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SALES & MARKETING MARKET COMMENTARY, Q4 2019

• Article by BRUIN Financial

SALES & MARKETING MARKET COMMENTARY, Q4 2019

MARKET OVERVIEW

Equity and Fixed Income growth

Quarter 4 in 2019 saw both equity and fixed income markets continue to generate remarkably strong returns for investors. Such strong returns for both asset classes are unusual given the backdrop of weaker global economic growth, lower earnings growth, elevated geopolitical uncertainty and trade tensions. This led to a demand in Product Marketing, RFP and Investment Writer positions that focused specifically on Fixed Income and Equity.

Marketing

Another trend over the last quarter has been heightened demand for Directors and Senior Managers within Corporate Communications, PR and Media Relations, both for positions based in the UK as well as regional European offices. We have worked on a number of these senior mandates with some of our larger asset management clients.

Sales

The volume of Sales roles increased towards the end of the year, with the most significant demand in the advisory and third party distribution space. A number of our clients have been bulking up these teams within Investor Relations as well as asset raising roles. There has been a surprising resurgence of UK regional sales roles within Investment Management in order to assist the UK sales efforts. In addition to this, we have also seen a number of UK based Sales Manager roles where individuals have been required to build and create client relationships across Europe, with an increasing requirement of European languages.

The lack of women in Sales was specifically cited by an overwhelming number of asset managers as one of the most significant factors contributing to their gender pay gap in the UK. With larger UK organisations required to publicly disclose their gender pay gaps. We have been asked by some of our clients such as Legal and General, T. Rowe Price, Vanguard, BNY and Fidelity to produce balanced gender shortlists, particularly at the senior rings of the ladder.

ESG

A lot of our asset management clients are putting ESG higher up their agenda, and some of the asset managers leading the way are Legal and General, Allianz, UBS Asset Management and Aviva, who have a significant level of engagement with the Paris Climate Deal.  Aviva for example have a large Responsible Investing team (more than 20 people) and are credible in this area. Responsible investing runs across all their policies to ensure a fully integrated approach across all propositions. They have also launched a few ESG funds e.g. Climate transition fund.

Smaller asset managers seem to be doing a lot of the heavy lifting for the entire industry and between them filed 20% of all climate related resolutions in 2018.  Some of these include Hermes, Sarasin and Partners, and Trillium Asset Management.

Investor responses to climate risk vary – even among those with a solid understanding of the issues.  ESG and negative exclusion strategies are making some progress, and there is regulatory pressure set to force asset managers to recognise and report on their approach to climate risk. However this needs to happen faster if we are to achieve ‘net zero carbon’ by 2035 and ‘absolute carbon neutral’ by 2050.

The recent ‘intergovernmental panel’ on climate change announcement recently that we have 12 years to take action, which gives us a sufficient enough time frame to be feasible, yet is adequately short to catalyse action.

Fund Managers with sound ESG, sustainability themed or ethical fund options and strategies understand this all too well and are leading the way. The decision therefore remains for other investors to make: fight or flight? Engage or divest? Or combine the two.

The move towards ESG has meant that we have seen an increased number of senior ESG Product Marketing and ESG Front and Middle office roles. Our clients have been looking for individuals with a keen interest in broader economics and responsible investing.  We have also seen an increased desire for candidates to move into these roles.

Fin Tech

Technology looks set to change the way managers communicate with clients and investors as much as it has changed (and will continue to change) the investment process, with AI offering up increasingly granular and powerful audience insights. Moreover, regulation and political oversight seem likely to play just as big a role in the direction of travel as they have in the last decade.

Last quarter we saw senior Distribution professionals transition into leadership positions within various FinTech providers. Our asset management clients have realised that they need to evolve rapidly in order to continue to attract the best and brightest talent. They are looking at ways to tap into niche skill-sets, attract fresh talent and to retain their existing talent through harnessing a modernised approach to flexible working, offering more reasonable working hours and a more diverse workforce. Diversity and Inclusion (D&I) initiatives are increasingly a significant factor that influences candidates’ decision to join a firm.

 

MOVERS & SHAKERS

One firm we have seen movement from in Q4 is Triple Point Investment Management who have recently hired Jennifer Ockwell from Franklin Templeton, as a Partner in their Institutional business. Jennifer’s career spans over 20 years in the asset management industry which started at Deutsche Asset Management. Greg Jones who was Head of EMEA, LatAm and AsiaPac distribution at Janus Henderson has left the firm to take some time out with his family and pursue other opportunities. His responsibilities will now be taken over by Suzanne Cain, Global Head of Distribution who joined the firm in May this year.

