Climate Change: The New Investment Frontier

by Elizabeth Harrin (London)

Fund managers are faced with a rack of new decisions, shaped by the climate change agenda: should we invest in ‘clean’ energies like wind power? If you know an organisation consumes a lot of carbon, does that make its market value less? On top of that, it’s a political hot potato, with the impending discussions at COP 15 (December’s climate change conference), and the Obama administration pushing ahead for a cap-and-trade scheme.

With the US carbon emission trading market set to be worth $1 trillion by 2020 investors can’t help but take notice. Companies are going to need to know exactly how much they are emitting. A whole industry has sprung up around green house gas emission calculations, with the aim of permitting allowances to be accurately traded with software like GreenCert, which has been produced as a joint effort by IBM, C-Lock Technology, Inc. and Enterprise Information Management.

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In Case You Missed It: Business News Round-up

martin1Contributed by Martin Mitchell of the Corporate Training Group

The FDIC identified an increase in the number of problem banks. The Terra Firma seals its first US acquisition. Close Brothers are bidding for a private banking franchise. These are but a few highlights of important market events that we’ve gathered to help you start the week well informed.

Economic Backdrop

  • The gathering of the world’s central bankers at the Federal Reserve’s annual retreat concluded. The general conclusion was that the world’s economies are starting to recover, with most officials believing that interest rates could be maintained at ultra-low levels for a considerable time without generating excess inflation. However, the majority also thought the road to recovery is likely to be long and bumpy.
  • President Obama also announced his intention to reappoint Ben Bernanke as chairman of the Federal Reserve. The reappointment needs to be confirmed by the Senate.
  • Details of Germany’s second quarter 0.3% GDP growth figures showed that consumer spending rose 0.7%. However, the GDP in the quarter was 7.1% lower than the same period last year.
  • German businesses’ expectations have improved. The Munich-based Ifo institute business climate index has risen from 87.4 in July to 90.5 in August, its highest level since September 2008. The part of the survey that relates to expectations over the next six months rose even more quickly from 90.4 to 95 – the biggest monthly rise since the survey started in 1991.
  • Central banks grappling with ways to encourage banks to lend are keeping a close eye on Sweden. Last month the Swedish central bank (the Riksbank) became the world’s first central bank to introduce negative interest rates on bank deposits. Designed to boost lending, the Riksbank has a deposit rate of minus 0.25 per cent.

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Queen of the City: Pay Limits for Bankers? The Debate Rages On

Early Morning View of Big BenIn the last ten years, the average FTSE 100 chief executive’s pay packet pole-vaulted up by 295%. Contrast that with the mere 50% increase in earnings of average citizen in the UK (according to Manifest, which advises investors on corporate governance). The banking industry hasn’t exactly held bank on paying itself big bucks in bad times and overhauling the way bankers’ pay works is of pressing urgency to an industry with a reputation as storm-tossed as its budgets.

On this side of the Pond, we found it a bit strange that, in the US, CEO and CFO pay at more than 100 banks on the TARP program did not decline in line with profits. In the City, there’s much dissatisfaction at guaranteed bonuses being waved at some lucky so-and-so’s by banks still owing millions to the government. Muttering taxpayers are saying “But it’s our darned dosh they’re throwing at these guys, not theirs.” The resentment among those who’ve lost jobs, bonuses and taken a big hit on their pension pots is running feverishly high.

It’s no wonder then that, this past March, the FSA, in an effort to align executive compensation with risk for bank boards and management, recommended that two-thirds of bonuses should be deferred, and that individual compensation awards should also reflect the overall performance of the business, rather than that person, team or division. More puzzling, however, is the Financial Services Authority’s recent pull back from the sterner draft suggestions.

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Green Jobs for Executive Women in Finance and the Fortune 500

istock_000003447790xsmall1by Liz O’Donnell (Boston)

Even as traditional jobs are being cut, “green” jobs are opening up, creating hot new career opportunities for executive women.

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35 Under 35: Gayle Tait, General Manager of UK and Ireland business, L’Oréal

For our ongoing series, London-based writer Elizabeth Harrin spoke with Gayle Tait, a 32-year-old executive woman from cosmetics giant L’Oreal, about her career path, her international placement in Paris, and her ascension to general manager of Ireland and the UK.

gayle1General Manager of L’Oréal at the age of 32, Gayle Tait has come a long way—in a very short time—from the dreaming spires of Oxford. “Age doesn’t come into it,” she says. “As long as I do my job the best I can, I think people respond positively.”

“Initially I was interested in joining [the company] because it is a sector that appealed me personally,” Tait explained. “I did an internship in the summer between my second and third year at university and it was following that experience that I wanted to join L’Oréal permanently. The people, their energy and their passion, and the fact that I had so much responsibility so early on in my career, were very appealing to me.”

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Confessions of a City Girl: Navigating the Testosterone-laden Financial Industry

What does it mean to be a City Girl today? Can City Girls have it all? Barbara Stcherbatcheff (a.k.a. City Girl), who has worked in banking and derivatives in London for over five years, tackles these questiosn and more in her new book called “Confessions of a City Girl.”

TheGlassHammer.com has 10 signed copies of the book to give away. To win, simply join The Glass Hammer social network and post a comment or discussion. The ten members who’ve posted the most thought-provoking comments/discussions win a copy of the book. This competition ends Friday, so join today!

citygirl11

Women occupy a special place in the City of London. There aren’t many of us, but the successful ones have overcome exceptional odds.

