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P. Markou: To establish a National Financial Services Authority

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This year marks 65 years of continuous presence in Cyprus since Chrysanthou & Christoforou was founded in 1958

Π. Μàρκου: Να θεσπιστε Εθνικor Αρχor Χρηματοοικονομικ ν Υπηρεσιν

In recent years, Cyprus and more specifically the professional services sector have suffered a huge blow, says the CEO of Deloitte.

Π. Μàρκου: Να θεσ πιστεi Εθνικor Αρχor Χρηματοοικ&omicron ;νομικων Υπηρεσιων

By Panagiotis Rougalas

Deloitte Cyprus has completed 65 years of presence on the island, playing a major role in the economic activities of the state. Its 65th year finds it at a pivotal point for the professional services sector experiencing world-historic changes, amid wars, pandemics and revelations about the Sector as a whole, yet Deloitte Cyprus reports high gross revenues of €51.1 million for the fiscal year 2023.

The contribution of Deloitte Cyprus to the state revenue amounts to 16.5 million euros for the current year and at its “helm” is Mr. Pieris Markou. The CEO of Deloitte Cyprus speaks in an interview with “K” about the latest disclosures by the “consortium” of ICIJ journalists, “Cyprus Confidential”, gives his opinion on the character that a Single Supervisory Authority should have and gives a “taste” for the next moves of Deloitte Cyprus in terms of services offered.

Mr. Markou in the interview he gives feels proud to be the head of the business that was founded in 1958 as a small audit office and has grown today into one of the largest service companies in Cyprus.

– To what extent do you think that the latest publication of “Cyprus Confidential” has affected the image of Cyprus?

– In recent years, Cyprus and more specifically the professional services sector have suffered a huge blow starting with the pandemic, the war in Ukraine, the inflationary pressures, and now the conflict in Israel. At the same time, we had the discrediting of the Passport program, and the various evaluations on issues of corruption and transparency, which unfortunately Cyprus remains at low levels.

Certainly the latest publications of the ICIJ with “Cyprus Confidential” do not help all the efforts made both by the Government, the various agencies and the private sector regarding our industry, which in my opinion are making a huge effort to restore of the perception that exists about our country. I believe that we have a lot to do, and what is important is to bring together “our house” as a country and to highlight this through communication. To take these actions and changes that will highlight our country, such as the establishment of a new, independent national financial services authority, the passing of the law for the control of foreign direct investments on the basis of the European Union Directive “Foreign Direct Investment Screening Directive' to give some examples, but there are many more.

– Have you felt any vibrations yet? Answer me from the perspective of the CEOof Deloitteand as a member of the Board and former President of SELK.

– As Deloitte, we are not concerned about this development beyond the impact on the general image of Cyprus and how this may affect the decisions of foreign investors and how they use Cyprus in their strategic investments. As Deloitte, since the start of the war in Ukraine and with the support of our international network, we have implemented a “pens down” policy, which essentially meant “stop any work you are doing for the client”, and this was done for any client that had connection either with operations in Russia or were of Russian interests. At the same time, a detailed “consultation” took place in order to make a decision whether or not to continue serving the relevant client based on very strict criteria defined by Deloitte worldwide.

As a member of the Council and former President of SELK, I believe that we have taken and are taking all the necessary measures required by law as the competent supervisory authority. More specifically, SELK is and remains consistent in its obligations by issuing relevant Directives and guidelines, supervising the implementation of the provisions of the Law and the Sanctions Directive, imposing punitive/corrective measures of an administrative nature against its members where the obligations of the obliged entities, reporting to the police based on article 6 of the Sanctions Law where applicable and the appropriate training of its members do not apply.

Π. Μàρκου: Να θεσ πιστεi Εθνικor Αρχor Χρηματοοικ&omicron ;νομικων Υπηρεσιων

The 14 points

– Do you agree with the creation of a Supervisory Authority that is being discussed? What form do you think it should take?

– Taking into account the changes taking place on the international scene, as well as the burden that Cyprus carries in relation to its reputation, we firstly support the Government's proposal for the adoption of a single authority to supervise the implementation of sanctions. Having studied the matter more thoroughly and looking at the practices of other countries, more advanced than Cyprus, in the financial sector, we submitted to the Government the suggestion that the State study the possibility of adopting a horizontal over-covering mechanism for the entire financial sector, for the purpose of supervising such matters as they concern money laundering legislation as well as the application of sanctions. To this end, we propose to establish a new, independent national financial services authority (of the Financial Services Authority type), which will have under its responsibility, among others, the following 14 functions/competencies.

