Singapore and Philippines are the role models in making improvement in our workforce
Interview with Ms. Maleeha Bangash, Deputy CEO – Habib Asset Management Ltd
PAGE: Tell me something about yourself and your professional achievements, please:
Maleeha Bangash: My family originally hails from Kohat, a small town in the North West of Pakistan, (now known as Khyber Pakhtunkhwa), and I was born in Kohat. My parents decided to settle in Lahore, however, since my father served in the Army, we moved often and I have lived and been raised in many cities all over Pakistan. We are five siblings and my parents raised us with a strong value system and a progressive, enlightened and above all balanced approach to life. They have taught us, above all courage — to speak the truth and lead an honest life. They instilled in us the importance of, perseverance and hard work, always believing in the goodness around us and behaving with dignity and having immense faith and optimism.
It is, without doubt, these values and the immense support and involvement of my parents that has contributed to my being where I am today. I am currently, Deputy CEO, Habib Asset Management Ltd, (the AMC of Bank AL Habib). I obtained my MBA (Investments and Finance) from University of Chicago, Booth School of Business and graduated with Honors. My son who is now 12 years of age, was also born during that time and I was considered quite a novelty, also because I was a woman from Pakistan, and some of my class mates would call me a “superwoman” since I was happily juggling so many things.
Previously, I had also obtained an MBA degree from LUMS. I now have under my belt around 18 years of varied local and international experience primarily in the areas of Asset Management, Corporate Banking and Business Strategy, in Singapore, Pakistan and Turkey. I have an entrepreneurial flair, which has aided me in setting up the offices and establishing business for the organizations I worked for. This very ability has also enabled me to strategically reposition and grow existing companies to the next level.
I had the rare opportunity of formulating the strategy, carrying out negotiations and establishing an International Franchise in Pakistan. I also had the experience of being extensively involved in the launch of the Singapore office of an International Financial Advisory firm.
In Pakistan, I have had the good fortune to have worked with top local Investment firms such as MCB AMC, UBL Fund Managers and JS Investments (all Asset Management Companies) in leadership roles.
As Chief Strategy Officer UBL Funds, I formulated their 5 year Strategy and implemented the same to take firm to the next level. One the most meaningful experience – certainly on which provided a lot of gravitas — was when I was selected to serve for the Government of Pakistan as Member/Commissioner, (Grade 21), Competition Commission of Pakistan, (CCP) when it was established.
I learnt a great deal from Mr. Khalid Mirza, who was our Chairman. In my role at CCP, I had the powers of a High Court Judge and one of the cases I had heard and passed judgement on. The Judgement Order — which was a speaking order, i.e. it contained and elaborated all the reasons and rationale within it — that I issued was instantly selected and published by the Global Competition Review as an exemplary judgment. Also, I was profiled as one of the leading women in Anti Trust internationally.
In my tenure at CCP, I was in charge of areas of Advocacy, Research and overseeing Mergers and Acquisition Review. I set up the AMFO, the Acquisitions and Mergers Facilitation Office, based upon an international precedent. The invaluable network of relationships with highest echelons of regulatory bodies, ministries and private sector leaders, established during that time still holds strong. I have always worked hard and with sincerity but I have had God‘s Grace and Help at every step of the way.
PAGE: Please tell us a bit more about your industry:
Maleeha Bangash: Investment Management/Financial Advisory industry – deals primarily with mutual funds of different categories, which invest in various asset classes for example Equities, Money Market Instruments (T Bills) and Fixed Income Instruments, (Corporate and Government Bonds). The Pakistani mutual fund industry comprises of 22 asset management companies (AMCs). There are 215 funds operating in market out of which 164 are open ended funds. The ratio to total banking deposits is 5.35% till Dec, 2014. However, in comparison with our neighboring country, India’s AUM is $178 billion, which amounts to 5% of GDP; whereas it’s GDP, is around $1,877 billion, which is about 8.08 times bigger than Pakistan’s economy. After adjusting for the size, Pakistan’s AUM should be $36 billion. Unfortunately, which is far below the current figures of $4.5 billion.
The industry has had a good growth trajectory, starting with a mere 22 billion in the year 2000 growing all the way to 459 billion in 2014. The total size of assets under management (AUM) in Pakistan is approximately or $4.5 billion, which is 2.09% (approx.) of GDP (FY14).
This growth has continued and the industry is around Rs493.13 billion (Feb 2015), but there is still a lot of awareness to be created about mutual funds and their benefits, especially in the retail segment and the peripheral cities and towns of Pakistan.
I joined the local industry in end 2006 (before that, I was working in the Asset Management Industry in Singapore at which time it was still a nascent industry. I am glad to have been an active member of Professional Committees of MUFAP (Mutual Funds Association of Pakistan) viz.,Technical Committee, Rules and Regulations Committee, Marketing and Awareness Committee, Publications Committee, Taxation and Audit Committee, Voluntary Pension Scheme — contributing to the development and evolution of the Mutual Fund Industry.
I also author and regularly contribute articles, to various business/financial publications on an ongoing basis.
PAGE: How would you comment on the human resource in Pakistan?
Maleeha Bangash: Well to my mind it is very clear… Human Resource or Human Capital is the greatest wealth we have in our country. I remember when I was at the Booth School at, University of Chicago, I had a long after class discussion with our Macro Economics Professor, about how this is the greatest strength of our economy, which is largely untapped…and it is this Human Capital, not really the agricultural produce and agri based industry that we generally believe is what can drive our economy. Today I am a strong proponent of Human Capital development and gender inclusion in the workforce. Our Quaid-e-Azam said, “I have always maintained that no nation can ever be worthy of its existence that cannot take its women along with men. No struggle can ever succeed without women participating side by side with men. There are two powers in the world. One is the sword and the other the pen. However there is a third power stronger than both, that of the women.” It is not a coincidence that the Pakistani’s abroad rank amongst the best and most hardworking, productive white collar and blue collar workers (given their level of education and vocational training).
