By Tina Wilkinson is Global Head of Product at Lombard Risk
A shortage of women in senior roles still exists in the financial industry today despite efforts to achieve equality. The industry needs to encourage more women to pursue careers in finance as it is mutually beneficial to female professionals and the global industry.
We’ve learned from Mercer’s survey results last year that support staff in finance and insurance are 76 per cent female, but women make up only 30 per cent of senior managers and 21 per cent of executives in the industry. Moreover, out of Europe’s top 50 Fintech firms, women hold less than five per cent of top executive roles, according to Innovate Finance.
Having spent over 30 years in financial services myself, I consider this to be an opportunity missed, for both employers and women in the workforce. Women can make an immense contribution towards the industry and can carve out a fulfilling and rewarding career for themselves.
Changes in the financial services sector have created opportunities which require a range of skills to fulfill – from technical to strategic to relationship management. Financial institutions are changing; they are reassessing their structures, introducing new – and more senior – roles to deal with the increasing range of regulatory measures with which they need to comply. They are also embracing the opportunities technology provides to improve customer service and provide competitive advantage. Morgan McKinley’s UK 2016 Salary Guide cites growing opportunities in the industry in the areas of compliance, risk management, auditing, project and change management, technology and digital product management.
It’s a fast-paced and exciting industry; one that is in the throes of unparalleled change that’s unlikely to abate. Having a competitive edge and a drive to stay ahead of the game is essential; as is a desire to embrace roles that are central to an organisation’s business success.
While contributing factors to job satisfaction vary from person to person and across stages within an individual’s career, I would call out the following top four reasons to work in financial services:
- Pan-team working
The time of silos in financial institutions is past. To ensure the customer is front and centre in a financial services firm’s focus, companies have to work across business lines, product lines and market segments for a ‘holistic view’. Firms need to act and be one organisation. This means working across teams responsible for different sectors, with everyone pulling together to ensure successful delivery.
Many financial organisations operate globally so there is the opportunity to gain experience working across markets and regions, interacting with colleagues, suppliers and customers from different backgrounds and cultures. Women form a valuable part of the diversity of teams. Teams with a broad range of skills, background and culture are generally more successful, and financial institutions are embracing this.
- Being a part of change
The pace of technological change at this time in financial services is unprecedented. To meet the demands of evolving regulation, competition and rising customer expectations, companies are automating to accelerate, drive efficiency and deliver more immediate, comprehensive business insight. Now is the time when individuals with vision can make a real difference in the way companies meet their objectives, as well as how the industry develops. There is never a dull moment.
- Learning from great minds
The demand for new skills within the industry has brought fresh talent in, providing software, data and collaboration expertise. This provides golden opportunities for individuals to expand their own knowledge, to develop contacts and build connections with people who are driving the industry forward.
Within my own career, I have worked with global firms in the US, France, Luxembourg, Germany and the UK. Working and living in strategic European Markets, while running global business lines, has allowed me to develop a strong network of colleagues across the banking and insurance sectors.
- A chance to develop new skills
Financial services offers opportunities for individuals to broaden their skills within their own discipline and to develop and build new skills in other areas. Working with global banks and insurers, which also have strong domestic markets in the above countries, has given me an appreciation for the cultural nuances that drive the decision making processes in different firms. One approach in management, like one size, never fits all. Firms, like each of us, are unique. Learning to adapt is a key skill.
Much of my career has been focused on working across many different markets. What I have realised is that by working outside your comfort zone and, if you can, outside your home market, will allow you to learn more about yourself and about clients’ requirements. You learn how products are built to excel in specific markets, and how they are sold.
And language skills count. While English is important, it is not enough. Every language is a map to its culture. Learning what each culture values, adds value to you. It is this flexibility, this agility that transforms your experience into something vital for global firms. And each firm will need to articulate its “uniqueness” ever more effectively in order to differentiate its services from competitors in an increasingly global market. This is the real challenge.
