Annika Falkengren on her role as Managing Partner at Lombard Odier, sustainability and women in the workplace

Article published in NZZ am Sonntag, July 8, 2018

Annika Falkengren has become the most powerful female banker in Europe and has now joined Lombard Odier as the 106th partner in the bank's 222-year history.

For twelve years you were head of the major Swedish bank SEB, were elected "European Banker of the Year" and were among the ten most powerful female executives worldwide. Why did you switch to bank Lombard Odier?

At Lombard Odier, I was convinced by the opportunity to become an entrepreneur myself. Together with my six partners, I am not only an employee, but a co-owner of the bank. So I can be more entrepreneurial. Before, I used to mostly delegate, but now I can implement my own projects with my team. I also have much closer contact with clients.

However, you previously ran a company with 16,000 employees. Lombard Odier has only 2400, so does the change mean a loss of power?

What is decisive for me is the meaningfulness of my task. You see, here at Lombard Odier, in its 222-year history, I'm only the 106th partner. Our thinking is very long-term. When I pass on my position in this bank to my successor, then the company should be stronger than it is today. That's what motivates me.

You're one of seven equal partners at Lombard Odier. How does this management model work?

On the one hand, the founding family, which has been an anchor for this bank for seven generations, is important. Patrick Odier has been a partner for 32 years. But at the same time it needs fresh impulses from outside the family. We are currently four internal and three external partners. This model enables continuous development over generations and prevents abrupt changes. Above all, it promotes a long-term perspective. I recently met a client who has been with the bank for 52 years. He told me that his relationship manager only changed once during that time. Meanwhile his grandson is already a client of ours.

If you compare this philosophy with that of the listed SEB: Did you act less long-term as CEO because you were under pressure from shareholders?

As CEO, you have to be able to withstand this pressure, you must explain to the market why you take certain decisions. A stock exchange listing leads to transparency, which can spur management on to more performance. At the same time, however, it is important that the Board of Directors can guarantee long-term stability. At SEB we benefited from the Wallenberg family, which owns a substantial stake of the bank. This enabled us to expand into other countries during the financial crisis, although we had to accept lower profits for some time.

You speak of greater transparency due to the stock exchange listing: In Sweden you were personally attacked for your salary as CEO – which was moderate by Swiss standards. How did you experience this?

As CEO of a listed company, you are permanently in the public spotlight. My popularity made me a projection screen for topics of the financial industry that had nothing to do with me as a person. And as one of the few women in such a top position I was additionally very visible. The visibility was good for SEB in many ways, and it is possible that a man in my position would not have been as interesting to write about.

How did you make the leap to the top as a woman in the male-dominated financial sector - at the age of 43?

I advise young women to work in an area where their performance can be measured in concrete terms. I myself was lucky enough to join the bank's commercial department after graduating. There, our performance was assessed every day according to objective criteria. This is an important factor that many women lack to get to the top.

Is the low proportion of women in top management due to social reasons or is it due to the behaviour patterns of women themselves?

I guess it's a combination of both. What I often observe: If a man is interested in an advertised position and he meets five out of ten criteria, then he will apply. He assumes that he will manage the remaining five as well. Many women with the same qualifications, on the other hand, do not dare to do so. However, there is a growing recognition in society that gender diversity is beneficial at all levels.

Is Sweden more advanced than Switzerland in promoting women?

In Sweden we are progressive when it comes to promoting women into middle management positions. However, the top management positions are still lacking. Switzerland, on the other hand, generally still might have some catching up to do. Whereby I see this as a positive challenge: It gives me the opportunity to do a lot more here. However, it is not only the companies that have an obligation. Women must find ways to organize their family life so that it is possible to pursue a professional career.
 

Women's quotas for management positions are currently the subject of intensive debate in Swiss politics. How do you feel about that?

In principle, quotas interfere with the decision-making powers of company owners. They should be able to decide for themselves about their own company. On the other hand, pressure on quotas has helped to improve diversity on the boards of directors in Sweden. Ultimately, however, it is not just about top management: to be successful, a company can simply no longer afford to neglect 50% of the workforce.

Lombard Odier attaches great importance to sustainable investments. In Asset Management, which accounts for around one-fifth of the total client assets of CHF 270 billion, almost 100% of the funds are invested sustainably. Does this suit a noble private bank?

Our partnership model is already designed for sustainability. The bank also has a long tradition in philanthropy. We recently entered into a cooperation with the Global Fund which also collaborates with the Bill and Melinda Gates Foundation. However, it is not just about issues such as climate change, but much more generally about promoting sustainable business models. Solutions already exist for many ecological problems - we want to invest in them. We are convinced that sustainable investments will generate higher returns in the future.

Lombard Odier is not only breaking new ground in sustainability. The Bank is now much more exposed to the public. Has discretion and secrecy become obsolete?

Transparency is more important today than ever. I am a great advocate of open communication. It also helps us to be attractive on the job market and attract young talent. The bank is growing strongly. Of the 2,400 employees, about half are work outside of Switzerland. We are present in 27 locations worldwide. So a change of mentality is definitely taking place. The fact that I was appointed partner as a former head of a major bank is certainly an expression of this.

How do you work with the six other partners? Is it more difficult to find a solution if someone does not decide alone?

In Sweden we are used to making decisions by consensus - so this is not a new situation for me. But of course, as CEO I used to be able to put together my own management team, while the personal chemistry between the partners is extremely important here. We work very closely together and meet at least once a week. Which I appreciate very much. As equal partners, we deal with entrepreneurial issues in much greater depth than I used to be able to. It is also satisfactory if, following an open discussion, we reach an convincing consensus solution where everyone agrees.

Annika Falkengren

With 43 Chairwoman of a major bank

In 1987, 56-year-old Annika Falkengren studied economics in Stockholm and joined the Swedish Scandinavian Enskilda Bank (SEB), where she initially worked in the commercial department. She was also a member of the Board of Directors of Volkswagen and the Munich Re insurance company. Last August, she moved as one of seven partners to the Geneva private bank Lombard Odier.

Lombard Odier with anewed self-confidence

Star architects build glass palace

The financial crisis and the end of banking secrecy have hit Geneva's private banks hard. But Lombard Odier has put these turbulences away surprisingly well. In the 222-year history, more than 40, often much more serious crises have already been overcome, says the oldest partner Patrick Odier confidently. Last year, the bank increased its client assets by CHF 41 billion to CHF 274 billion. In Asia in particular, the second major player among Geneva's private banks after Pictet sees great growth potential. The new spirit of optimism is also symbolized by the headquarters that Lombard Odier is building directly on the shores of Lake Geneva: The avant-garde glass palace of the star architects Herzog & de Meuron offers space for 2,600 employees and will open in 2021: "The self-conception of a bank can no longer be reflected in a stone bunker," the architects explain their light-flooded building.

This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter "Lombard Odier"). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document.

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