These global goals focus on people, the planet, prosperity, peace and partnerships, so much of the talk at the conference stressed the importance of the people aspect – with respect to financial services in particular.
Dr Amlan Roy, head of global demographics and pension research at Credit Suisse, stressed that retirement is not dead, merely different. “Older people need to be active, exercise, practice good nutrition and have interests,” he said.
According to Dr Roy, the industry is consistently underestimating longevity. Additionally, life-long learning means people can have second, and even third and fourth careers. So the industry needs to develop new solutions for clients and better approaches to understanding longevity.
Stephen Archer, a global business and economic analyst explained how economic forecasts often get it wrong – because they ignore too much of the real behaviour of people. Emotional beings can’t be computed into numbers.
While Wonga.com co-founder Jonty Hurwitz addressed how the financial services industry is being changed by technology, yet highlighted once again the importance of human emotions.
“The subject of money runs deep, and emotion does run deep in investment management,” he said.
According to Jonty, the rise of the robo-adviser is about the dream of capturing how future generations will deal with money. In his view, the need for advice won’t disappear because essentially, it’s emotions that need managing.
Equally, the need for communication will remain. But the way in which we communicate with investors will change. He showed the audience how they can use social media to drive client engagement, using emotion as a key differentiator.
He said that the industry is facing the biggest wealth transfer in history, from Generation X to the Millennials, presenting an opportunity for advisers to engage with a younger audience. “Clients need to feel held and looked after. We’re in the business of emotions,” he explained
Roland Rousseau, head of Barclays risk strategy group, believes investors essentially need three things: excess return after costs and inflation; acceptable costs; and a return without excessive risk. Continuing in a similar vein to previous speakers he stated that investment management is about keeping clients content in difficult times. He believes there’s a bright future for active risk managers, rather than active return managers.
The conference – hosted by Glacier by Sanlam and Sanlam Investments – was held in Cape Town on 6 May .