First, the introduction and amendment of relevant anti-money laundering legislation, sanctions and other related areas. Second, to act as a direct point of contact for external authorities, international rating agencies, the press and other organizations. Third, to coordinate international assessments (eg Moneyval, IMF, EU, OECD). Fourth, to have the preparation of the National Risk Assessment project for the country. Fifth, to proceed with the integration of EU Directives and Regulations. in domestic law. Sixth, to have all sectoral supervisors comply with the law and their responsibilities as regulators. Seventh, to have in its arsenal the application of the most modern risk assessment systems, relevant typologies and standards. Eighth, to be able to encourage individual authorities to implement similar monitoring and disciplinary procedures. Ninth, to have the coordination, guidance and assistance provided to the sectoral supervisory authorities. Tenth, to be able to provide clarifications and explanations on difficult areas in relation to those related to sanctions and anti-money laundering. Eleventh, to have the responsibility of receiving and evaluating potential complaints submitted against financial services businesses. Twelfth, to control and impose measures on businesses that do not comply with the required obligations. Thirteenth, to proceed with the investigation of problematic cases and the possibility of initiating criminal prosecution ex officio, where this is justified. Fourteenth, to instill confidence and credibility in foreign investors and in international authorities.

With our recommendations, all individual supervisory authorities will continue to carry out their responsibilities as they do today (ie licensing and supervision of the entities controlled under them), but they will have a central coordinating and central body to which they will address.

65 years of presence

– Deloitte is celebrating 65 years in Cyprus and finds you at the helm. How do you feel?

– This year we complete 65 years of dynamic and continuous presence since Chrysanthou & Christoforou in 1958 and evolved into today's Deloitte. I am proud to be at the helm of this business which was founded in 1958 as a small audit office, by Mr. Christodoulos Chrysanthous and Mr. Michalakis Christoforou, two young visionaries, and has grown today into one of the largest service companies in Cyprus. But it is more important to recognize that this success is mainly due to the people of Deloitte who work diligently every day to offer our services with the professionalism and ethos that have always described our company.

When the company was founded in 1958, it had as its main focus the provision of high quality services with ethics and integrity. Despite the fact that Deloitte has multiplied in size and evolved into a truly multidimensional professional services organization, it has always managed to maintain the same values ​​and legacies of its founders, namely ethics, integrity and quality.

Π. Μàρκου: Να θεσ πιστεi Εθνικor Αρχor Χρηματοοικ&omicron ;νομικων Υπηρεσιων


– What are Deloitte's next moves in terms of services offered, are you preparing some new innovations?

– Nowadays, the ability to adapt and respond to changes and developments happening around us has proven to be more important than ever. The world we live and work in is constantly changing and even our ability to grow and evolve is now imperative. What sets Deloitte apart is our ability to remain agile by turning challenges into opportunities, even in times of great turbulence, and our ability to continue to develop and deliver the best possible services. This led us to realize early on the need for digital transformation and that the future of our services revolves around technology, data and talent. In recent years, we have emphasized our strategy of flexibility and technological advancement in our services to our customers, with the aim of improving business performance, integrating technology and completing our digital transformation. This is something we expect will help us navigate the future and adapt to future demands.

In general there is an increase in the adoption of artificial intelligence in all sectors, including our own. This is how we strategically automate our operations, strengthen cyber security measures, invest in ERP (Enterprise Resource Planning) and cloud technologies and optimize our internal processes to ensure seamless operations with the aim of offering solutions and services that will deliver valuable insights to improve decision-making processes and to improve the performance of our clients' businesses.

At the same time, in recent years we have made significant progress in implementing policies and practices to transform our organizational culture, give our people greater autonomy at work and give them a sense of empowerment. Following Deloitte's global trends and strategy, we invest in the development of innovative services that derive from strategies for ESG, climate and sustainability, and targeted at “blue and green economies”. Equally important is the emphasis that Deloitte places on supporting new innovative businesses, through its innovative programs and the practical support given by ARIS through innovative support actions that are expected to expand in the coming years.

AI and services

– How do you think artificial intelligence (AI) will affect your occupation?

– AI is not something completely new. It has long since begun to affect the world and greatly transform business, but also ourselves and the way we interact with each other and with our environment. Examples from the simplest and oldest applications – e.g. the recognition of people/scenery/events from our smartphone cameras/customized and targeted recommendations for products/content/video/music/ads from Amazon, Netflix, YouTube, etc. through the use of algorithms that make predictions based on behavioral patterns/AI-based text and language processors are used to create content (image or texts) or for customer service (eg chatbots)/banking and financial applications for fraud detection, KYC checks & AML, credit scoring, financial forecasting and more.

Looking ahead, we expect an increasing adoption of artificial intelligence in all sectors. As I mentioned before, we are already moving in this direction. The future of our industry is based on our ability to embrace technology and thus be able to offer customers service excellence. Customers are demanding more efficient and cost-effective services, while our staff want to be able to spend more time on value-adding activities. Through our business strategy we embrace the technological revolution, focusing on digitization and strategically use AI to improve our business performance.

One of our key priorities is to develop our real-time data collection and analysis capabilities and use analytics to help us turn data into strategic solutions for our clients, offering them valuable insights to improve processes decision making. All this brought new demands from our client companies, but also gave birth to new needs. Combining the power of artificial intelligence with other technologies such as automation, analytics, visualization and platforms, without of course ignoring the human factor and the need for changes in organizational culture and the way staff work, will give new impetus to our domain by offering new features that can have a huge impact.

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Source: www.kathimerini.com.cy

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