So much is changing in the financial markets today. Regulation provides a framework, but it is a moveable feast. This makes marketing products that are somewhat intangible even more challenging. So all risk and compliance professionals, as well as marketers and sales professionals – I encourage you to bring your expertise to a fast evolving industry. Technology affects speed and delivery mechanisms in finance. If technology is your area of focus, the changing shape of banking and the channels we use to reach out to clients, along with the necessity to do everything faster and more efficiently, offers a wealth of challenging and rewarding opportunities. The bottom line is – creative and motivated women can have a tremendous impact in this industry.
As women take up a higher percentage of roles in financial services, they will be in a privileged position to shape and develop one of the most exciting industries.
High-yield bonds will help, not hinder, businesses’ recovery
By Jesse Chenard CEO of fintech MonetaGo,
One of the best indicators of stock market growth is high-yield bonds. The junk bond market is more important than ever as we recover from coronavirus – allowing companies to raise vitally needed capital and giving investors the opportunity for returns that will fuel speculation and drive growth across the whole economy. Junk bonds, or ‘high-yields’ to give them a less derogatory name, will drive the recovery just as surely as the rebounding stock market will.
Companies who have suffered with low liquidity under the pandemic need to raise capital and return to viability. According to J.P. Morgan Chase, bond-issuance has already reached $238 billion – almost double this time last year. It is clear that high-yield bonds are going to drive economic recovery and allow viable, but cash-strapped, companies to regain losses caused by Covid-19.
Companies striving to boost their capital, improve liquidity and rebuild after the pandemic need systems around issuance to be quick, effective and secure. Yet, the issuance process remains slow, costly and encumbered by legacy systems.
Avanade’s research found that up to 80% of IT budgets are allocated to keeping legacy systems running. Technology can help reform the process and give companies the funds they so badly need.
According to Bloomberg, global corporate bond issuance is on track to reach a historical high in 2020, as total capital raised neared $6.4 trillion (June)— already 71% of 2019’s total.
But the process of issuing bonds is unbelievably slow and largely manual. It takes an average of 30 stages with human intervention at each point, including physical paperwork and contact between multiple parties and intermediaries.
The fact that so many of these processes are still multi-step and using people and paper is archaic and inefficient in normal market conditions.
During the lockdown, it looks positively stone-age. And then there is the risk of data leakage and security, which are horribly compromised by existing processes. Two years ago, I visited Credit Suisse’s office on Madison Avenue where they told me that they send 20,000 to 30,000 faxes a day to carry out activities that could be very easily automated and digitized: a scary thought from a data security perspective.
It seems odd that in a world where we are used to securely accessing our personal finances at the click of a button, the same cannot be true for business finance.
This is a massive, liquid market. It needs modernizing. Add to that the fact that volumes have ballooned as crisis hit firms work to raise working capital and return to viability. That process should be entirely digitized and speeded up. Companies recovering from the pandemic deserve better than outdated, unsecure systems.
There is no question that technology is the key here. There are solutions to digitize the entire process, allowing businesses to greatly reduce their time to market and their banks to provide a vastly improved service to their corporate customers.
When normal ways of working are disrupted, it brings to light the inefficiencies in document workflows that cost businesses thousands of dollars in fraud each year, not to mention the other cost of lagging behind due to outdated processes.
There is now an opportunity to take the lessons learned from the pandemic and digitize processes that have shown they need it. Covid has forced financial services to digitize in many ways but the high-yield bond market is lagging behind. We need to bring this crucial sector up to speed. Companies deserve fast, efficient and secure issuance systems to stimulate their recovery and kick start the global economy.
Finance leaders must act against increasing fraud
By David Thorley, Director of Customer Development, FISCAL Technologies
The COVID-19 pandemic has resulted in a whole host of increased pressures on both business and individuals, worsening issues and vulnerabilities that were already present, as well as shining a light on new issues, never witnessed before. With this in mind, retaining and protecting cash has never been more important and therefore the role of accounts payable and the procure-to-pay function are crucial. These functions need to work together and do so proactively in order to succeed in the current climate.
