News & Views

Now is the time to generate greater enthusiasm for the British market, not only by showcasing it on the world stage, but by enabling and empowering individuals across the UK to invest in it, become engaged with it and thereby igniting greater entrepreneurial activity. Here are some of my thoughts as to how.

This year is quickly defining itself as a year of change. Whichever way you look there is a lot going on. There are multiple conflicts around the world, general elections looming in the UK and the United States, and whatever the outcome of both those events alone, change is the only guarantee, which is both an exciting and a disconcerting prospect. 

On a financial score, while inflation is slowly creeping back to the Bank of England's target of 2%, which for all intents and purposes is something to be pleased about, the benefits are not yet reflected in the experiences of individuals and businesses on the ground. Like something of a turning ship, in many ways people are feeling the remaining turbulence of its wake.

Within that context, the role of the City is pivotal in helping to calm the waters and nurture a rising tide. Those who work to enhance the competitiveness of the City of London, do so for and with a duty to and responsibility for the economic prosperity of the nation. 

It is a duty and responsibility I take very seriously, and many people have done wonderful things to contribute to that endeavour. They include, but are not limited to the current Lord Mayor and those that went before him, the City's Sheriffs past and present, other and previous Aldermen and women, and all those who proactively work in, for and on behalf of the City. 

In my roles, now and going forward, I seek to build on what has gone before, and I wanted to take a moment to discuss what that looks like in action.

Enthusiasm for British markets 

It is over 30 years since I started work in investment management in the City. In that time, I have seen numerous crises - you may have heard the well-known saying that the stock market climbs a wall of worry, which is as true today as ever. Despite the challenges, for more than 1,000 years, the City has continued to grow, thrive and prosper, and I am confident that with continued diligence and determination we can maintain an upwards trajectory.

However, that growth cannot be achieved separately to the prosperity of people across the nation. I believe it is our role within the City to equip, enable, empower and release people and businesses for the economy to fulfil its potential. To my mind, there are key economic and trade priorities that need to be focused on in order to achieve that.

Crucially, it's about generating enthusiasm, not just for the British market, but for investing, education and to get some of the UK's economic power back. While the powers that be are integral to that process, it's essential that we get the average person engaging with British companies, increasing awareness, entrepreneurial activity and addressing some of the challenges I have written about before - not least the UK savings ratio.

Safety in numbers 

Firstly, I think it's important to recognise that our processes have, with best intentions, removed risk from the financial system. However, as Bim Afolami MP, Economic Secretary to the Treasury and City Minister recently observed, “There is no point having the safest graveyard.” 

I think we need to acknowledge that  risk is a fact of life, and, particularly in financial markets, risk is not something to be fearful of because it is through navigating it successfully that we find growth. Within that, I think we need to give businesses and individuals the freedom to accept and manage risk to unleash growth and entrepreneurial spirit from the institutional level and extend it to the end consumer.

London on the world stage 

I have had the privilege of living overseas, as well as spending 30 years running global multi-asset portfolios for international clients. I am therefore acutely aware of the advantages we have in London as a global finance, investment and professional services centre. I would like to see us drive home these advantages.

Last year I worked with the Sovereign Wealth Fund Institute to bring $5+ trillion assets under management (AUM) into Guildhall for their first global conference. This was a strong and clear endorsement of the City, the UK, our rule of law and the depth of professional talent that exists here. New business opportunities arose from it and I am confident will arise from this year’s event as well.

Similarly, this year I co-hosted the Canadian Indigenous Investment Summit at Mansion House. It was an endorsement of our historic links to Commonwealth countries and our impact investment sector. As part of the event I welcomed four Canadian indigenous chiefs, arranged the Freedom of the City for them, and underlined our diverse and inclusive culture.

I believe in the importance of representing the UK in overseas markets and showcasing London's many assets as the global centre of excellence for financial and professional services. In turn, this should be done to help create pathways for businesses that seek to develop their global reach.

Investing begins at home 

There have been many important initiatives that I think must be continued and built upon. For example, Lord Hill’s UK Listings Review, The Edinburgh Reforms, Douglas Flint’s Digitisation Taskforce, and the Mansion House Compact, all stand out together with that risk agenda for UK AUM growth.

It's important to remember that the AUM managed in the UK is about four times greater than the size of our domestic stock market, and that 80% of the FTSE’s earnings are derived from overseas. In short, we have global reach and connections that are second to none. 

However, we want to see a return to and growth in the London Stock Exchange as a proportion of global public markets and at the same time facilitate growth in, and access to, private assets and impact investment growth areas that will result in the AUM in the UK increasing.

Remembering who we work for 

Ultimately, markets, capitalism and the City are about enabling the flourishing of humanity in the round, not piling up pound coins.

At the end of the string of transactions that any of us is involved with there is an individual and we are here to serve them. What we do in the Square Mile is for individuals up and down the country, who are saving for a new car or kitchen, a well-earned holiday or a much-deserved retirement.

However, the stats are sobering. For example, the UK has a savings rate of just 1.7%, one of the lowest in the OECD, nine million adults in this country have no savings and 11.5 million have less than £100 in their account. Research from Moneybox found that only 26% of people invested in the markets in 2023, with 36% saying they simply could not afford to - citing the cost of doing investment as a barrier.

I have written before about the advice gap - the cost of advice, the confusion people face about investment, and the lack of incentive to do so - this needs addressing. While there have been rumblings about the proposed British ISA and some push back on that score, it is important to start somewhere and give people education and options to get involved in the markets.

The trusty Post Office savings account books that many of us put our pocket money into as children are no longer available and there's now no equivalent, trusted institution where people can go with modest sums and learn the art of saving from an early age.

Inspired by the National Employment Savings Trust (NEST), with its 13 million members and £39 billion in assets, I think we should be galvanised into action to improve the financial health of the nation, close the advice gap and provide a trusted route for all to save and invest.

As things stand, the UK market looks undervalued, but I would rather put money into an undervalued market than an overvalued one. Now is the moment for putting our individual and collective time, treasure and talent towards the health of the nation and its economy, remembering John Wesley's famous exhortation that one should "earn all you can, save all you can, and give all you can." I believe that in this we find not simply our jobs within the City, but our purpose as well.