Grit, Loyalty and Optimism are the Baron’s True North

David Thomson, quite possibly the richest man in Canada, finds value in art — and ice hockey

By TONY LENNOX

When the fans of the Winnipeg Jets ice hockey team sing the O Canada anthem before a game, the line “…with glowing hearts we see thee rise, the True North, strong and free”, the words “True North” get a deafening roar.

[caption id="attachment_22574" align="alignright" width="300"] David Thomson, Chairman, Thomson Reuters[/caption]

And with that, David Thomson — aka Baron Thomson of Fleet, reputedly the richest man in Canada — may feel a glow of satisfaction. The fans are showing reverence for True North Sports and Entertainment Ltd, the company Thomson founded with businessman Mark Chipman.

Chipman, who had revived the team in 2011, paired well with the polymath Thomson, media mogul and chairman of Thomson Reuters. Baron Thomson of Fleet, to use that alluring and imperious title in context, heads a vast international empire that inherited from his father Kenneth (the second baronet, who died in 2006). Thomson junior is a renowned patron of the arts, a collector with a passion for ice hockey. He owns and runs a major real estate business, and thrives on competition. As he once put it: “I’m a very competitive individual and I play a part in a very large picture — and hopefully add value to people’s lives.”

The people of the prairie city of Winnipeg, despite being starved of sporting success for decades, continue to bellow their gratitude at home games in the 15,000-seat stadium and sports complex built on Thomson-owned land in the heart of the city.

At the age of 65, David Thomson remains a private individual who rarely gives interviews. When he and Chipman announced the revival of the Jets and the National Hockey League (NHL) franchise award, he was cornered by a Winnipeg Sun reporter hoping for a scoop. The tall and reclusive Thomson was courteous but typically taciturn. He was finally drawn to observe: “When you do things for the right reasons, everything else seems to flow.

“The best thing in life is that things evolve, and who would have imagined a confluence of circumstances that suddenly there’s an opportunity, and it makes sense? It’s the right thing to do. I’m just delighted to play a part.”

David Thomson was born in Toronto in 1957, the eldest of Kenneth and Marilyn Thomson’s three children. He and his family lived in London during the Swinging Sixties. At his mother’s funeral in Toronto in 2017, Thomson recalled kite-flying kites in Hyde Park and excursions to Portobello market. He returned to England after his schooling in Toronto, earning an MA from Cambridge University.

He was always aware of his responsibility to the family newspaper business, founded by grandfather Roy, on whose shoulders the hereditary peerage was lain. David worked in junior positions before taking a managerial role at the family-owned Hudson Bay Company. He was appointed chairman of the Thomson Corporation in 2002.

Thomson inherited a love of art from his father, and has a 2,000-piece private collection, including works by Picasso, Rembrandt, Turner, Constable and Rubens. It also features mediaeval sculpture and Inuit art, some of which is displayed at the Art Gallery of Ontario. He has donated more than $276m for the gallery’s renovation.

David Thomson has six children from four partners but lives alone in Toronto; he still owns properties in London. According to Forbes — on whose billionaires list he ranks 26th — his net worth is around $50bn.

The Thomson Reuters media conglomerate was formed when the Thomson Corporation acquired British news group Reuters in 2008. David Thomson maintains active involvement, and even writes the occasional piece for the Toronto-based Globe and Mail.

Competitive he may be, but loyalty and optimism are perhaps stronger driving forces for Thomson. Reflecting on his passion for ice hockey, he recalled a game he watched with his father. Their team was 6-0 down in the third quarter and fans were leaving, but the Thomsons stayed to the bitter end. “I sat there looking at him, and not the game,” David recalled, “realising I had to be the luckiest human being on earth.”


Jensen Huang: Is the Matrix already here?

Nvidia CEO and founder Jensen Huang sees the world differently — and believes we soon will, too. Report by TONY LENNOX.

[caption id="attachment_22581" align="alignleft" width="300"] Jensen Huang, Nvidia CEO. Photo: nvidia.corporation, CC BY-SA 2.0, via Wikimedia Commons[/caption]

Fortune-tellers are old hat. If you want to know about the future, listen to Jensen Huang, the flamboyant chief executive of the Nvidia Corporation.

Silicon Valley has always been pushing the frontiers of science — and the progress of AI is stunning, says the 59-year-old Taiwanese-American billionaire. Jen-Hsun Huang, to use the traditional spelling of his name, believes scientific advances of great magnitude are about to forever change the world.

“AI has jumped to warp speed,” he says. “It is racing in every direction; communications, architecture, learning strategies, new industries, all at the same time. It is the most powerful technological force of our time. For the first time a computer can write software by itself, that no human can, and achieve results that are quite spectacular.”

Nvidia, the company Huang founded in 1993, is at the forefront of this revolution, and the man himself is, according to colleagues and competitors, a visionary. His personal wealth is estimated to be more than $5bn, but he lives relatively modestly. He drives a Tesla, prefers a leather jacket to a business suit, and sports a tattoo of the Nvidia logo on bicep.

The professional respect Huang has earned has a lot to do with his foresight. He has anticipated the winds of change in the fast-moving world of hi-tech, and created the most valuable computer chip company on the planet.

Jen-Hsun Huang was born in a small coastal town in Taiwan in 1963. When he was nine, his family moved to Oneida, in Kentucky, where he anglicised his name and attended a local Baptist School. His teachers were astonished by his intelligence and work ethic.

The family later moved to Portland on the west coast, where Huang attended high school before studying electrical engineering at Oregon State University. It was here that he met his future wife, Lori; they have two children. Huang went on to earn a Master’s from Stanford University — and years later, donated $30m to build the Jen-Hsun Huang School of Engineering Centre.

In Silicon Valley, he worked first for LSI Logic, a micro-processor business, before joining computer components firm AMD. In 1993, he founded Nvidia. His single-minded approach to business is illustrated by his insistence that the new company concentrate on a niche market — building computer chips to create stunning graphics for video games.

When Nvidia went public in 1999, he recognised an opportunity to take the company in a different direction. The firm began creating chips to support AI applications for autonomous vehicles, robotics, drones and other hi-tech tools.

Under his leadership, the company grew — despite the occasional set-back. At the height of the 2008 economic downturn, he famously reduced his own salary to one dollar. The company survived and flourished through acquisition and expansion. In 1999, Jensen Huang was named Entrepreneur of the Year, and in 2019, best-performing CEO in the US. In 2018 Time magazine included him in its list of the 100 most influential people on the planet.

Huang’s vision of an AI future began with his determination to create the “brain” for fully autonomous vehicles. He quickly built relationships with some of the biggest automobile companies in the world, including Audi, Mercedes-Benz, Jaguar Land Rover and Toyota, among others. But his ambitions go further: he wants to bring AI to “everything with an on-switch”.

Nvidia hosts an annual GPU Technology Conference, and Huang, in a video presentation for the event, spoke enthusiastically about the Omniverse. This ambitious project is to create a detailed virtual world “down to grassroots level” where new tech can be tested.

Nvidia CEO Jensen Huang believes that creating a digital copy of the planet will provide simulation capabilities for industry, city planning, and autonomous machines — a practice ground for robots and humans which, he believes, will improve our experience of the world.

“Within 10 years, you won’t be able to tell the difference between the real world and the virtual reality world,” he predicts.

