FATF invites STEP to discuss potential revision of Recommendation 25

The Financial Action Task Force (FATF) is conducting a review of Recommendation 25, which covers the transparency and beneficial ownership of legal arrangements. The FATF’s objective is to improve Recommendation 25 and its Interpretive Note to meet its overall objective of preventing the misuse of legal arrangements for money laundering or terrorist financing.

The FATF recently invited STEP and other stakeholders to attend a private sector engagement forum in early November to understand their views on several key areas.

The forum participants discussed the definition of trusts and equivalent legal arrangements in common/civil law systems. The discussion focused on whether a common definition could be introduced in order to clarify where the law is unclear.

This section also covered the key challenges of understanding the nature and structure of common law express trusts and civil law legal arrangements.

The key challenges in understanding and verifying beneficial owners in the context of trusts, and how the concepts of ‘ownership’ and ‘control’ would apply to them, were also discussed. The types of information collected to establish beneficial ownership of trusts, and the challenges of collecting this information of foreign legal arrangements operating in countries without the necessary legal framework, were also covered.

The FATF also raised how it wished to establish to what degree identification of beneficial owners should be inherently part of a trustee’s duties and asked whether this should be an explicit obligation.

One of the major focuses of the forum was to examine some of the ways that trusts and other legal arrangements can purposely be used to disguise ownership and evade transparency. Discussion also focused on complex ownership structures and how they could be defined and identified more clearly. Challenges can arise in existing multi-layered structures where the legal entity being identified is lower down the chain of ownership and in some cases, verifying the beneficial ownership of the ultimate holding entity, can be unclear.

The FATF stated that it would welcome any written proposals with suggested amendments for Recommendation 25 until the end of the year. The next step would be a planned public consultation in Q3 2022: however, this will be open to change if necessary.

In parallel with this review of Recommendation 25, the FATF are also reviewing amendments to Recommendation 24, which focuses on the transparency and beneficial ownership of legal persons. The FATF is consulting on suggested amendments to Recommendation 24 and STEP is planning on responding.

Robert Carington is Policy Executive at STEP

Creating ‘Corporate Athletes’ with STEP’s Employer Partnership Programme

12 November 2021

What can professionals learn from the mindset of elite athletes? That was the theme of the recent webinar for STEP’s Employer Partnership Programme (EPP) members. We heard from former Olympian, Sandrine Mainville, of Canadian law firm Borden Ladner Gervais (BLG) and Sindy Peixoto, National Director, Talent Development for BLG about what it takes to be a ‘corporate athlete’. Sandrine won a bronze medal in the 2016 Olympics in the freestyle 4×100-metre relay with her teammates.

BLG runs a development programme that focuses on how to develop ‘corporate athletes’ by helping staff to sustain higher performance in the face of pressure and change. Sindy noted that to achieve long-term high performance, staff need to focus on the ‘performance pyramid’: emotions, body and spirit. 

A key theme was the need for recovery and to renew energy levels every day – not just at the weekend or on holiday. Sindy viewed sleep as ‘passive recovery’ and focused on the importance of regular concrete action to recover (e.g. stretching, plenty of fluids, good nutrition and regular exercise). She also stressed the importance of pushing beyond your comfort zone to improve.

Sindy went on to outline the traits of a champion:

  • self-confidence;
  • strong sense of motivation;
  • natural goal setting;
  • self-discipline;
  • sense of belonging;
  • ability to manage stress;
  • strong sense of focus; and
  • perfectionism.

Sandrine commented that self-discipline only works if we believe in what we are doing. She got up at 04:30 to train because she had clear goals. The key is to find the ‘why’ in what we do to make hard work become easy and natural.

The smallest gains can lead an Olympian to triumph but making those gains means putting in extra work every day for years. You also need a willingness to drive yourself harder at the end of a project, as Olympians do for their races. 

Sindy went on to discuss the importance of self-confidence, which is:

  • a feeling, not a thought;
  • based on past experience;
  • built from positive experience; and
  • comes from within.

If you don’t know how you will win/succeed then you won’t! Sandrine commented that building self-confidence is a journey that takes years and is linked to the quality of your work. You need to trust yourself and your abilities. If you give your best, and can say with confidence that you did so, then it’s not the end of the world if you don’t succeed – at least you tried! When you’re feeling down, take a rest and recover.