It is also key that AP teams have all the right financial controls in place to minimise errors, maximise visibility of transactions, and streamline processes – especially with so many people now working from home and the various compliance challenges this creates. In essence, it is about taking a more forensic approach to AP activities.
According to fraud experts, each company has around a one in three chance of experiencing internal fraud this year, with enterprise organisations averaging losses of $1⁄2m. These attacks typically claim payments which are under the financial risk review threshold, hiding within the hundreds of small invoice transactions until found by AP Audit software or internal audit routines.
Finance ERP and P2P systems – often described as the heart and lungs of a company – have a complex relationship and are known to have vulnerabilities, opening them to fraud. This is especially true in enterprise organisations where the adoption of artificial intelligence (AI), complex system integration and automation delivers a touchless-AP process, but may lack in the controls of traditional processes.
Additionally, centralisation or de-centralisation of the P2P function and systems, acquisition or mergers also creates a higher vulnerability to duplicates, errors and fraud. When systems are being configured and resources are stretched, errors and omissions occur, processes take time to adapt and this allows sophisticated fraudsters to target these types of transformation projects.
Missed historical data creating risk
As migration projects typically copy only open transactions to the new system – historical transactions seen as being of little value – transaction history can be lost. Spotting irregularities relies on comparing transactions with historical data so that the validation of duplicate payments is hindered.
During ERP migrations the Master Supplier File (MSF) is frequently left untouched and copied in its entirety from the old to the new system. This creates heightened risks as supplier reference changes in the new ERP’s MSF make historical look-ups impossible and the opportunity to remove unused, out-of-date and duplicate suppliers – a hotbed for fraud – is removed.
Particularly at a time like right now, it’s crucial that organisations are able to take action in recovering missed payment errors.
Internal planned attacks
Over the past few years, there has been no shortage of stories about internal company fraud or senior finance professionals being tried in court for finance fraud. While only a small proportion of these incidences become public knowledge, as organisations fight to keep reputational damage at bay, it’s essential that companies place finance fraud high up on the corporate radar in order to protect against these threats.
According to the KPMG Fraud Barometer, there was a six-fold increase in the number of alleged procurement frauds appearing in court in 2019, usually involving fake invoices. Six cases worth over £16 million appeared in court in 2019 compared to £2.9 million in 2018.
The individuals and groups who are deceiving businesses to gain payments, usually gain some inside knowledge of the processes or systems to enable them to set up fraudulent suppliers and divert funds to their accounts. They are sophisticated and plan their attacks.
The biggest risk factor when it comes to ERP fraud is allowing users to access parts of the system that they shouldn’t be able to see, thereby enabling them to commit fraud in a variety of ways.
The most common type is the dummy company fraud, where a user sets up a false supplier, processes fictitious orders and invoices, and pays for goods or services that are never received. This is surprisingly easy to perform for a user with a little too much access. But there are many other forms of deception, including supplier bank account changes, inventory manipulation and unauthorised changes to payroll data. Proper control measures can mitigate these vulnerabilities to a large extent.
Nobody wants to believe that they are at risk of fraud, that their processes, systems and governance cannot safeguard their profits, however, invoice fraud is becoming a lucrative industry. Today’s finance leaders need help to keep ahead of the threat in order to protect and retain cash – the number one priority.
The UK Property recovery has begun
By Jamie Johnson is the CEO of FJP Investment,
The UK property sector will be integral to the country’s economic recovery from the direct and indirect effects of COVID-19. The Government certainly believes as much, with Chancellor Rishi Sunak implementing a series of sweeping changes to support property transactions amidst the pandemic. Most recently, on July 6th, 2020, it was announced that the first £500,000 of all property sales are now entirely exempt from Stamp Duty Land Tax (SDLT); including buy-to-let properties and second homes.
This attempt at boosting stimulus in the market is understandable. The real estate market is a key driver of national productivity and a big attractor of foreign investment to the UK. Thankfully for the Government, this policy has already been shown to be going some way in unlocking the stagnant demand for property that has been held back by COVID-19 uncertainty.