The Matrix may be here sooner than we think.

[embed]https://www.youtube.com/watch?v=eAn_oiZwUXA[/embed]


Uncertainty is the Only Certainty for BlackRock Founder Larry Fink — but his Outlook is still Positive

Kind-hearted, controversial, keen on going green: the billionaire Larry Fink champions worthy causes without fear or favour

By TONY LENNOX

It’s no irony that Manhattan-based billionaire Laurence “Larry” Fink is involved in a charity named after the legendary folk hero who stole from the rich and gave to the poor.

The Robin Hood Foundation was set up by a group of New York hedge fund managers in the 1980s to alleviate poverty in the city. Larry Fink, the 69-year-old CEO of Blackrock — the largest money-management firm in the world — firmly believes in corporate capitalism as a force for good.

[caption id="attachment_22833" align="alignleft" width="400"] Larry Fink, Blackrock CEO[/caption]

The calm, bespectacled Fink is seen as one of the business world’s natural leaders, but his frank (and sometimes controversial) opinions on business and politics frequently cause ripples. Every year, he writes an open letter to the business leaders in whose companies BlackRock clients invest their cash. Its contents are always eagerly awaited, and closely scrutinised.

This March, Fink urged corporate America to commit to net-zero, a total eradication of its carbon footprint, by 2050. Crucially, he proposed how companies were to achieve that; otherwise, he warned, BlackRock might dump their stock. Many on the political right are alarmed by Fink’s opinions, and warn that the vigorous pursuit of environmental targets and “tree-hugging virtue-signalling” will harm the US economy. The Russia-Ukraine War has led to some backtracking on sustainable energy commitments, but Fink remains staunch. He argues that green investments generate superior outcomes.

In his open letter to CEOs, he wrote: “Recent events will actually accelerate the shift towards greener sources of energy in many parts of the world.” As an example, he singled out Germany’s plans to fast-track its use of renewable energy to achieve 100 percent clean power by 2035 — 15 years ahead of its pre-war target.

Larry Fink was born in Van Nuys, California in 1952, one of three children. His father ran a local shoe shop, his mother was an English professor. He gained a BA in Political Science from UCLA in 1974 and went on to earn an MBA in Real Estate at UCLA’s Anderson Graduate School of Management.

He has been married to his wife Lori since 1974, and owns homes in Manhattan, North Salem, New York and Vail, Colorado. The couple have three children. Fink is a lifelong supporter of the Democratic Party.

His first job was as a trader with New York investment bank First Boston. For many years he added to the company’s bottom line, but in 1986 — largely due to his miscalculation of predicted interest-rate changes — his department lost $100m. This led Fink to reconsider his career direction.

In 1988, under the corporate umbrella of The Blackstone Group, Fink co-founded BlackRock — a business which, under his stewardship, has become the world’s leading investment management company.

Fink is ranked 28th on the Forbes’ list of the world’s most powerful people. His net worth is estimated at $1bn. He serves on the World Economic Forum, is on the board of the Council on Foreign Relations, and the International Rescue Committee. Fortune classifies him as one of the world’s greatest leaders, and his name has been on the list of the world’s best CEOs for 15 consecutive years.

He is vocal about issues such as diversity and inclusivity in the workplace, and has always ensured BlackRock’s commitment to ESG criteria. In his 2020 open letter to the leaders of industry and commerce, he announced that environmental sustainability was crucial to BlackRock’s future investments.

In a recent television interview, Larry Fink was asked his opinion of the turbulent economic conditions. While agreeing that the world was going through difficult times, due to inflation, the conflict in Ukraine, and energy shortages, he didn’t necessarily agree that an economic storm was on the horizon. He predicted that “we’ll muddle along” for the next year or two, but added: “One thing I can say with total certainty is that we’re going to be living with more uncertainty.”


Michael Saylor: How to Make Money with Bitcoin

Michael Saylor: Bitcoin is the family farm. Don’t panic!

BY TONY LENNOX

Michael Saylor describes his journey to bitcoin legend status as an accident. “I kind of fell off the turnip truck and hit my head on a pot of gold,” he says.

[caption id="attachment_22847" align="alignleft" width="300"] Michael Saylor, MicroStrategy CEO. Photo: michael.com[/caption]

The 57 year old founder and CEO of MicroStrategy, a business analytics software firm based on the edge of Washington DC, enjoys mid-western farming analogies. Indeed, he often refers to ownership of bitcoin as “the family farm” – something you should never sell.

He was born in the heart of the mid-west, in the prairie state of Nebraska. His father was a master sergeant in the US air force, so the young Saylor spent his early years in military air bases across the world before the family finally settled in Fairborn, Ohio.

In his final year at high school in Fairborn he was named “the pupil most likely to succeed” – but succeed at what?  “I wanted to be a rock ‘n’ roll star,” he says. “When I was in college I wanted to be a fighter pilot, but those hopes were dashed. My third idea was to be a professor.”

His ambition to fly jets, even become an astronaut, were scuppered when he was wrongly diagnosed with a benign heart murmur. At that time he was an MIT student on an air force scholarship, and he gained a double major in aeronautics and astronautics.

Needing money to pursue his third ambition of a professorship, Saylor got a job building computer simulations for DuPont, the biotechnology giant. When he handed in his resignation in order to go back to MIT his bosses, who’d come to depend on his genius, begged him to stay.

“I was 24 and living in an apartment with milk crates for bookshelves,” he says. “I didn’t want to stay and be a corporate bureaucrat.” DuPont offered him a pay rise, but Saylor told them he’d rather be the CEO of his own company – so on the promise to complete his DuPont projects, the company helped him set up his own business, MicroStrategy.

Within a few years Michael Saylor was a billionaire, riding the dot-com bubble. When the bubble burst in the late 1990s his fortunes crashed with it. The company survived, however, and he regained his billionaire status thanks largely to his timely bitcoin investments, personally buying 17,732 bitcoins for $175m.

Over the following years he gradually steered MicroStrategy’s coffers into bitcoin, and helped trigger the institutional bitcoin boom. In 2020 MicroStrategy’s bitcoin ownership crossed the $1b milestone.

The cryptocurrency market suffered what observers called a “meltdown” in May, 2022; the start of a “crypto winter”, blamed on macroeconomic and geopolitical turmoil, but Saylor was typically blunt about those who rushed to sell bitcoin.

In a television interview earlier this year, he said: “Do not sell your bitcoin.” One of his biggest regrets as an investor, he said, was “finding a really good idea and underinvesting in it”.

He added: “A digital monopoly that changes the world is a good idea. But people panic - and sell. When you do that, you regret it. He urged bitcoin investors to remember the words written by Douglas Adams on the back cover of The Hitchhiker’s Guide to the Galaxy – Don’t Panic. “Bitcoin is something you can trust - across borders, across time, across cultures - and that is such a precious thing,” he said. “It is a paradigm shift, neutral, ethically sound, non-sovereign - a technically secure monetary network which allows no-one to victimise anyone else. It is also functional and progressive.”

Saylor, who has never married, and lives alone in Vienna, Virginia, has said he may step down as CEO after 30 years leading the business, though will remain executive chairman, and will continue to serve on the bitcoin mining council, the global forum of bitcoin miners.

