John W. Fleming, the founder and principal of a Rio de Janeiro-based advisory firm which specialises in looking after expatriates involved in extractive commodities industries, is not entirely comfortable with having his business compared to the likes of those that sell earthmovers to FTSE 100-listed mining companies such as Rio Tinto and Xstrata, or offshore drilling machinery to BP and Shell.
Nevertheless, there is no disputing that Fleming, 43, has built a profitable and sizeable business catering for the investment needs of expatriates whose jobs mainly originate in the mining of minerals, oil and other commodities from Latin America.
Indeed, as many as 60% of Global Index International’s “thousands” of clients are involved in the oil industry, Fleming says, with a significant proportion of the rest also employed by multinational corporations that have set up operations in South and Central America in recent years, in order to take advantage of the region’s natural resource wealth.
African expansion
With more than £100m ($159.9m) in assets under administration and management – Fleming declines to give exact figures – and seven offices in Latin America, including three in Brazil and one each in Mexico, Colombia, Peru and Uruguay, Global Index is becoming an increasingly visible fixture on the Latin American expat scene. Most recently it has begun to expand into Africa, beginning with Nigeria and Angola – countries that, like Brazil, are major oil and mineral exporters.
Like some other advisory firms that cater to affluent expatriates, Fleming attributes Global Index’s success to its strategy of approaching every element of the business “properly and with a good structure”.
“We have a serious client service team, which enables us to deal with issues and help clients anywhere in the world, and they [the clients] know that we do. If a guy is having problems sending money to his wife in Timbuktu, they know we will be able to come up with a solution.”
A year of adventure
Fleming – whose great uncle was Sir Alexander Fleming, the Scottish biologist who famously discovered penicillin by accident – says he did not set out for South America in 1991 with the intention of setting up a pan-South American advisory firm there.
Instead, Global Index International evolved in stages out of what originally began, for Fleming, as nothing more than “a year, maybe three” of adventure and travel with a friend.
Up until this point, he had been working for a US commodity company in the City of London, after having grown up a self described “farmer’s son” in rural Sussex, England.
Colombian odyssey
A few years later, writing about his backpacking experience in 1993 for an English-language Colombian newspaper, Fleming described a harrowing journey through the impenetrable jungle of Panama’s notorious Darien Gap, “up to my knees in mud, the oppressive heat suffocating me, the blood pump[ing] around my body so ferociously I thought my valves would explode…my mind and body had had enough…
"I was facing the very real possibility I wasn’t going to make it”.
Fleming’s friend endured only a few months of this before returning to Britain, but Fleming himself persevered on his own for about a year, at which point he put down his first tentative roots in Colombia, where he took a job with a now-defunct Canadian gold mining company.
Here, in a town not far from Medellín, the Colombian city then known best for its drug cartel fuelled violence, Fleming’s affection for South America and its people deepened.
“It was a very high-risk place to be, but it was also wonderful, magical and exciting, and the people were amazing,” he says, byphone from his office on the outskirts of Rio’s affluent Leblon district.
“I’m still in touch with some of them. I think austerity and difficulties bring out the best in people, and intensify friendships.”
A few years later he relocated to Ecuador, and in 2004 – by this point married and the father of three young children (his wife is British/Irish) – Fleming moved on again, to Rio de Janeiro.
“Hard as it may seem to believe now, no one was talking about Brazil at that point,” Fleming recalls, noting that the “BRIC” acronym coined in 2001 by Jim O’Neill of Goldman Sachs was not yet in common usage, and the Brazilian stock exchange was then “in disarray”.
Personally, he was less than thrilled at the prospect of having to learn Portuguese after having only just mastered Spanish, and recalls how he “almost did not want to look at” the idea of upping sticks yet again and moving to Rio. “But it seemed obvious to me that Brazil was the place to go.”
Vida doce
Like many long-time expatriates, Fleming speaks today with authority about his adopted country, which is known for seducing foreigners with its vida doce (the local equivalent of la dolce vita).
He muses about how rapidly Brazil has changed during the seven years he has lived there; the vast gap between the country’s poorest and its wealthiest citizens; and how surprisingly expensive it is for expatriates, especially at the moment. (“I could put my kids in a boarding school in England for what it costs to send them to day school here, and a car is three times what it would be in the UK.”)
Regional crossroads
As it happens, Fleming’s experiences in this regard were echoed in July by Mercer, the US consultancy, which included both Rio and São Paulo on its annual list of the most expensive cities in the world for expats, at 12th and 10th places, respectively, up from 29th and 21st places in 2010.
For an advisory business, though, Brazil is ideally situated, Fleming stresses. Not just because it is a major regional crossroads for expats, but because of its “mid-Atlantic” time zone – three hours behind London and two hours ahead of New York, which he says makes Brazil an ideal location for a global business like his.
“I regularly have 7am conference calls with people in Singapore, where for them it is 6pm, which is not a problem for me because I start at six in the morning anyway.
“Basically in a 12-hour day we can cover the globe, apart from a few Pacific islands. And, of course, New Zealand, which is 15 hours ahead of Brazil, and which therefore was a bit of a pain in the backside during the Rugby World Cup.”
Asked whether there were any products that the life insurance and investment industries do not currently provide Global Index, but that he wishes they did, Fleming says his main gripe is that few suppliers are yet providing him with the kind of slick, state-of-the-art infrastructure behind their products that he says clients nowadays expect.
“They might be addressing this issue with platforms and so on, but they are not doing so quickly enough,” he says.
“We should not have to be telephoning companies to find out whether a transfer has come in, or not come in. Those days should be over, but for a lot of companies based in the UK, they are not. Which makes the job of looking after our clients very expensive, labour-intensive and slow.”
Futebol fever
On a lighter note, Fleming adds that in three years’ time, Brazil’s sports fans will get their own back on their rivals in New Zealand, when Brazil will play host to the 2014 Football World Cup, and followers of the All Whites will get to find out what a growing number of Brazilian rugby fans recently discovered about the joys of watching televised sport in the wee hours of the morning.
Brazil, of course, is the only country to have played in the final stages of every World Cup held thus far, and has also won it a record five times.
New Zealand’s football team, by comparison, is arguably about as much of a force on the global scene as Brazil’s virtually-unheard-of rugby squad, which has yet to make a Rugby World Cup appearance.
"We are looking forward to it here," says Fleming of the event, which is expected to attract some 600,000 fans from abroad, while creating a carnival-like atmosphere in dozens of venue cities across Brazil.
"It will be much easier to build relationship-building events for our clients around than televised rugby matches at 3am in the morning were.
“And thanks to Brazil’s time zone, most of the world will be able to follow their respective teams at a decent hour at the next World Cup – just as we are able to conduct our business at a decent hour all year,” Fleming says.
