David Clarke CFA, who helped author the recent report, The Value of the Investment Profession, with CFA UK chief executive Will Goodhart, reflects on his surprise at the enthusiasm within the industry for the venture.
David Clarke, CFA
I’ve been involved with the investment profession and industry for about sixteen years, so I like to think I know a bit about how those inside it work, react and think. us, when Will Goodhart, chief executive, asked me to help out on this report – one that was to kick start a new venture in engagement and advocacy for the society, showing just how much we bene t the community and individuals – I thought we’d get the cooperation of companies and individuals, but only up to a point. More specially I assumed we’d get an enthusiastic response from the PR, sales and marketing sides of the companies from which we were asking for help, those who are used to presenting what they do to the outside world, but that senior executives and fund managers, those at the coal face, would be less inclined to help. Not out of any malice mind you, but just that there were other, more important, things to do.
Where did my prejudice come from? In my days as a journalist at Bloomberg I’d got used to fund managers telling me that they’d love to talk to me, but that their focus remained on the ‘day job’. What they meant by that was that talking and communicating was one thing but that when the chips were down, their primary focus had to be managing the funds under their care – a fine aspiration, but not one that suits today’s increasingly knowledge-hungry, and doubting, society. ere was a spectrum: even among those who liked to talk about what they did, it was felt that communicating, explaining and justifying was secondary. At the other extreme it often struck me that some in the industry thought what they were doing was so evidently beneficial that it didn’t need explanation or defence.
Thus, in advance of this research, I fully expected to be told that there were other more important things to be done.
I couldn’t have been more wrong. e enthusiasm was palpable. From the biggest multi-billion pound manager through to smaller start-ups, the response was the same – “this is a great idea, it’s about time someone tried to explain what we did, and how can we help further this cause?”
Why the change in attitude? (I really do believe that had we tried a similar endeavour when I started out in 2000 the reaction would have been very different.) e answer is straightforward. The financial crisis happened. at’s not to say that the fund management industry felt responsible for this, nor should it (although some of the commentators we spoke to during the project did think we could have done more to avert it). But since 2008, it’s become increasingly clear to all of us within the financial industry that we operate on licence and not of right. Society allows us to sell our wares and o er our services because it believes that we add to the greater good by doing so. If that were to change, our ability to operate would be curtailed.