A school friend remembers Michael Saylor as a young man buzzing with ideas, but who was essentially “just a quiet mid-western guy”. He has always been a voracious reader, fascinated by scientific advances that changed the world - the printing press, railways, the telephone, genetics, antibiotics.

He says: “The impact of all these things changed the paradigms of society. People are capable of accomplishing great things if they set their minds to it. We should not allow ourselves to be hijacked by a small goal or a pedestrian thought.


How Bernard Arnault Turned One Franc Into a Dynasty

French billionaire Bernard Arnault’s off-beat approach to business would be hard to replicate

By KITTY WENHAM

[caption id="attachment_22885" align="alignright" width="400"] Bernard Arnault, CEO LVMH. Photo: Jérémy Barande / Ecole polytechnique Université Paris-Saclay[/caption]

It started with one franc, one small acquisition. In 1984, Bernard Arnault purchased an almost-bankrupt textile company by the name of Boussac for one French franc. In just a few decades, he turned it into one of the most successful conglomerates in the world. Arnault is today the CEO of LVMH (Moët Hennessy Louis Vuitton) and battles with Amazon CEO Jeff Bezos for the title of the richest man in the world with a net worth of $125bn.

Unlike Jeff Bezos, Bill Gates, or Elon Musk, most people have never heard of Arnault. Tall and slim, he cuts a suave but unassuming figure in his uniform of a navy suit and dark tie. “All I am interested in is promoting my brands, never myself,” he once said.

Arnault was born in the rust-belt industrial region of Roubaix, France, in 1949. He was educated at the elite Ecole Polytechnique in the 1970s and began his career as an engineer working for his father’s construction company. By the time he was 25, he was given the keys to the kingdom, which at the time employed 1,000 people. Arnault shifted the focus of the family company to investing in US real estate.

In 1984, when Arnault was 34, he paid that symbolic franc for a failing textile company. The company, Boussac, had something Arnault saw as an undervalued gem: Dior. After the death of its founder, Christian Dior, in 1957, the fashion house had struggled to hold its own. It became known less for revolutionising 1940s womenswear, and more for producing safe, conservative options French ladies could wear to lunch. Arnault was already familiar with the brand — his mother had been a particular fan — but he has noted being struck by a conversation with a New York taxi driver. Arnault recalls "He could not name the president [of France], but he knew Dior.”

Soon after acquiring the company, Arnault would go on to buy Celine and Christian Lacroix. In 1989, he became a majority shareholder of LVMH; a merger between Louis Vuitton and drinks company Moët Hennessy. His ousting of Louis Vuitton president Henri Racamier from his family company earned Arnault the nickname “The Wolf in Cashmere”. Around a decade ago, LVMH began amassing shares in the luxury bags and accessories company Hermès — while finding ways to stay below disclosure thresholds. LVMH managed to amass a 17 percent share-hold in the company before the Dumas family realised what was happening. The heirs to the Hermès company declared his actions a “corporate assault”. Although LVMH maintained it had no plan to take control, Hermès mounted a court case against the conglomerate. Arnault was forced to sell his shares.

His all-American tactic of ousting founders or partners from dormant family brands, which he then revives into global household names, may be ruthless — but it is successful.

Arnault's holding company, LVMH, now oversees 79 brands, from Italian jeweller Bulgari to Givenchy and Fendi, Tiffany’s, and luxury travel brands such as the Belmond hotel group and the Orient Express train line. Under his leadership, LVMH profits have soared by 500 percent, with shareholders enjoying a 14 percent return compared with a global average of three percent. In 2021, LVMH sales reached more than three times the numbers of its biggest rival, Kering.

“I’ve always liked being number one,” he has admitted, and Vogue editor Anna Wintour has joked that Bernard Arnault “doesn’t like to hear the word ‘no'." Rumours suggest he prowls his retail stores every Saturday morning, rearranging bags, taking note of stock, giving advice to store managers, and visiting competitors. To Arnault, image is everything. In 2018, he is said to have closed a shop in Fort Lauderdale because the surrounding businesses were not up to his standard.

“I’m not that interested in the numbers of the next six months,” he once said. “What I am interested in is that the desire for the brand will be the same in 10 years as it is today.”

As for the future, more of the same apparently awaits Arnault. While he may be known as a champion of creative freedom, thoughtless risks are not his style. He has dismissed rumours of more potential acquisitions. Unlike many in the fashion world, he remains sceptical of the newest wave of metaverse fashion releases.  “We exist in the real world, and we sell real products,” he said. “Our goal isn't selling virtual sneakers for €10 a pair”. A dig, perhaps, at Kering, which launched its own Gucci NFT sneakers for $12 a pair. Arnault prefers to focus on technological advances with real-world, and profitable, capabilities. In 2021, LVMH partnered with Google Cloud. This alliance will allow LVMH to use an AI system with access to trillions of pieces of personal data. That power could be used for everything from trend forecasting to personalised offers.

It seems clear that the Wolf in Cashmere isn’t going anywhere. LVMH has voted to raise the age limit for the position of chief executive to 80. The decision ensures Bernard Arnault can serve another two terms at the helm of the luxury goods conglomerate. All five of his children own part of majority shares in LVMH and work across the company — but no obvious heir has emerged. With business booming and a new personal data mine to rival Amazon’s, there is perhaps no rush.


UAE’s Economic Progress to Extend Beyond Post-Oil Era

Nearly seven years ago, President His Highness Sheikh Mohamed bin Zayed Al Nahyan provided a glimpse of what the future holds for the UAE.

[caption id="attachment_22842" align="aligncenter" width="900"] UAE: Dubai[/caption]

“In 50 years, when we might have the last barrel of oil, the question is: When it is shipped abroad, will we be sad?” he asked the crowd of the 2015 World Government Summit. “If we are investing today in the right sectors, I can tell you we will celebrate at that moment.”

That optimistic foresight has steered the country towards a more diversified economy that will deliver sustainable and inclusive growth. Far from pumping the last drop of oil, the UAE is well-placed as a model of economic development and stability as its economic diversification strategy gathers pace — especially in terms of foreign trade and industrial exports.

The federal government’s emphasis on supporting export has resulted in a historic rise in the UAE’s non-oil foreign trade, which reached $144bn by the end of the first quarter of 2022. Exports grew around 18 percent year-on-year to $24.7bn over the same period — doubling over five years — while non-oil imports grew 25 percent to $79.5bn.

But with the unstoppable drive to align with the Centennial 2071 plan to position the UAE as a leading global trading hub, the country will never rest on its laurels.

His Highness Sheikh Mohammed bin Rashid Al Maktoum, vice-president and prime minister of the UAE and Ruler of Dubai, said non-oil sectors contribute over 70 percent of the national economy, and the aim is to increase the UAE’s national exports by 50 percent over coming years.

“In the UAE,” he added, “we work as one team to boost our national economy and reinforce the UAE’s leading position.”

A Recipe for Success

Strengthening SMEs, which constitute around 94 percent of the UAE’s total businesses, is one of the key pillars of the quest to enhance the manufacturing and export sector.

But SMEs are highly vulnerable to any fluctuation in the marketplace, whether caused by the pandemic fallout, supply chain disruptions, or skyrocketing prices of raw materials and machinery.

According to data from the US Bureau of Labour Statistics, around 20 percent of small businesses won’t survive their first year, and 30 percent go to the wall by the end of the second. About half will have failed by the end of the fifth year, and only 30 percent will remain when a decade is over — a 70 percent failure rate.