The boost the market needed
Mere weeks after this tax break was introduced, property journalists were already reporting a mini-property market boom. The property listing site Rightmove recorded an incredible 75% year-on-year increase for the month of July and a 2.4% rise in the asking prices of new properties on the website when compared to March levels pre-lockdown.
Whilst it is still too early to gauge how actual transaction numbers have been affected, this is a huge indicator that the Government’s policy has, thus far, been a success. After months of property price decline and housing market inactivity due to contagion fears surrounding COVID-19, the slump has finally ended, and buyers now feel confident enough to close on purchases once again.
But this demand will not be spread across the UK entirely evenly, so it’s worth examining how the continued presence of COVID-19 in our lives is shifting priorities in the minds of prospective buyers.
Stable demand, popularity shifting
With the working from home revolution seeming like it’s here to stay, it’s understandable that many of the working professionals who have found themselves having to turn their living spaces into work spaces may seek larger properties further from their employer’s traditional office space.
The aforementioned Rightmove figures support this claim. The rise in interest of London properties was just 0.5%, far behind the national average. This would make a change from the traditionally London-focused drive of the nation’s housing market; especially if we consider that this change in buyer sentiment may spur investors to look to places other than the capital when deciding where to invest in new high-end developments in the future.
Sunny skies ahead
This imbuing of market activity is likely to push up house prices for the foreseeable future. This would certainty follow expert’s forecasts, as global estate agent Savills recently stood by their prediction of 15% general house price growth in the UK by 2024. They cited the inevitable return of the buyer demand we witnessed in January 2020 once the novel coronavirus was in retreat; and it largely seems like, in conjunction with the Government SDLT holiday, this is exactly what’s happening.
FJP Investment commissioned research earlier this year which supports this projection. We found that 43% of property investors weren’t planning on making any financial decisions until COVID-19 had been effectively contained. With the virus now in retreat, it seems like confidence has risen. As a result, both investors and buyers are returning to the market in droves. Nationwide’s House Price Index for July, for example, showed that house prices have increased by 1.7% month-on-month.
Of course, I must taper this optimism with the knowledge that a second spike in cases or virus mutation could well set this recovery off-course. In short, there are still plenty of unknowns to content with.
However, as it currently stands, it seems as through the Government’s SDLT tax break will successfully encourage buyers (and sellers) to push up housing market activity for the foreseeable future. I look forward to being to a part of the UK property renewal in the coming months, and for the housing sector to provide the impetus for a strong UK economic recovery more generally.
The ultimate tech guide to remote working for the casual worker
By Paul Routledge D-Link Country Manager Like many others, you may have grabbed your laptop in the middle of March...
Safeguarding international logistics arrangements during the coronavirus crisis
By Adam Ewart, CEO and Founder of Send My Bag It has certainly been a whirlwind couple of months. The coronavirus...
The Future of Finance Teams: Digitally Transformed
By Simon Bull, Sales Operations & Business Development Manager at Aqilla Finance teams haven’t always been at the forefront of...
High-yield bonds will help, not hinder, businesses’ recovery
By Jesse Chenard CEO of fintech MonetaGo, One of the best indicators of stock market growth is high-yield bonds. The junk...
A holistic view of organisational security
By James Ward, Senior Cyber Consultant at MASS The finance sector is typically more developed than others when it comes...
IDnow: Putting a new face on identity verification
By Charlie Roberts, Head of Business Development UK&I at IDnow Munich headquartered IDnow is an identity verification provider which uses AI-based...
Finance leaders must act against increasing fraud
By David Thorley, Director of Customer Development, FISCAL Technologies The COVID-19 pandemic has resulted in a whole host of increased...
NextGen Communications – the future of customer experience
By Andrew Beatty, Head of Global Next Generation Banking at FIS As software development increasingly resembles push updates in services,...
The UK Property recovery has begun
By Jamie Johnson is the CEO of FJP Investment, The UK property sector will be integral to the country’s economic...
The Derry Group launches new employee engagement and communications app
The Derry Group, a one stop shop for the distribution, storage and order picking of chilled and frozen products has...