I am currently in the midst of reading Prof Raghuram Rajan’s Fault Lines, an incisive analysis on the various forces that combined to create the perfect storm that was (and still is) the Global Financial Crisis. This happens to be a timely read as I contemplate the upcoming Global Leadership Summit, which will discuss the Future of Leadership: Beyond Villians, Heroes and Scapegoats. I am particularly looking forward to the panel discussion on ‘The Future of Financial Leadership’ – speakers include senior banking executives such as Tim Breedon and Alessandro Profumo, bigwigs in the regulatory space including Martin Wheatley and ex-central bankers such as Lucrezia Reichlin. I hope some of the following themes are brought up and discussed during the Summit:
The Role of Politics & Ideology in Economic Policy: In developing countries, it is explicitly acknowledged that politics play a major role in economic policy. This might be in the form of nationalised firms, particularly in infrastructure and utility sectors, or trade tariffs, subsidies or duty. These countries and their industries accordingly face an additional cost of capital in the form of ‘country risk premium’. However, the financial crisis was an example of how the economic policies in the West too are deeply entrenched in the politics of the respective countries. In the run up to the crisis, central banks and regulators made policies which synced with, rather than checked, the political agenda of the day, whether it was easy credit to ease the pains of unemployment or premium grading of sub-prime loan portfolios. The role of politics in ALL economics, irrespective of the stage of economic development of the countries, needs to be understood and discussed thoroughly.
Consumer Financial Literacy: Not to let the banking sector, regulators or the government off the hook, but there needs to be a discussion on addressing consumer behaviour, which is driven off some basic financial literacy. While central bankers expect that low interest rates stimulate increased consumption and decreased savings, nobody probably foresaw the circumstance which the mortgage crisis illuminated – not only were retail borrowers not saving enough, they were often borrowing over and over again against the same asset, based on the belief that property values would continue to appreciate as they always did. It is striking that five years into the crisis, there still is not a private or public body (of scale) looking into addressing the asymmetry of knowledge between the industry and the average consumer.
Incentives for the Financial Sector: It has become fashionable these days to focus on the top 1% of the finance sector and blame them for the woes of the wider public. Particularly in Europe, the lynching of bankers and their bonuses has been a relentless spectacle over the past few years, resulting in frankly impossible-to-implement policies such as caps on banker bonuses. However, it is time to investigate the broader context in which these actors played out their lives and ask whether anybody else in their situation would have done any better. Bankers, traders, hedge fund managers, everyone acted as per the theory of self-interest so well-espoused in economic theories, the broader result of which is supposed to be efficient markets and correct prices. For all the upside that professionals in this sector are exposed to, perhaps incentives and disincentives could be set so they feel the pain of the shareholders too. Such measures need to come not just in the form of increased regulation and reporting requirements (Basel III, ICBC etc), but also a fundamental shift in the industry’s culture and values, as reflected in its recruitment, training and progression.
I was recently travelling in Southern Africa. I was primarily there to attend a component of our MBA programme, called the Global Business Experiences. My article on this week in Johannesburg is published here on The Independent’s MBA Blog – the word limit gave me little room to gush over the whole experience but I hope to come back to the blog to elaborate further on the trip and my experience in the region!
I realised quite recently that I have been eerily quiet on this front about the fact that I have been on my MBA journey since last August, almost as if I am trying to avoid the topic. Which I am not, by any measure. It is just that the experience has been all-consuming and so involving, the way I have chosen to undertake it, that it has been hard for me to step away from it and state a few words about it. I still hope to do this over the next few weeks, particularly to address an area that I have discussed at length with various classmates, admits, potential applicants etc – Why do an MBA? Is it always sensible? Is it relevant anymore? And the most tricky question of all – is it a good investment of your time and money? But that’s for another day.