So, how can SMEs be protected to navigate these challenges? How can new companies enter such a volatile marketplace? The greatest hardship most encounter in their operation cycle is the difficulty of obtaining finance. Banks and financial institutions are hesitant to lend to small businesses, considered risky due to their limited cash flow, low equity reserves, and high dependence on receivables.

The lack of adequate liquidity threatens the survival of a small business, and they are in a disadvantaged position in contrast with large firms. The situation worsens when collateral is required as a guarantee of repayment. Entrepreneurs may have no physical assets to offer, and bad credit — or lack of credit history —may lead to loan rejection.

SMEs have a tough time dealing with the increasing cost of materials and labour. While bigger competitors can alleviate the impact with their reserves, small businesses often find themselves running the risk of diminishing margins or losing their customer base — or both.

State-backed trade finance becomes significant at this juncture. Guarantees, export credit insurance and other trade finance support from the government equip SMEs to defend themselves against non-payment. These act as stimulus for bank lending and give businesses the confidence to extend credit to new and existing customers with better terms. This increases their competitiveness in domestic and international markets, enabling them to employ more people and enhance production and sales.

Emirati Success Stories

The launching of the UAE Federal export credit company, Etihad Credit Insurance, signifies the proactive vision of the UAE leaders in bolstering the national production capacity and export sector through a range of bespoke trade credit insurance and project-financing solutions. Many UAE companies have succeeded even in challenging economic cycles — protected by ECI guarantees.

Emirates Steel, part of the Arkan Group and the leading integrated steel plant in the Middle East, saw an almost 50 percent increase in its export markets across Europe, America, Asia, and the Middle East and North Africa over the past two years. The company’s expansion plans are aligned with the objectives of the UAE’s industrial strategy, Operation 300bn, which is poised to increase the contribution of the industrial sector to the country’s GDP from AED 133 billion ($32.61bn) to AED 300 billion ($81.68bn) by 2031.

Another beneficiary of ECI’s state-guaranteed support, RAK Ceramics, reported that its total revenue increased 21.8 percent to $780m. RAK Ceramics serves clients in 150 countries through hubs in Europe, the Middle East and North Africa, Asia, North and South America and Australia. ECI’s support in securing receivables helped RAK Ceramics to register an outstanding performance last year, despite rising input costs and supply chain disruptions.

Since the onset of the pandemic, the role of export credit agencies has increased to fill widening financing gaps left by the private market — especially in meeting the businesses’ short-term working capital needs. It’s common for trade- and export-related businesses to face finance issues due to increased costs of short-term financing and mounting rejection rates.

Government-backed ECAs have increased trade finance support to businesses. While the appetite for lending was low, ECAs filled that gap. Etihad Credit Insurance’s support to UAE exporters in the non-oil sector rose by 260 percent in 2021 to $4.9bn, compared to $1.36bn the previous year.

Protection against Default

In unfamiliar market territories, companies are at the risk of non-payment, through client bankruptcy or unforeseen commercial and political perils. Any little ripple in the global economy can spark adverse outcomes anywhere, at any time.

ECAs support protects the business community from going down this path. During the peak of Covid, Emirates Fiber — a subsidiary of the leading textile companies and a major exporter in the UAE Safetex —had been supplying its products to Hollander, the largest global producer of utility bedding products based in North America.

If Hollander were to go bankrupt, millions of dollars would be at stake. And unfortunately, the American company with over 100 years of history did just that. The $1m Safetex gave to Hollander’s open account seemed irretrievable — but the company was covered through a revolving limit by ECI. The firm jumped into action, working with legal partners in the US to secure part of the debt and ensuring the company was a secured creditor. Emirates Fiber was able to recover a substantial portion of the debt — and ECI indemnified the remaining unpaid balance.

As the CEO of Safetex Group said: “It could have been a huge setback, enough to make us go bust. That coverage from ECI saved us from an impending fall.”

Improving Lives

Public-private partnerships (PPP) were proposed by the United Nations as a tool for achieving its Sustainable Development Goals (SDGs). These provide the means and opportunity to stimulate the private sector to innovate and create effective solutions to infrastructure and service-related challenges.

As the UAE Federal export credit company, Etihad Credit Insurance’s support to various private entities underscores the country’s effort to foster PPP, especially following the economic challenges caused by the pandemic. ECI was involved in ambitious infrastructure projects that transformed millions of lives.

Last year, it collaborated with the Iraqi Ministry of Finance and global energy giant GE to complete the financial close of the Power Up Plan 4 (PUP4) to strengthen Iraq’s electricity sector. It was a landmark achievement for the UAE’s sustainability drive, where key stakeholders from government ministries joined with financial institutions, export credit agencies and commercial banks to power-up a nation, empower people, and unite industries.

ECI provides reinsurance coverage to JP Morgan, the lender in the project that will enable the production and reliable generation of up to 2.7 gigawatts of electricity for the Iraqi people. Just one megawatt can provide power to as many as 900 homes. Through the concerted efforts of governments and the private sector, the project can provide electricity to 2.5 million homes each year.

ECI and its Israeli counterpart, ASHRA, recently entered into a partnership to provide buyers’ credit guarantees to the funding bank for Ghana’s $147m healthcare project, the construction of four hospitals and the first main central medical storage facility in the country. The agreement is the first PPP project between the UAE and Israel since the signing of the historic Abraham Accords in 2020. It sets the stage for greater economic and trade collaboration following another historic milestone: the signing of the UAE-Israel Comprehensive Economic Partnership Agreement (CEPA).

So, in the post-pandemic era, UAE people and businesses are empowered to sell domestically made products around the world. Companies big and small have fewer concerns about access to the funds that can make their dreams true. Large-scale investments are promoted for enduring infrastructure development — clean energy or healthcare — to save, sustain and strengthen current and future generations.

About the Author

[caption id="attachment_22295" align="aligncenter" width="300"] Massimo Falcioni[/caption]

Sir Massimo Falcioni is CEO of Etihad Credit Insurance.


Melonee Wise, Robots Taking Over

Robots are here to stay, making life easier in many sectors — and Fetch Robotics founder Melonee Wise has been there from the start…

[caption id="attachment_22932" align="alignright" width="400"] Melonee Wise. Photo: Zebra Technologies[/caption]

Melonee Wise is a self-proclaimed “robot ninja”, and the nickname has caught on. Wise is a rock star in the robotics community.

She was head-hunted by Willow Garage, a now-defunct research-lab that Business Insider credits with jump-starting the race in computer vision, manipulation and autonomy. It spawned a range of applications for drones, autonomous cars and warehouse operations. Many members of the Willow Garage team went on to launch their own businesses after its billionaire “moon-shot” founder, Scott Hassan, decided to close operations.

Fetch Robotics

Wise became a serial entrepreneur. Within a year of Willow Garage’s shutdown, in late 2013, she launched Unbounded Robotics. By July of the following year, it had folded. Wise said complications in an agreement with Willow Garage stifled fundraising. Undaunted, she co-founded a pioneer of on-demand automation, Fetch Robotics. It presented the world with the first cloud robotics platform and contributed to robot operating systems still used today.