There is no dearth of talent in Pakistan merely a lack of vocational training, education. The skill levels remain low, despite the fact that there are increasing opportunities in the service industries, e.g. jobs such as administrative staff, nursing staff, care givers, primary teachers, banking officers, customer service and retail outlet staff and so on. There is no real drive to train persons who can fill these jobs opportunities.
PAGE: Do you think we need more skilled individuals to progress further?
Maleeha Bangash: Absolutely. I have lived and worked for around 6 years in Singapore and I was truly amazed by how much progress that miniscule country (a red dot as it is fondly called) has achieved primarily through its focus on Human Capital and a skilled and educated workforce. I believe we need a similar model here, where our primarily focus should be on educating and developing our teeming millions. I am not naïve I do understand the complexities that our country faces are much greater than that of Singapore. However, I strongly believe that it can be taken as a model to emulate. There are similarities for example, till as late as the 70’s, there was ethnic strife in Singapore, however, today several ethnic communities coexist and have integrated , with great tolerance and acceptance of each other. I am a great admirer, of Mr. Lee Kwan Yew, a great luminary and leader, who literally built up their nation. On a separate but to my mind related note, to achieve the kind of progress and enlightenment that is required our Nation building activities must increase, and only when we start thinking as Nation will we move forward. The onus does not just lie with our leaders, but also with us — each one of us — because we also have responsibility to change our own mindset, that of those whose lives we and thinking we can influence such a s our children, our loved ones, friends, neighbours and communities. We ourselves need to open our minds to take our country to that level. Exhibiting tolerance and acceptance of each other and thinking of ourselves as Pakistanis first is a key element to get a patriotic and progressive mindset.
PAGE: Which sectors of economy have benefited from the skilled workforce in Pakistan:
Maleeha Bangash: Primarily the manufacturing and construction sectors. In a survey conducted by Pakistan Bureau of Statistics (labor force survey) from 2012-2013 (fig. 12.5 A), the total participation rate of skilled workforce in economy is relatively low in manufacturing & service sectors, whereas, agricultural sector constitutes the largest share of employment. The wholesale and retail trade sectors do not provide better employment opportunities to skilled manpower. The community/social and personal services sector comprises various subsectors; overall the share of skilled workforce employment has increased from 11.2 percent in 2009-10 to 13.3 percent in 2012-13. According to PBS, major portion (44%) of our Human Capital in Pakistan, is employed in the agricultural sector — this means mainly semi & unskilled labour. So, there is a great need to bring the percentage of skilled labor higher and thus increase productivity across the sectors, through effective measures of promoting education, vocational trainings, literacy programs, apprenticeships etc.
PAGE: How would you comment on overseas Pakistanis and their contribution through remittances?
Maleeha Bangash: The contribution of oversees Pakistanis has been tremendous; first and foremost in terms of real foreign exchange reserve impact, even during recessionary periods in the economy. Secondly, the impact on the economy and the prices of assets such as real estate. Empirically, the larger part of the flow of remittances received in the economy is consumed by the construction industry, as the overseas workers build their houses, shops and other buildings in the home country. The construction industry is linked to 35 other industries, including cement, iron, glass, wood and paint. When the overseas workers allocate much of their earnings to housing construction, each of these industries grow as a result. Thirdly, the fact that they will remain a conduit or connection for Pakistanis to find jobs or business opportunities abroad. During the last several years, overseas Pakistanis contributed $55 billion to Pakistan whereas the International Monetary Fund (IMF) has only given $6 billion in financial assistance to the country. It has been projected officially that the overseas worker may contribute $14 billion by the end of this year against $13 billion in remittances from the preceding year. The government can encourage the financial sector to create remittance based products both in banking & mutual fund/ investment management side. Perhaps, the government can also launch its own savings schemes targeted at overseas Pakistanis (Non Resident Pakistanis). If we learn from, South East Asian countries, significantly Philippines, who have developed their Human Capital and their skilled workforce is now employed all over the world, in the manufacturing and service sectors in the form of executives, nursing staff, I.T professionals, technicians etc. Through these expat workers contribution in the form of remittances their economy has benefitted. Similarly, we need to invest in our skilled workforce and they can contribute in multiples of what they are doing right now.
PAGE: Your views on Pakistan economy:
Maleeha Bangash: The economy today is undoubtedly passing a challenging period. Continued power and gas shortages, lower cotton and edible oil prices, and a weak external demand for some products such as cotton yarn and cloth and cement are likely to contain growth in large-scale manufacturing, I am not a macro economist, however, according to me the positive factors right now are low global oil prices & a foreseeable improvement in socio-political stability, which is essential for creating the enabling environment for businesses to flourish. Pakistan’s economic growth has not been driven by competitiveness, efficiencies and diversification of manufacturing and it has evolved from agriculture to largely low productivity services. According to ADB, Pakistan’s economic growth in 2015 is projected to modestly improve to 4.2 percent and to 4.5 percent in 2016. I believe greater strategic focus is required for establishing high value-addition manufacturing & services sectors, & enhancing industrial and export competitiveness through better investment climate and trade policy reforms is critical for stable external account and growth.