Michel Davy, former MD of local fund administration business, Ipes – reflects on nearly ten years as
an independent non-executive director on how the market has changed over the years and what could be next…

The early days
Becoming an Independent Director at 40 years old was seen by some as a bit of gamble in a highly
competitive market dominated (then) by former senior executives post retirement from day to day
executive work and usually always men. I remember attending seminars and being the youngest in
the room by 15 years with no women present…

I was fortunate however to have seeded my portfolio of work with former clients and one or two
newer clients from various referrals in the market – many people understood that I was taking this
professional full-time committed approach and genuinely wanted to see me succeed and for that I
am very thankful.

Diversity & Corporate Governance
Since I entered the market – we have seen a lot of change both in terms of numbers of directors but also a good deal more women and younger people – many have told me that my move out of fund administration was a pathfinder for them to do something similar. The corporate governance code which was introduced a few years before by the Guernsey Financial Services Commission also helped to focus on the importance of both independence and diversity so the timing of entry into the market was perfect as administration firms and licencee’s were tasked considering the provisions of the code.

Arolla Partners
When considering how to provide my director work – it always occurred to me that I could provide
service through a more corporate offering and so myself and Sandra Platts set up Arolla Partners
(originally part of a wider Channel Islands group) in 2017 and applied for a Fiduciary Licence.
Having been licenced for 5 years and more directors having joined our platform – Arolla is now a team of eight with seven directors and an office manager for admin and compliance support. The business also offers general consultancy and board effectiveness.

Why Arolla?
People ask me all the time why provide your services through a corporate vehicle and in collaboration with others. I have to remind everyone that whilst all director appointments are personal appointments and that we do not provide corporate directorships, Arolla is cost sharing platform which provides an infrastructure to be able to do our director work more effectively, more securely and to keep up to date with best practice, It also provides all involved with a central town centre base and with like-minded colleagues. Director work can be a lonely existence so having the office and colleagues to bounce ideas off is appreciated by everyone involved.
We also have a unique helicopter view of the markets that we practice in, particularly the fund
administration and fiduciary space.

What’s next?
For the Director market – it is interesting that there are a lot of commentators suggesting that
regulating directors and the provision of the service is likely to become main-stay – In many
jurisdictions – even close to home in Jersey where a cat G licence is already required, regulating
directors and the provision of the service is expected – whilst exemption’s currently exist here under own fiduciaries law and many people currently hold personal fiduciary licences – it will be interesting to see how this may change – and how external pressures may end up forcing the issue for a more comprehensive regulatory regime with fewer exemptions.

For me - more of the same really – my portfolio is mostly concentrated in Private Equity and Real
Estate in the closed ended fund space so I continue to focus in that area – on the old adage that sticking to your core competence is key. The most challenging thing that all independent director’s have to face is that there will always issues to deal with and sometimes it can be demanding– but it’s the nature of the role and people should not enter the market if they can’t deal with that. The real rewarding aspect of what I do is that I often find myself in a senior independent director role – trying to lead and steer the board through tricky problems, some of which can take months to navigate.

To date it has been a great privilege to work with some leading private equity houses and start up
players new to Guernsey. This year alone marks 22 years of PAI partners with their funds domiciled
in Guernsey and 20-year relationship for me (both in fund administration and director work) and whilst the Guernsey based funds will finally run off this year – I continue to support PAI in Luxembourg (with Fund VI) bringing best practice on Governance to those boards. White Star Capital is another group where I have been involved in their journey since inception in 2013 – starting from an $80 million fund to now a multi fund business with nearly $1 billion of assets under management (Aum).