Wise has led with a focus on innovation and partnership. Over the past eight years, the company has developed a compelling cloud robotics platform. Robots have long been a mainstay in warehouse and fulfilment centres, and the pandemic proved the worth of the technologies. Fetch contributed robot “troops” for the fight against Covid: one innovation had a disinfecting spray, another featured UV light technology.

“Even before the pandemic became an issue, warehouses and distribution centres found it difficult to find human labour,” she said. “Now, some of these facilities are faced with the additional challenges of doing more with even fewer workers.”

Fetch Robotics has raised $94m in five funding rounds over five years. A 2019 series-C round led by Fort Ross Ventures netted $46m. It attracted four new investors — CEAS Investments, Redwood Technologies, TransLink Capital and Zebra Ventures — and retained four existing ones: O’Reilly AlphaTech Ventures, Shasta Ventures, Softbank Capital, and Sway Ventures.

Fetch joins Zebra

When Fetch started series-D fund-raising in 2021, it was offered a $305m acquisition deal by Zebra Technologies, a company building and delivering edge products that enable businesses to connect assets, data and people.

“We started working together through our partnership,” said Wise. “One of the first things we did was integrate their mobile computing devices for an out-of-the-box experience on our cloud robotics platform. Our customers … could take the hand scanner they already had, scan a barcode, and call a robot to them.”

Wise serves as the vice-president of Zebra’s robotics automation division, and Fetch will become the centrepiece of its new product offerings. “One of the other great things about Fetch joining Zebra is they have a strong go-to-market engine, and they can amplify our sales capability… It helps us reach a much broader, wider, and deeper audience.

“I think the acquisition made sense, because it aligns with our long-term vision. When we built our platform, we built it to be unifying. Not just our robots. Over the years we’ve been slowly bringing in other partners.

“We have a partnership with SICK, we have partnerships with other marketplace web service providers like VARGO. That isn’t going to change. We’re still going to be partner-friendly, and we’re still going to bring other devices into the ecosystem.”

AMR benefits

A study commissioned by Zebra Technologies found that 83 percent of warehouse associates believe autonomous mobile robots (AMRs) have increased productivity and saved time. Three-quarters report error reduction, while nearly two-thirds credit AMRs with providing career-advancement opportunities. Wise hails this as a win-win for the business, front-line teams, and customers.

“Robots are finding their place alongside people in many work environments, including factories, warehouses, retail stores and even hospitals,” Wise wrote in Robotics Business Review. “To optimise their effectiveness, increase human-robot collaboration, and reduce the risk of mishaps, AMRs must understand and take cues from the social behaviour of their human co-workers. Cloud-based technologies for deep learning training are key to making that happen.”

Past — and Future

Wise has had her work published in various industry journals, and she has been granted 18 patents. She was one of six robotics pioneers (and the only woman) to win an Engelberger award in 2022. It’s been compared to “a Nobel Prize of robotics”.

In June, she was elected to serve on the board of directors of Tailos, a company providing automated solutions for hospitality and industrial cleaning. It lets machines do the dull, dirty or dangerous tasks.

Tailos CEO Micah Green describes Melonee Wise as a “visionary and titan in robotics” with an “unparalleled passion for building robotics companies and supporting fellow roboticists on their journeys”.


Who’s the Richest man in the World?

Bezos edges to the front, but Musk comes around the outside, this pair fairly flying now, as Gates seems to drop off the pace as they come into the final furlong…

This ongoing fascination with the richest man in the world: Are we watching a keenly fought race to the pinnacle of human financial achievement, or an obscene farce played out against a backdrop of drought, disaster, and rising international poverty?

Richest man in the world, it's a tough question, and one perhaps best not examined too closely. We all know the field, though, stamping and puffing to get out of the starting gate and romp to the next billion. So, let’s start there. Gates. Bezos. Musk. Buffett. Arnault. We feel we almost know these people as the media keep us abreast of their antics, gambits, affairs, and burgeoning bank accounts. We’re even starting to wonder if the world’s first trillionaire is about to break cover, perhaps even now raking in the final few bucks, bonds, and credit notes to crack the once unimaginable target.

Forbes has its finger on the pulse, as always, and while the numbers change with each deal, transaction, project, or initiative, let’s get the Top 10 list out there right away. No real surprises:

1 Elon Musk: $219bn

2 Jeff Bezos: $171bn

3 Bernard Arnault & family: $158bn

4 Bill Gates: $129bn

5 Warren Buffet: $118bn

6 Larry Page: $111bn

7 Sergey Brin: $107bn

8 Larry Ellison: $106bn

9 Steve Ballmer: $91.4bn

10 Mukesh Ambani: $90.7bn

The Forbes list is much, much longer; it runs into the thousands. But these are the smart primates living high in the canopy of the financial jungle. Their innate smarts are the equivalent of opposable thumbs and tool use, while the rest of us scurry and bumble along the forest floor, chewing on stuff and avoiding predators.

[caption id="attachment_6411" align="alignleft" width="186"] Warren Buffet — 5th richest man in the world[/caption]

One of the first to ascend to those top twigs was the Oracle of Omaha himself: Warren Buffett. His almost supernatural prescience and nous have spawned a million imitators, some of whom got rich by simply asking themselves “What would Warren do?” — and acting on the answer. Buffett has made no secret of his successful tactics; he buys oil and other blue chips that benefit the shareholders. In the first quarter of 2022, his Berkshire Hathaway empire ploughed some $41bn of its $147bn cash pile — mostly insurance float — into the stock market.

If he can do it, goes the thinking, so can we. And, of course, we can; the difference is in the size of the stake, and the ability to absorb any unforeseen losses. (This, if you hadn’t twigged it yet, is why the rich get richer.) Buffett’s company upped its stake in energy company Chevron to $25.9bn and purchased 121 million shares of printer manufacturer HP; $4.2bn, please. In March, Berkshire Hathaway popped a quick $11.6bn into the takeover of Alleghany, the conglomerate built on insurance and reinsurance businesses with a dazzling array of add-on manufacturing pursuits.

But Berkshire Hathaway has struggled to find opportunities just recently. Its most recent grand takeover — the $37bn buyout of Portland-based metal components manufacturer Precision Castparts Corp in 2016 — resulted in a $9.8bn write-down. It was a knock that prompted the Oracle to drop back from Wall Street and major acquisitions. Even the very rich must sometimes exercise caution.

[caption id="attachment_22496" align="alignright" width="300"] Australian mining magnate Gina Rinehart[/caption]

And, before we form the impression that the wealthy lists are a blokey preserve, a quick aside to address noteworthy women like Australian mining magnate Gina Rinehart, and Russian model Natalia Vodianova. No, Vodianova’s not on the billionaires list — but she is one of the world’s top-earning models (her face has graced the cover of Cosmopolitan, Marie Claire and Vogue, her name linked with Gucci, Calvin Klein et al). The daughter of a Russian fruit-seller is married to one of those who is in the Forbes club: Antoine Arnault, CEO of Berluti footwear and son of luxury goods purveyor Bernard Arnault. Heard of him? Founder of the Luis Vuitton / Moët Hennessy (LVMH) conglomerate? Bernard’s third of the Top 10.

Like some of the others mentioned here, Vodianova tempers her lavish lifestyle with philanthropy. In 2004, she founded the Naked Heart Foundation to help disadvantaged children in her native Russia.