Joseph Pinto joined Natixis Investment Managers as Chief Operating Officer which was a newly created role. Mr Pinto did a similar position at Axa Investment Managers. In November, Phillip Setborn joined as Chief Executive of Ostrum Asset Management and was previously Chief Executive of Groupama Asset Management replacing Matthieu Duncan. In March 2020, Nichola Please will succeed Liz Alrey to chair Jupiter Asset Management. Ms Pease was formerly Chief Executive of JO Hambro Capital.

Within Consultant Relations there has been movement within Nuveen, the $1tn asset manager who hired Gregory Ohlson as Head of UK Consultant Relations for the international advisory services team.  Mr Ohlson joins from Pinebridge investments.

Ray Ahn has joined PGIM as the Global Chief Marketing Officer. Mr Ahn joins from Capital Group where he was Marketing Vice President.  Gabriel Altbach, who was previously Head of Global Strategy and Marketing at Pioneer Investments, has now joined White Marble Marketing as US President and Head of North America for the London-based asset management focused marketing consultancy.

 

ROLE PROFILES

A key trend over the last few months has been the increase in the number of Public Relations roles which have become available. This is due to uncertainty within the market with the IR35 regulation due to be implemented in April. On top of this, we move closer to the Brexit deadline and companies want to communicate their stance.

Another trend we have also seen is the number of short term contracts, more recently temporary contract roles which have been between 3-6 months. This could be down to companies approaching the end of the financial year, they were reticent to bring in employees on a permanent basis. These short term roles may have also be a result of the IR35 regulations as when these contracts come to the end, Limited company contractors have had to decide whether they will go PAYE or via an Umbrella firm.

The demand for RFP writers in the industry has been high too. Opportunities have been made available across all seniority levels. This is supported by the fact we have seen them coming out for different product types such as equity and fixed income. These RFP roles have also led to a spike in the number of sales roles becoming available. They have been appearing across a number of different channels specifically intermediary, institutional and wealth.

This quarter we have seen an increase in the number of specialist marketing roles as firms focus on specific channels, from direct marketing all the way through to various different types of digital marketing roles. Some of these digital roles are focused just on the website, email marketing or social media marketing.

 

PREDICTIONS

As mentioned previously, the short term future of the contracts market in London is going to change somewhat due to the impending IR35 regulation. As was seen from the public sector implementation date back in April 2017, this will impact a proportion of the day rate contractors in financial services who want to continue to using their Limited Companies. In the run up to the general election in December, Sajid David and the Conservative Party said that they may review the extension of IR35, although this wasn’t an official pledge in their manifesto.

Some organisations, such as Lloyds and Barclays have indicated that they will wind down the volume of Ltd contractors, compared to the likes of HSBC and Morgan Stanley who have allegedly told their contractor workforce to either choose between being made permanent on their payroll or leaving the business. Whatever the outcome of the regulatory changes, we expect to see a large number  of contractors who will likely have to adapt the way that they go about their job search.

One area that will have little difficulty in attracting top talent, whether that be permanent or on a freelance basis, is within FinTech. The traditional brick and mortar world of investment firms and global banks is being redefined by fledgling organisations offering innovative customer-centric and digitally led propositions. In 2019, the London FinTech market raised over $2bn, with global investment in the sector reaching $73.5bn.

Whilst this was a relatively unknown portion of the market a number of years ago, an independent publication from Raconteur said that 37% of the global financial services industry now claims that they currently have FinTech products and/or services to offer their client base, with an additional 22% at development stage for potential future rollout. We predict that we will see numerous more roles released in this area, as the marketing and distribution of this rapidly competitive and growing space intensifies.

On a more fundamental level of recruitment, we are now entering into the typical bonus season. Combined with the usual desire for some people at the beginning of the New Year start their job search to further their career; we expect to see a number of replacement hires to be released to the market in Q1.

Whilst we have mentioned the likes of communications and digital roles have been in high demand, the expectation is that we will see areas such as events, presentations/graphics roles and sales positions becoming increasingly more available as candidates in these areas are in high demand for the plans for the year ahead.

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For more information about the market or current opportunities please contact one of our Consultants.