I started my financial career bright-eyed, with a suitcase full of hopes. I was looking for fortune, freedom, and maybe even love. And amazingly, I found it all, but not without some challenges.
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Ask-A-Career-Coach: How Do I Create A Cover Letter Template?

jobsearchContributed by Caroline Ceniza-Levine of SixFigureStart

When creating a profile specifically for a company’s hiring site, what is the best, most effective “generic” cover letter for different positions within various divisions?

This question came from a recent teleseminar attendee, and I love the sub-questions implicit in it.

First of all, should you ever write a generic cover letter? The ideal answer is no. You should have a specific position in mind and a specific person to whom to address the letter. Knowing the position enables you to highlight the right skills and experiences within your background that position you appropriately. Knowing the person enables you to better engage the reader. However, some companies ask that all candidates, even senior ones, upload their resume into the hiring site, so in that case your cover letter ideally mentions you are referred by Jane Doe Insider regarding the X Specific Spot.

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Overcoming Madoff in Fund Management

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by Elizabeth Harrin (London)

UPI Photo/Monika Graff

UPI Photo/Monika Graff

 “We have definitely seen a deterioration in potential investors because of Mr. Madoff’s activities,” says Tonya Powell, Principal at ELP Capital, Inc, investment company which specializes in real estate-secured assets. “The biggest issue is trust, and the almost automatic assumption created by the media that all fund managers may have participated in the same kind of activities.”

Judi Snyder, Partner at JP Snyder, Inc, a boutique financial planning firm, agrees. “Previously, people blindly trusted advisors and didn’t do their own research. This blind trust led to much of the current economic and investor climate.”

Both women’s firms are using multi-pronged approaches to win back consumer confidence. “There’s a fundamental shift – clients are demanding more education,” says Snyder. “I believe, however, Wall Street doesn’t necessarily want people to be educated.” This is a problem that Snyder’s firm is tackling head-on. “We give our clients homework,” she says. “We want them to do research, become educated and ask questions. We want them to take as long as they need to be comfortable with the investment options that we recommend.”
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Voice of Experience: Marlys Appleton, Vice President and Chair of Sustainability Steering Committee, AIG Investments

smile_bangs_5617_cropped1by Pamela Weinsaft (New York City)

Marlys Appleton, chair of AIG Investments’ Sustainability Steering Committee, is a champion for and architect of the integration of sustainability into the investment process. But it is a role no one – not even she – could have foreseen when she began her career more than 20 years ago.

Upon completing a fellowship and an MS from MIT’s Sloan School of Management, Appleton started her multi-disciplinary career as a financial analyst at Morgan Stanley. But she switched paths and companies a few years later when she heard the siren call of sales. “It looked as if people were having more fun and making more money [on the sales track].” When Appleton reached out to management to try to make the switch, she was told that, while adding her to the sales force would likely upgrade the skill level of the force, the head of the sales desk only hired his ski buddies. It was an important lesson for Appleton, who then realized that not all promotions are based on one’s abilities; some are based purely on who you are.

She then joined Bank of America as an institutional fixed income sales person, ultimately becoming the top producing salesperson on the East Coast in the bond trading operation for the bank. She attributes that success to her thoroughness and her ability to build trusting relationships with clients. “I’m an information hound,” says Appleton, “I want to know and understand everything myself before presenting it to clients. I think that what made me the most comfortable was what made the clients most comfortable with me. I was successful because, over time, the foreign and domestic banks and domestic money managers I had as clients learned that I wouldn’t lead them down the wrong path and they could trust me to deliver for them.”

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In Case You Missed It: Business News Round-up

martin1Contributed by Martin Mitchell of the Corporate Training Group

European private equity LBO activity shows signs of life. The Swiss government makes a 26% annualised return on the UBS bail-out. Global corporate bond issuance for 2009 is already more than $1 trillion. These are but a  few highlights  of important market events that we’ve gathered to help you start the week well informed.

Economic Backdrop

  • Ben Bernanke reinforced hopes that the global economy is on the mend. Speaking at an annual Federal Reserve conference, he said,”‘after contracting sharply over the past year, economic activity appears to be levelling out both in the US and abroad, and the prospects for a return to growth in the near term appear good.”
  • US office prices rose in the second quarter for the first time since 2007. A report from Moody’s showed a 4.1% increase in office prices, however industrial, retail and apartment building continued to suffer with the overall index falling 1%.
  • Minutes released from the last meeting of the Bank of England’s monetary policy committee revealed that the Governor of the Bank had wanted to increase the money injected into the UK economy via ‘quantitative easing’ by £75bn. However, the committee voted for a smaller £50bn injection.
  • The UK’s Office for National Statistics published inflation figures for July. The main measure of inflation, the consumer price index was at 1.8% in July, unchanged from June. Average forecasts had been for a sharp fall to 1.5%. The retail price index that includes mortgage rates was at minus 1.4% in July. In the foreign exchange market sterling jumped in anticipation that the Bank of England’s monetary policy committee will lift interest rates earlier than previously thought.
  • Following last week’s positive news of Germany and France coming out of recession with growth in the second quarter, Japan reported its second quarter’s GDP up by 0.9%. However, the Japanese GDP was well below average forecasts.
  • Iceland’s parliament is close to approving the repayment of nearly €4bn lost by British and Dutch investors in failed Icelandic banks.
  • Just over 9 months after their banking crisis, Iceland is also experiencing a baby boom, with deliveries up 3.5% so far this year. One commentator thinks many Icelanders have ‘sought solace in love and sex.’

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