And if we’re talking about philanthropy, we have to go back to number four on the richest list. The Bill and Melinda Gates foundation, launched in 2000, is the world’s second-largest charitable foundation, holding $49.8bn in assets. The stated goals are to enhance healthcare, reduce extreme poverty across the world, and expand educational opportunities. Bill and Melinda were joined in that generous venture by number five on the list, Warren Buffett, as well as Mark Suzman and Michael Larson. Gates has said he personally intends to fly the rich list by eventually giving all his money to the foundation.

Which brings us to the richest man in the world: Elon Musk, enigmatic genius, alien imposter, or crackpot, depending on your point of view. He, too, has a philanthropic bent, albeit a more modest and controlling one. He donated $6bn to the UN World Food Programme to fight world hunger (with a list of conditions to ensure he had a detailed plan on how the money would be spent). He also donated $5.7bn of Tesla shares to charity last year — and, to his credit, no public announcement was made. The donation came to light through a Securities and Exchange Commission filing. So, some kudos to the king of the rich list.

The pandemic, a blight for so many, was in many ways the making of Jeff Bezos. Well, in terms of making him richer than ever, anyway. Home confinement, boredom, travel restrictions and lockdowns made online shopping a no-brainer, and Bezos simply had to keep his pockets open and listen to the kaching-kaching-kaching of virtual cash registers.

Bezos has made a few $100m donations — peanuts, really — and one of those went to former president Barack Obama's Foundation. Others went to World Central Kitchen's chef José Andrés and non-profit founder Van Jones for charitable use.

So: heroes or greedy buggers who wallow in obscene wealth? Does it really matter? They’re all, each and every one, an inspiration. What they encourage us to aspire to is a question we can only answer individually.


Lord Waverley on Digital Transactions: Well Worth the Paper They Aren’t Written On

Trading across borders is a notoriously complex process, highly dependent on paper documents — despite decades-long efforts to digitalise.

A cross-border transaction involves multiple actors and, on average, the exchange of 27 documents. All of this makes trade expensive, slow, and unnecessarily complex.

The British government intends to be the world leader in innovation and regulatory reform by implementing common digital standards and driving technology solutions at scale. As companies around the world struggle with high trade costs and large volumes of documentation, an Electronic Trade Documents Bill presents an important step towards standardisation, digitalisation, and simplification.

While the technology exists, information is not yet free-flowing. Different formats inhibit solutions from being driven at scale. Technology, rules, and standards connect the fragmented systems between governments, shippers, financiers, insurers, traders, and ports. Blockchain has made trade based on electronic documents feasible — but the goal is to enable the tech market to thrive.

"The UK is in a position to determine its own path in a world disrupted by digitalisation and recovering from a pandemic. It has a clear agenda for maximising technology innovation to achieve high-level digital trade."

The digitalisation of customs and trade authorisation will not deliver economic gains unless it is combined with legal reform. What is needed is an approach that delivers both, by addressing three barriers to digital cross-border trade.

Enable national laws recognising commercial trade documents in digital form

Address the lack of common digital standards to connect systems

Mass adoption of inter-operable technology solutions.

For the UK, the centrepiece of this year’s legislative programme is the introduction of an Electronic Trade Documents Bill. It will be the start of a journey to revolutionise the trading environment electronically when issuing negotiable instruments and documents of title.
This will include the legal recognition of electronic versions of commercial trade documents, such as bills of lading, bills of exchange, and warehouse receipts. They will have the same legal effect as their paper equivalents and create legal certainty for the transacting parties.

Failure to do this will result in higher trade costs for business, fragmented platforms, and systems that do not connect to one other. Basic trade information cannot flow across the system in overly bureaucratic and inefficient processes.

Documents of title, such as bills of lading, are pivotal instruments in transport and logistics. Title and negotiable instruments are core documents in trade and finance which have, until now, been tied to physical documents and manual handling. Delayed or lost bills of lading cause demurrage for the carrier, resulting in charges and loss of income.

Technology was not available for the creation of electronic paper equivalents. It was not permitted under English law, which requires these instruments to be tangible. An electronic document must be the functional equivalent of a physical document for bills of exchange, promissory notes, warehouse receipts, bills of lading, ships’ delivery orders, mates’ receipts, marine insurance policies and cargo insurance certificates.

Electronic versions of these negotiable instruments can be issued and handled at a fraction of the cost of the paper equivalent, making them available for SMEs seeking discounting with financial institutions. Exports could be boosted, as receivables converted to debt instruments can be sold.

This will permit affordable transport, logistics management and finance, and promote international trade. Digitalisation would also reduce the illicit trading of goods, lowering the cost for finance and discounting, transport documents, and certificate and customs clearance.
Championing neutral trade legislation technology is the United Nations Commission on International Trade Law (UNCITRAL), which anticipated the need for guidance on the distribution of trade documents and published a Model Law for Electronic Transferable Records (MLETR) in 2017.

Several legal reforms in different regions were inspired by the MLETR principles — but the proposals for Electronic Trade Documents would harmonise and future-proof English legislation for international trade standards and legislation.

Thirty percent of global trade is based on English law, so the passing of the Electronic Trade Documents Bill — as a model for other common-law jurisdictions — should enable technology neutrality. Machine-readable documents enable more efficient sanctions and make anti-money laundering and sanctions processes more efficient.

The UK is in a position to determine its own path in a world disrupted by digitalisation and recovering from a pandemic. It has a clear agenda for maximising technology innovation to achieve high-level digital trade. Once in place, the bill will steer digital trade policy and practice towards the UK’s border goals as part of a strategic initiative.

Paperless trade would allow regulation to act as a stimulus for trade growth — and changing laws will cost governments little and deliver considerable economic gains.

About the Author

Lord (JD) Waverley

[caption id="attachment_13312" align="aligncenter" width="300"] Author: Lord Waverley[/caption]

Independent Member
House of Lords

Twitter: @LordWaverley

LinkedIn: linkedin.com/in/jdwaverley


Mutual Benefits: Scottish Friendly Puts Its Money Where Its Heart Is

Looking after members, not shareholders, makes for a healthy workplace.

Scottish Friendly is one of the UK’s largest mutual life offices, with a history reaching back 160 years — and it has never been driven by the needs of shareholders.

[caption id="attachment_23023" align="aligncenter" width="900"] CEO: Stephen McGee[/caption]

As a mutual, it is owned by, and run for, the benefit of members — and profits are reinvested. Scottish Friendly firmly believes in the democratisation of savings and investment, and is committed to creating user-friendly, accessible products.

During the pandemic, the priority for Scottish Friendly was on serving and supporting members, colleagues, and the community. “Our staff showed great resilience under difficult circumstances that have lasted longer than any of us could have imagined,” said a spokesperson.

The purpose-led organisation offers products and services that do not discriminate by age, income, or financial experience. The strategy is “to diversify and grow” — which has three core elements.

Organic growth via a branded product range and distribution channels

New partnerships, and new products launched with existing partners

Acquisition and consolidation.

The focus has brought in record sales of £46.9m APE (it was £42m for 2020). Assets under management increased to £5.4bn, with solvency capital at a strong 174 percent, well above regulatory requirements. Member numbers increased from 745,000 to 776,000.

