The United Kingdom served its Article 501 notice today, giving two years’ notice to leave the European Union. Managers of offshore funds, as well as everyone else here in the UK, now have more clarity on the Brexit timetable, with the UK scheduled to be out of the EU in March 2019. Much has been uncertain since the UK’s referendum in June last year, and that’s not likely to end until the final exit terms are agreed, but it’s clear that the effects of Brexit will be felt beyond the UK and Europe. Brexit negotiations are expected to be intense and politically complex (especially with French and German elections later in 2017 and Scotland’s demand for a further independence referendum before Brexit finally takes effect), with the UK’s stated aim, in its Article 50 notice, of agreeing a “deep and special partnership, taking in both economic and security co-operation” between the UK and EU post Brexit.
So what impact will Brexit have on offshore funds?
“We just spent the time staring at your arse in that tight cream dress, bending over the boardroom table” was the comment from a client that completely disarmed me as a newly qualified corporate lawyer. I was at a predominantly male completion dinner with some of my colleagues and a male management team, having just worked that “arse” off completing a massive management buy-out in record time, culminating in 72 hours working with no sleep.
Fortunately, during my career, explicitly sexist comments like this have been rare. But being in a room filled with men and finding it tough to break into the conversation or feeling like I am suffering from a language barrier (when everyone is actually speaking my native language) has been a common theme. I find it difficult to put my finger on what it is that I find challenging about these situations, particularly when I work well with my male colleagues and clients, and count many men as my close friends. On a social level, I hold my own with men and women alike. Kim Elsesser, business psychologist, calls this “the sex partition”. Forming new business and social relationships is easier with people who are similar to us and, generally, the same sex. “The communication is easier and more predictable, and it results in greater trust”. And, taking this further, breaking into groups of the opposite sex, particularly in a competitive, marketing environment, is even harder.
The Financial Times reported in November last year that, according to research examining over 26,000 funds across 56 countries, only one in five has a female portfolio manager, a figure which has not improved since the financial crisis and in 2015 women held only 10.3 percent of C-suite positions in the hedge fund industry. Research also shows that, despite the evidence that women-owned or women-managed hedge funds outperform the industry, women-run funds continue to find capital raising more difficult than their male peers. This has led to many asserting that women must work harder and perform better to achieve the same results.