Sindy then presented strategies to build, maintain and regain confidence. Sindy and Sandrine both discussed the power of visualisation. This mental rehearsal, in which you engage all your senses, is a hugely effective way of improving your performance and reducing stress.

We then discussed motivation. To achieve our best, we need motivation and commitment. Motivation and self-discipline were nothing without a concrete goal. Sandrine strove for years to be picked for the 2016 Olympic team. Once she was, she had to establish a new goal very quickly. A chat from her coach, giving her examples and statistics, was a great boost for her motivation in achieving her new goal of winning an Olympic medal.   

Next, we looked at controlling what could be controlled and letting go of the rest. It’s critical to train yourself to manage your inner state and rebound from failure. Sindy noted that you must:

  • pay attention to your thoughts and feelings;
  • focus on the present; and
  • take action for change by setting some achievable goals to get started.

Finally, we looked at energy management. According to Sindy, we need to concentrate on the four key elements contained in the performance pyramid:

  1. Physical energy – fuelling the fire
  2. Emotional energy – transforming threat into challenge
  3. Mental energy – appropriate focus and realistic optimism
  4. Spiritual energy – ‘he who has a why to live’

Sindy noted that long hours take their toll. It’s important that we constantly feed our body, emotions, mind and spirit. We can underpin this self-care by setting up rituals: intentional, scheduled behaviours. It’s also important that we vary our activities – perhaps working for bursts of 90–120 minutes before taking a break (known as an ‘ultradian sprint’).

Self-care is not selfish: you are also doing it for your family and job. Distractions can increase the time we take to complete tasks by as much as 25 per cent. A lack of energy undermines productivity and focus.

Sandrine summed up with the following recommendations.

  • It’s important to maintain a good headspace. She recommends scheduling everything into our diaries that we want to do, not just meetings. Taking time for such activities gives her a clear shift in energy.
  • Failure is key to building resilience and emotional strength. A combination of hard work and learning from your failures leads you to success.
  • Learn to look at the big picture. Failure is part of a process, not the end of the world!
  • Remember that you are working for yourself before anything else. Look after yourself so that you can give of your best.

To find out more about becoming an Employer Partner, please email:[email protected]

Jenni Hutchinson, Head of Employer Partnerships

STEP Council Election Results 2021

We are delighted to publish the result of this year’s STEP Council elections. All candidates are thanked for standing in these elections, whether elected this time, or not elected, we appreciate the members who put themselves forward as nominees. We also thank those electoral college members who voted in the STEP Hong Kong and STEP Caribbean and Latin America Council constituency ballots, as well as all of the members who acted as supporters of nominations.

The successful candidates below take up their seats for the new session of Council on 1 January 2022, for a term of three years:

Australasia
Rodney Luker TEP, STEP South Australia: re-elected uncontested.

Canada
Pamela Cross, TEP, STEP Ottawa. Pamela replaces Nancy Golding QC TEP, STEP Calgary, who retires from this Council seat on 31 December 2021.

Caribbean and Latin America
Theo Burrows TEP, STEP Bahamas, who was elected following a contested election. The current incumbent, Ivan Hooper TEP, STEP South America, will now retire on 31 December 2021.

Continental Europe, excluding Switzerland
Maurizio Cohen TEP, STEP Monaco: re-elected unopposed.

Hong Kong
Michael Olesnicky TEP, STEP Hong Kong, who was elected following a contested election. Michael takes up his seat following the retirement of current incumbent Jacqueline Loh TEP, STEP Hong Kong on 31 December 2021.

England and Wales – Midlands
Laura Banks TEP, STEP Birmingham: Laura is re-elected unopposed.

England and Wales – North East
Amanda Simmonds TEP, STEP Yorkshire: re-elected unopposed.

England & Wales – Wales & West
Denese Molyneux TEP, STEP West of England: re-elected unopposed.

Guernsey
Rupert Morris TEP, STEP Guernsey: re-elected following a contested election.

You can find out more about how STEP is looking at how best to ensure that equality, diversity and inclusion are part of our governance in this blog from STEP’s Chief Executive, Mark Walley. Further details about STEP’s Council and how the organisation is run are available via the main STEP website.

Zoe Willenbrock, Governance Manager