China – make it your oyster

Recently, I visited our UBS offices in China. It was an extremely insightful trip – and lately I've been thinking about our increasing presence in China and how my Chief Operating Officer team contributes to this strategy. Here's what's been going through my mind…

China is expected to become the world's leading economy by 2022, with tremendous potential for growth, development and business opportunity. And recently, a lot has changed in terms of doing business there. For example, historically, foreign firms were restricted to minority stakes in domestic financial institutions. Just this year, UBS became the first foreign bank to apply to increase its stake in a local securities joint venture – in our case, UBS Securities Co., Ltd – to 51%.

Our global business strategy emphasizes further investments in China. In 2016 we had around 600 employees in China, and we plan to double that to 1,200 by 2020 to support projected regional business growth and to provide internal services on a global basis. Let me tell you a little more about three of our investment priorities:

People

When we talk about banking, it is important to remember that banking is people. People are our only real asset, and it's mutually beneficial for us to invest in talent in China. Human Resources is part of the function that I’m leading, the Group Chief Operating Office. And, as such, we are very much at the heart of sourcing great talent. We have an opportunity to develop and employ the people we need to grow our businesses in the midst of an ongoing war for talent. We are doing this by tapping into highly qualified local resources. For example, 98% of our China workforce in the Business Solutions Center (BSC) has a bachelor's degree or higher, and 56% have studied overseas (which is particularly valuable for a global firm like UBS). Furthermore, our employees there are highly engaged in corporate social responsibility and volunteering initiatives – a win for local communities and for building collaboration within the company.

Our global business strategy emphasizes further investments in China.

Proximity

In China, UBS has presence across Beijing, Shanghai, Guangzhou and Shenzhen, and opened a UBS Business Solutions Center (BSC) in Wuxi. Perhaps Wuxi comes as a little bit of a surprise, as it's not known as a financial hub. But increasing our presence in Wuxi was a strategic decision, due to the available talent and also as it's only 130 km away from Shanghai and a 2.5 hour flight to Beijing. That puts Wuxi right in the middle and this proximity allows my team to support our local businesses in China, as well as those in the rest of Asia Pacific, ensuring that our regional clients are well served at all times. And it speaks to the second part of our China strategy: staying aligned with our businesses and close to Beijing and China's domestic markets (and especially with the Chinese government and regulators) because this is key for growing our revenues and ensuring our long-term success in the region.

We have an opportunity to develop and employ the people we need to grow our businesses.

Possibilities

The world is your oyster – and the same could be said about fast-growing Wuxi. It's one of China’s top 10 cities for investment and economic vitality and has been designated a China Service Outsourcing Talent Training Centre by the Ministry of Commerce and Ministry of Education. And, we’re seeing Wuxi become one of our key centers for automation and robotics innovation. An example: since opening our Wuxi BSC in 2016, we've built and deployed 29 robots, with 30 new ones in the pipeline, enabling us to provide high quality 24-7 services to internal stakeholders globally, at a lower cost than traditional services. And why is that relevant? This supports our strategy – to offer clients as well as our internal stakeholders the best service. But not only in Wuxi. In Shanghai we have put a special focus on Fintech, where we have a dedicated team serving our global Investment Bank and local business areas. They've introduced algorithmic trading solutions which have been widely used in APAC.

Clearly, China is (and will continue to be) a key part of our global strategy. But it's not just a strategic location for us in the financial sector. Well educated, motivated people, close proximity to the business, and possibility (in terms of technological innovation) are keys to long-term success for any business, and they're all up-and-coming factors for doing business in China.