Of the total, protection sales were £25m (2020: £24.1m) and savings and investments — which include the Scottish Friendly brand, whole of life and savings partners — amounted to £21.9m (2020: £17.9m). Included within savings and investments, Scottish Friendly own brand sales increased in 2021 to £18.4m (2020: £15.7m)

Environment, Social & Governance

Scottish Friendly aims to responsibly invest customers’ funds, and stewardship is consistent with sustainability aspirations. In 2021, the mutual developed its own ESG framework with a focus on sound corporate governance, responsible investing, and improvement of the communities in which it operates. It has made a commitment to net-zero by 2030 for direct and indirect greenhouse gas emissions, and across the entire business and supply chain by 2050.

[caption id="attachment_23024" align="aligncenter" width="900"] Scottish Friendly staff[/caption]

The Scottish Friendly Children’s Book Tour delivers a programme of virtual activities, live-streaming entertaining educational content into classrooms and living rooms across Britain. With input from some of the UK’s most popular authors and illustrators, the content has been viewed 150,000 times via social media and an on-demand library hub.

An ongoing relationship with the Action for Children charity has raised £23,500 to support vulnerable children, young adults and their families across Scotland.

Corporate Governance

The strength and flexibility of the mutual’s governance processes helped it to respond to regulatory changes and best-practice developments. It is a member of the Association of Financial Mutuals and supports its governance standards. There is a commitment to driving continued improvement in all key processes.

[caption id="attachment_23025" align="aligncenter" width="900"] Scottish Friendly Headquarters[/caption]

Regulatory Environment

Last year came many enhancements to policies, processes and systems to ensure compliance with requirements of the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA).

Particular areas of focus include operational resilience, climate change, and the fair treatment and protection of vulnerable customers.

Scottish Friendly has won increasing coverage in national, trade and online media outlets, as well as targeted social media exposure. This was achieved by a tailored programme of press activity, including corporate news, consumer thought-leadership research, and regular commentary on industry topics.

Developments

The strategy continues to deliver for Scottish Friendly customers, and there is a commitment to a diverse and innovative product range.

All success stories are the result of co-operation and concerted effort. In a recent colleague engagement survey, 86 percent of respondents said they were “proud” to work for Scottish Friendly — and nine in 10 were happy working with their team. To maintain the focus on wellbeing, the HR function has launched a colleague-recognition scheme.

There has been a strategic investment relationship with JP Morgan Asset Management and abrdn plc. These relationships provide market insights, support the delivery of investment returns, and provide additional flexibility in volatile investment markets.

There has been investment in new tech to strengthen the mutual’s risk-management framework with automation, new technology and continual cost-management. Through innovation, efficient customer services and responsible capital management, Scottish Friendly is well placed to achieve its objective: to provide long-term, sustainable growth for its members.


Know the Risks and ‘See’ the Future with the Integrity and Transparency of Moody’s Local

The Moody’s name and brand is internationally famous — and the agency’s Latin American platform brings local knowledge to the fore.

[caption id="attachment_23044" align="aligncenter" width="900"] Managing Director-Regional Head Latin America: Martin Fernández Romero[/caption]

Latin American domestic credit ratings and research agency Moody’s Local serves the needs of financial markets in Argentina, Bolivia, Brazil, Mexico, Panama, Peru and Uruguay.

Moody’s Local (ML) provides ratings and local-language research using country-specific methodologies. It’s a platform of Moody’s Corporation (MCO), with processes independent from those of global credit rating agency Moody’s Investors Service.

In 2019, MCO deepened its commitment to Latin America’s financial markets by introducing Moody’s Local in Peru, Panama and Bolivia. In September 2020, it extended its services to Argentina and Uruguay, and in June 2021 it launched in Brazil. The arrival of Moody’s Local Mexico was announced this May, completing the roll-out of the domestic ratings platform in major Latin American markets.

[caption id="attachment_23045" align="aligncenter" width="603"] Moody’s Local is present in Argentina, Bolivia, Brazil, Panama, Peru, Mexico and Uruguay, where local ratings, products, and research are offered.[/caption]

“Moody’s Local strives to offer the highest level of integrity, transparency and consistency,” said Martin Fernandez-Romero, ML managing director and regional head of Latin America. Market participants rely on ML for local opinions — and particularly value the experience of its analysts, “which leads to informed credit decision-making”.

"Moody’s Local strives to offer the highest level of integrity, transparency and consistency which leads to informed credit decision-making."

Martin Fernandez-Romero

[caption id="attachment_23046" align="alignright" width="102"] Source: Moody's Local data, as of 15th July 2022. Including funds.[/caption]

Moody’s Local has seen tremendous growth in Latin America, with more than 990 issuers covered — sectors include structured finance, local government, financial institutions, insurance companies, and corporate entities — and over 300 published pieces of research. Ninety employees have been brought in across the region.

A Moody’s Local rating is an opinion on the relative credit quality of debt obligations, or of an issuer’s ability to honour those obligations, for use in a domestic market. The long- and short-term rating scales are forward-looking opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial institutions, structured finance vehicles, project finance vehicles, and public sector entities.
They are not buy-or-sell recommendations, nor do they guarantee that a particular issuer or instrument will not default.

Credit risk is the possibility that an entity may not meet its contractual financial obligations as they come due. Moody’s Local’s rating system addresses that eventuality by assessing the issuer’s ability to obtain sufficient funds to service the obligation, and its willingness to pay.

ML ratings represent a rank-ordering of creditworthiness within the domestic market of a specific country, and are not comparable among countries. Ratings are forward-looking: the ordering is designed to be maintained over the medium term. An ML rating is an opinion on the relative credit risk of a debt obligation and the ability to honour it. The company reasserts that a rating is not a statement as to which obligors or obligations will default.

The scale runs from a high of AAA to a low of C or D, depending on the jurisdiction. The rating modifier “.n” designates the country where the Moody’s Local rating has been assigned: AAA.ar (Argentina), AAA.bo (Bolivia), AAA.br (Brazil), AAA.mx (Mexico), AAA.pa (Panama), AAA.pe (Peru), and AAA.uy (Uruguay).


The Devil’s in the Detail for Prada, Which Never Goes Out of Fashion

Sustainability is the new watchword for a brand that’s staked its place in our imaginations and desires.

For those who grew up in the noughties, the mention of Prada may call to mind Anne Hathaway and Meryl Streep, New York magazine offices, and iconic makeover scenes.

The Devil Wears Prada is a movie classic that captivated audiences with its depiction of a glamorous but cut-throat world. A clueless “plain Jane” journalist, Andrea Sachs (Hathaway) faces off with #girlboss icon Miranda Priestly (Streep). Demanding, sharp-tongued (and allegedly inspired by real-life Vogue editor Anna Wintour), Priestly subjects Sachs to verbal abuse and submerges her with round-the-clock errands — but the reward for her hard work is a high-fashion makeover, and yes, those thigh-high Chanel boots.

Prada hasn’t always been at the forefront of fashion; it was founded in 1913 by Mario Prada, and the brand began life as a luxury leather goods firm in Milan’s Galleria Vittorio Emanuele II, Italy’s oldest shopping gallery. It sold bags, trunks, and other travel accessories, and in 1919, Prada became one of the official suppliers to the Italian royal household.

Its popularity exploded in the 1970s after Mario’s granddaughter Miuccia joined the family business, designing a set of backpacks and tote bags. She studied political science and delivered communist manifestos “wearing Saint Laurent and emeralds” before taking over in 1978.