Before that, might I alert you to a venture that has been most interesting and novel at the same time – my most unusual summer internship, for which I have teamed with 5 of my MBA classmates and set up a full-time strategy consulting firm for the summer. This is a concept unique to London Business School, now in its 11th year, and it is an excellent training in entrepreneurship and consulting and everything in between – pitching, sales, negotiations, presentations, client management et al. Furthermore, it is not everyday that you get to add value to established businesses who have such excellent infrastructure within. Past teams have worked with awesome brands such as Johnson & Johnson, Roche, BP, Allianz, BT, LinkedIn, UBS, Virgin, Heinz, Hertz and many more. We have signed on interesting clients this year but we still have some capacity to fill for the rest of the summer so do look us up. Our projects tend to be priced between £15,000 – £50,000 – aka, we are a bunch of professionals with some formidable consulting and professional services experience within our group, not a student outfit looking to gain experience for free. I have to state this bluntly to ensure the discussion starts off on the right note
Here are some details:
Team Brochure: Here - note that we operate under the LBS brand and are well supported by the school and therefore benefit extensively from access to rich databases, alumni, faculty et al. We also receive some excellent advice and mentorship from a top-tier strategy consulting firm. Trust me, you would be paying significant premium for such resources at any other point of time. After all, we do call ourselves ‘Tomorrow’s Strategy Consultants, Today.
Website: http://summerconsultingteam.com/ (put up by yours truly, quick and dirty, in true start-up fashion, so do reserve your judgement :D)
Team Mascot/Maverick/Jester: Here - really, what else did you expect?
Do note that we don’t exclusively work on UK projects; we are able and willing to travel internationally for projects.
…and damned if we don’t.
For decades, the society at large cried itself hoarse about the myriad reasons why women were not suitable to break the glass ceiling in the corporate world – not qualified enough, not driven enough, not willing to put in the hours, going for the ‘wrong’ sorts of jobs, not quantitative enough in our skill set. And then our generation of women ticks off all the right boxes as we go along.
And apparently, now the problem is that we do not take enough breaks or learn to relax. The article states:
Today, 53% of corporate entry-level jobs are held by women, a percentage that drops to 37% for mid-management roles and 26% for vice presidents and senior managers, according to McKinsey research.
And then promptly goes on to blame women for not sorting their lives out. I do not debate the fact that my generation of women drives itself hard – God knows this is true, as I sit up at 1.33am rushing this post to get back to YET another case competition during my MBA which is littered with numerous examples of me taking on way more than I need to. What I do take offense to is that we get no credit for it, and are instead punished for it. Has the author considered the fact that there could be larger forces at play here, possibly even the same ones which have kept women out of boardrooms and executive management since time immemorial? It’s hardly like women were placed equally with men and then the Millennial women came along and spoilt it all!
Honestly, some days, I wonder if I should spare myself all this angst and turn housewife and watch daytime TV. But I’m too much of a Millennial woman and Type A for that. I’m seeing this fight through, and making my best attempt at breaking that ceiling – wish me luck! The ceiling is yet to be fully defined, but I’ll get there…
But seriously, since when have the promotion decisions included factors like ‘taking a break for personal reasons’, ‘going for a walk’ or ‘to go out for a lunch’? I continue to be baffled.
My credit card had recently expired and WordPress emailed me to let me know that I would need to update the details to renew my domain registration. And that’s when it hit me how long it had been since my last proper post on this blog. That is not to say that this is a proper post. Just a quick note to mention that I have also started writing on the LBS blog and I have, therefore, yet another excuse for the lack of updates here
…was an enormous success, by any standards. Two weddings. Eight events. Three cities. Friends who flew in from around the world. We didn’t hold back.
And the web community would be mighty proud at the wedding blog I put together – looks like I have picked up a thing or two from all those start-up events, after all
Skipped honeymoon to head right back to London to start this. My life never ceases to be exciting
…but in the midst of planning a rather big, fat Konkani-Hindu & Malayalee-Christian wedding thingamajig…two weddings, three cities, eight events and a bridal trosseau that takes my breath away every time I think about it.
Wedding(s) in two weeks – I am sure you will excuse my absence here, meanwhile
Oh, and wedding gifts here, please