customers/clients without sacrificing the welfare of its employees and still being able to play its CSR role towards the community. How the organisation and its management continue to motivate its employees to respond positively during difficult times and continue to provide the best products/ services to their customers/ clients would be an area I would also like to learn from the esteemed candidates.
The ability to reinvent and reposition oneself in today’s world based on current circumstances is crucial for an entity’s long-term sustainability. This may sound cliché however, I would like to reiterate that in the modern world we live in today, change is the only constant.
All sizes of companies certainly felt the impact of the Covid19, especially small and medium-size enterprises (SME). How can SMEs recover from the financial downturn in the next few years?
Digitalisation and the adoption of new technologies have been the most spoken strategies for post-pandemic recovery. In fact, this has been a strategy that kept many organisations afloat during the height of the pandemic. Many SMEs had responded to the crisis and minimise disruption to business activities through digitalisation and technology, and this is expected to be the way forward. There is a fundamental need for SMEs to change their businesses to online platforms as the unprecedented lockdown measures have fundamentally altered consumer expectations.
SMEs will need to review business operating models and modify the business operations to ensure sustainability, by improving the efficiencies, in terms of production capacity and costs. In the new norm, businesses can no longer be done alone. One of the keys to sustainability will be “leveraging”, where businesses come together to improve the effectiveness and efficiencies along the value chain, through collaboration, or M&A, so as to become more competitive in the market.
SMEs are typically more financially fragile and have smaller cash buffers than their larger counterparts. This makes them less resilient to crises. In addition, SMEs find it harder to tap into different sources of finance, including from the market and are often very reliant on retained earnings and traditional bank debt. To overcome this, SMEs should pay attention to their cash flow and credit risk management to avoid them from getting into any potential liquidity crises.
Products/ services development to open up new sources of revenue or at least ensure that there is still demand for their products and services. While I do agree that it is important to control and minimise costs and expenditure, but to remain sustainable in the long run, it is the profitable revenue sources that keep the SMEs or any businesses in the play. The 2,000 year old (at least) Chinese saying of “开源节流” - Broaden sources and control outflow; had always suggested that we should broaden our sources of income first while looking for ways to control our costs and expenses, and not the other way round.
To your knowledge, how far have Asia-based finance companies and banks adopted, organised, and optimised Big Data to improve customer service?
In recent years, the shift of the economic powerhouse from the West to the East, reflects not only the increasingly central role of diverse Asian economies in global trade and economic growth but also Asia’s renewed leadership in scaling innovative technologies and new business models. The emerging markets of Asia have become a major engine of growth in global banking. The use of Big Data analytics across the Asian region to solve a variety of business problems and other challenges has been growing and is expected to accelerate amid the pandemic.
The nature of financial companies and banks involves generating and processing huge amounts of data. Hence, finance companies and banks have been the keenest adopters of data analytics and will remain so, as it finds ways to unlock the value of the data in its possession.
Banks know that unlocking the value in those data could help set them apart from the competition. According to technology research firm IDC, spending on Big Data technology in banking and financial services is expected to grow at a compound annual growth rate of 15.6% from 2019 to 2024.
Banks in Asia had adopted, organised, and optimised Big Data via data analytics to:
▪ Data-mine the customers wants and needs to understand the buying, spending, and repayment patterns of their customers, so as to cross-sell and offer individualised products or services that best suit their customers’ needs;
▪ Enhance the security features of their products or services, by being able to track any unusual spending and repayment patterns or locations where transactions have taken place through the algorithms created using Big Data;
▪ Improve operational efficiency and in response to the Covid-19 pandemic, where an example I would quote is how Indonesia’s Bank Mandiri used its Big Data platform to determine which branches should remain operational and gave that information to customers and government’s financial services authority.
I believe we will see more innovative ideas in the use of Big Data by the banks, in response to the more intense competition, which ultimately should improve customer experiences.