Unseen, Be Seen or Obscene?

A few of you have had March 26-28 blocked off in your calender. It is the annual rugby 7's tournament in Hong Kong. More correctly, it is the Cathay Pacific Credit Suisse Hong Kong Sevens.

This raises an interesting debate on corporate sponsorships. If you were retrenched or didn't get a raise/bonus, or were given the mandate to slash another 20% off your expense budget by CS or CX for cost savings, then this event is just adding fuel to the fire of discontent. If you're a patron, then you should know that the millions spent here will be re-couped by fees that you end up paying.

Does a bunch of intoxicated, cross-dressing, painted men and ladies do much for business? Does a marathon bring in business for Standard Chartered Bank? Does a golf tournament help UBS? The answer for those who green-light these sponsorships, the answer is yes. For the rest of the world the answer is maybe.

The obvious, yet very intangible, benefit is exposure. You get your logo and name plastered on everything and often mentioned in every news article. Do you believe the ad companies when they tell you that a good (and expensive) ad campaign will increase inquiries/business by X%?

What often remains out of sight are all the meetings, private parties and re-connections that coincide with these events. Here's where the big payoff usually is. People are calling clients, prospects, business heads and movers & shakers with event ticketing/guest offers (and although you wonder why they couldn't call out of the blue anyway), the guise/lure of tickets often does lead to fruitful discussions. So getting face-to-face time is far more important than a casual observer might think.

Clients in Asia are rather passive. The majority, even those who know they have a need, like or prefer to be approached, wooed and pitched. There's almost a loss of "face" if they call you up. There are usually events where they get to parade their front line staff in front of you, hoping that you will keep a name card or that some chit-chat could blossom into a business relationship. If you're the invitee, then you are a piece of meat. If you are the host, then you are the spider asking the fly to walk into your parlour.

But now we need factor in another consideration when we deal with private wealth, particularly trust/estate/succession planning, which is secrecy. Yes, that nasty word that is becoming cancerous to private banking. Asians are particularly secretive. They don't like their friends, employees, family, spouses or children to know everything. They don't like their advisors or bankers or trustees to know everything. The wealthy are very cognizant to the point of paranoia that it very easy to lose everything (or a lot) if over-exposed. In Asia, a wealthy family may be have had direct experience in everything from war, communist expropriation, coups and revolutions, race crimes, kidnap and ransom, thieving relatives, blackmail syndicates, corrupt governments, dodgy businesses, organised crime to tabloid expo-says. Of course some of your clients are not the victims but the instigators.

Ever wonder why the typical Asian private bank client has 3-6 relationships? I dare say only about 10-15% of the Asian cases I work on are totally transparent. In the others, there are usually instructions or wishes that certain parties be kept in the dark about the trust or its terms until it becomes relevant. This could be everyone from their own lawyers, to their accountant, to their bankers to trust beneficiaries. People simply do not want you to be able to connect-the-dots. It usually not until estate administration that things start coming to the surface, if they ever do.

Not all secrecy is "bad". There was a extremely nice housewife I once worked with who inherited a small fortune from her husband. [It brings back sweet memories of her youngest daughter, about 3 at the time, bringing in crayons and drawing on trust documents while we adults talked business]. She had secretly set up trusts for her young children for no other reason than to be able to live a rather middle-class life where she could instill the value of a good education and hard work upon her kids. Her greatest fear was producing an aimless, spendthrift trust fund kid a la Paris Hilton.

Some view us trustees (and private bankers) as people that should be heard but not seen, kept hidden away like some mistress that no one knows about. How many of our clients refuse to come into the office or request we meet in their homes or in some hotel room (and not lobby or restaurant)? Do we turn up at these corporate functions? Do we shake their hand and pose with them for the photographer from the Asia Tatler? Sometimes the reception is cordial, sometimes inquisitive, sometimes you get the cold shoulder and sometimes you are avoided like a STD/VD doctor.

So do these corporate events help the wealth business? I think the direct impact is minor. At best you get them to open a crack in the door. What you do with that little opening is anyone's guess. Some turn it into a major business opportunity, others let it close.

Excuse me.....time to go put on my make-up and Marilyn Monroe dress.