Frontline industry executives from 1251 Capital Group, Amundi Pioneer Asset Management USA, Capital Group, Easton Vance, and PwC gathered during Nicsa's 2019 General Membership Meeting in Boston to share insights on how to stay relevant and bolster client value.
John Stadtler, Partner, US Financial Services Industry Group at PwC, moderated the event, which focused on how executive teams across the asset management differentiate themselves, particularly in the areas of technology, sustainable investing, and diversity & inclusion (D&I).
TECHNOLOGY
Lisa Jones, Head of the Americas, President & CEO at Amundi Pioneer Asset Management USA, said technology drives efficiencies in many areas of her business. Because Amundi’s front, middle, and back-office platform is in-house, rather than outsourced, the company can customize its own system with ease. “It allows us to move more quickly in terms of development,” she said.
As one of the 10 largest asset management firms in the world with a footprint across 37 different countries, Amundi also the advantage of a global perspective. “The banking robo-advice model is quite interesting in Asia and Europe, and there are things that I hope we in the U.S. can learn from that to help and wholesalers,” Jones said.
Tom Faust, Chairman and Chief Executive Officer at Eaton Vance, said that in addition to ongoing investment in a large-scale managed account platform, his firm is focused on leveraging the power of big data.
“There is an enormous amount of new data, mostly driven by the advent of smartphones, drones, and other technologies,” he said. “We’re in the very early stages of figuring out how to harness that direct data to drive alpha.”
John Hailer, President - Asset Management at 1251 Capital Group, agreed that harnessing the data is the industry’s biggest challenge. “The market's getting more and more efficient gathering data, selling data —but then what do you do with that data once you have it?,” he said. “To me, that’s a key factor in whether or not you are successful.”
DIVERSITY AND INCLUSION
Hailer said D&I efforts help firms mirror the society they serve and ensure long-term business sustainability. His firm aims to achieve diversity by removing age-old barriers to entry.
“It’s creating different situations that allow people to participate in a network they’ve previously been isolated from — not necessarily deliberately, but isolated because of the way the ecosystem was built,” Hailer said. “Unless you get enough people in thinking differently from you, you’re going to be limited to only thinking one way.”
Jones agreed that diversity and inclusion efforts are vital in acquiring the talent needed to deliver the best possible results for clients.
“I think we all have embarked on launching D&I programs because it’s so important to focus on race and gender,” she said. “What many of us have enjoyed about growing up in the asset management industry is really being exposed to that intelligent debate that you get when you have diversity of thought.”
SUSTAINABLE INVESTING
Jones said D&I efforts dovetail into environmental, social, and corporate governance (ESG) factors, which also pave the way for long-term performance advantages.
“The intersection of ESG, culture, diversity, and inclusion is a quite exciting part of my job,” she said. “You can't assess and evaluate a company based upon social issues such as pay equity, professional development, and respectful work environments the same way on a global basis because some of those criteria are quite different.”
Faust said the fastest-growing part of his firm is its individual separate accounts, which are structured to provide a level of customization in terms of ESG characteristics. “These are driven by the preferences expressed by the end investor,” he said.
Note: Although the observations contained in this work represent the best thoughts of the individuals comprising the NICSA panel, they do not necessarily reflect the views of NICSA or any of its member organizations. Matters addressed in this work may touch upon legal or regulatory matters, however nothing herein is intended to be or should be construed as legal advice. You should contact your own counsel in order to obtain legal advice regarding these or any other matters.
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