Rethink perspectives: our view of a changing world

More than 200 guests gathered in London on 16 November at two events to debate our economic and investment outlook and the value of investing for environmental and social impact.

The presentations and panel discussions took place over breakfast and lunch at the prestigious Berkeley hotel in Mayfair. Guests gathered to hear ‘our views of the world and how to take advantage of them’ from chief economist Samy Chaar, followed by a panel debate chaired by Duncan MacIntyre, chief executive of our UK private bank, and featuring Bertrand Gacon, head of our Impact Office; Smiti Nigam, a product specialist in our insurance-linked securities team; and private equity expert Julia Lundström.

Managing Partner Frédéric Rochat opened the event by discussing our long heritage of rethinking investing, and how Alexandre Lombard made one of our first responsible equity recommendations back in 1851, when he advised clients against investing in stocks from southern US companies relying on slave labour. Samy Chaar then presented our economic and investment outlook, concluding that despite high valuations, a changing tone by central banks and an extended bull market in the US, we believe investors shouldn’t yet run for the hills. He noted that in years to come, investors should expect lower returns than in the past 15 years, and described how we have changed our strategic asset allocation to reflect these trends.

Our panel discussion focused on how we are responding to rising demand for investments to drive positive global change. Bertrand Gacon talked about approaches to either ‘financing the green’ (direct investments in green infrastructure/services) or ‘greening finance’ (measuring the green impact of ‘normal’ investments). Smiti Nigam explained how catastrophe bonds work and the attractions of uncorrelated returns, before addressing misconceptions that such instruments profit from environmental disasters. Julia Lundström concluded by talking about private equity general and limited partners’ rising interest in portfolio companies’ environmental, social and governance (ESG) credentials.

Audience questions ensured a lively debate involving all four panellists. They ranged from whether socially responsible/impact investing involves sacrificing returns; whether an expansion of the industry increases the risk of ‘greenwashing’; whether ESG analysis considers companies’ employment policies (eg racial/gender diversity); and how the current high investor demand for yield has affected catastrophe bond returns. Macroeconomic questions treated subjects as diverse as the current political situation in Zimbabwe and South Africa; the impact of the forthcoming change in Federal Reserve chair; our views on cryptocurrencies and on the recent fall in US bank lending.

The ‘Rethink Perspectives’ events take place in London twice a year. We are currently considering topics for our next event, in Spring 2018.

Information Importante

Le présent document de marketing a été préparé par Lombard Odier (Europe) S.A., un établissement de crédit agréé et réglementé par la Commission de Surveillance du Secteur Financier (CSSF) au Luxembourg. La publication de document de marketing a été approuvée par chacune de ses succursales opérant dans les territoires mentionnés au bas de cette page (ci-après « Lombard Odier »).

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