Prada debuted on the runway in 1988 and has since created some of the most iconic outfits of the past 30 years. The official Prada ethos is “be drivers of change”, and the brand still aims for the unconventional, the innovative, and the pioneering.

"Under the direction of Miuccia, Prada has even delved into the world of NFTs and the metaverse."

Prada’s newest focus is sustainability. In 2019, chairman and executive director Carlo Mazzi told Vogue that “sustainability cannot be simply a marketing tool” after becoming the first high-fashion company to sign a green loan — credit given on the understanding that it is to be used for environmentally friendly purposes. The same year, Prada signed the G7 “fashion pact”. The first-of-its-kind initiative aims to reduce greenhouse gases to zero by 2050 — and eliminate single-use plastics and achieve 100 percent renewable energy by 2030.

Consumer interest in ethically sourced products continues to grow. Web searches for “organic”, “second-hand” and “vegan” increased by 17 percent in 2021. Prada has continued working on its promises to make every aspect of its business more sustainable; such as building eco-friendly “garden factories” in Italy. The buildings have won awards for their commitment to restoring and preserving nature, and all of Prada’s Italian facilities operate with renewable energy.

There are still two years left on the €50m, five-year sustainability term-loan with the Crédit Agricole Group, and Prada must meet its three sustainability goals in order for interest rates to decrease.

It seems a far cry from the company’s 2006 Hollywood image. In the classic movie, audiences catch their first glimpse of Meryl Streep’s character carrying a grey Prada purse before they see her face. They know straight away that she is the eponymous “devil”.

But in 2022, Prada’s image is less exclusive, more inclusive. In 2019, Forbes reported that “93 percent of global consumers expect more of the brands they use to support local, social and environmental issues” and the Italian fashion house has been adept at keeping up with changing demands.

Prada’s FW22 collection debuted on the runway at Milan Fashion Week this February, with models including Kendall Jenner and Kaia Gerber. The collection featured combinations of grey linen and crushed black satin, sheer mesh skirts, and jackets decorated with faux fur or feathers.
Models were adorned with pearls worn askew and leather trench coats; strong silhouettes triumphed over daintiness. The modern Prada customer means business, but it’s a far cry from the pencil skirts and tailored pantsuits worn by Streep.

For men, bold shoulders and turtlenecks dominated the runway. Titled Body of Work and inspired by utilitarian work uniforms, Prada said in a post-show statement that it wanted to create clothes that make people feel important. “The collection celebrates the idea of working — in all different spheres and meanings. It is a practical, everyday thing. But here, you are formally important. You are not casual.”
Under the direction of Miuccia, Prada has even delved into the world of NFTs and the metaverse. Although the Italian fashion house has historically eschewed collaborations, it has slowly become more amenable to the idea. Perhaps its constantly evolving outlook is driven by Miuccia's rebellious nature.

In 2019, Prada announced a long-term collaboration with sportswear brand Adidas. In 2020, iconic menswear designer Raf Simons joined Prada as co-creative director, and in May 2022, the firm released a collaboration with artist Cassius Hirst.
Miuccia is still notoriously picky about who she works with, however, telling Vogue that whenever requests land on her desk “they always seem to be about selling more — about cliches, banality, and not about ideas.”

With Prada’s SS23 menswear collection recently presented at Milan’s fashion week, and the invitations to its shows delivered on a functional paper coat, Prada continues to innovate and inspire.

Don’t expect to see florals for spring any time soon.

[caption id="attachment_23075" align="aligncenter" width="300"] Author: Kitty Wenham[/caption]


AmInvest: Conventional and Shariah-Compliant Funds  Guided by Deep Expertise

Malaysian fund-management firm AmInvest has four decades of experience in the sector.

AmInvest is the funds management arm of AmFunds Management Berhad and AmIslamic Funds Management.

Based in Malaysia, AmInvest has 40 years of experience managing unit trust funds, wholesale funds, institutional mandates, exchange-traded funds (ETFs) and private retirement schemes (PRS) — encompassing conventional and Shariah-compliant funds.

AmFunds Management Berhad’s CEO says she has noticed strong emerging trends towards Environmental, Social and Governance (ESG) investment. “Investors are also becoming more aware of the need for sustainability for the global community,” she says, “and are aligning their values and beliefs accordingly in their investments.

“We believe the investment returns and the sustainability principles will eventually align, in a similar way to the law of supply-and-demand. Companies that are in-line with ESG themes, and have strong governance, are likely to see growth in value.”

Since May 2021, AmInvest has launched four sustainable and responsible investment (SRI) qualified funds under its Sustainable Series: Positive Change, Climate Tech, Nutrition, and Health Funds. More funds are in the pipeline.

AmInvest has been recognised with numerous awards, including one from CFI.co, as an all-round fund manager.

Goh Wee Peng says the firm works hard to pursue excellence in everything it does, and aims to outperform in our funds against peers and benchmarks.

AmInvest is the brand name for the funds management business of AmFunds Management Berhad and AmIslamic Funds Management Sdn Bhd.


Dollar Dominance: Greenback Will Endure Current Hardships

Financial sanctions on Russia after its invasion of Ukraine sparked speculation that the weaponisation of access to reserves in dollars, euros, pounds, and yen would spark a division in the international monetary order.

China would strengthen its international payments system and accelerate the establishment of the Renminbi as a rival reserve currency to reduce its vulnerability. Countries facing geopolitical risks in their relationship with the US and Europe would seize the opportunity to switch out of the dollar system. But there’s a way to go between intention and action.

The International Monetary Fund (IMF) recently released a study on the evolution of international reserves since the beginning of the century. “Dollar dominance” — the US's share of foreign trade invoicing and international debt issuance and non-banking transactions — is above what the country's share of international trade, international bond issuance, and cross-border borrowing would suggest.

This remains, despite the falling share of US GDP in the global economy. From the 1970s onwards, it survived the end of gold convertibility and the fixed exchange-rate regime inherited from Bretton Woods. Its presence in banking and non-banking transactions actually grew after the 2007-08 global financial crisis.

[caption id="attachment_23092" align="aligncenter" width="900"] Figure 1: Currency Composition of Global Foreign Exchange Reserves 1999–2021.[/caption]

The IMF report shows a reduction in the degree of that dominance, with the dollar's share of central bank reserves falling, down 12 percentage points from 71 percent in 1999 to 59 percent last year. That was not in favour of sterling, the yen or the euro, despite the rise that the euro experienced during its first decade of existence (Figure 1). Instead, it favoured what the IMF calls “non-traditional reserve currencies” — the Australian dollar, Canadian dollar, Swiss franc, and Renminbi — which reached 2.6 percent of the total.

Four gravitational factors favour the continuation of the dollar's central position in international financial markets, in trade invoices and payments, and in public and private foreign exchange reserves. The relative expansion of the other currencies depends on how successfully they manage to offset those factors.

First, the more extensive installed base for dollar-denominated transactions favours the greenback. The increase in liquidity and the reduction in transaction costs in the non-traditional foreign exchange markets — including technological improvements in platforms — helped reduce this.

No other monetary system offers an equivalent volume of investment-grade government bonds as that of the US. That volume allows central banks to accumulate reserves, and private investors to use them as a haven — something reinforced by quantitative easing since the global financial crisis. The 2012 announcement by the-then president of the European Central Bank, Mário Draghi — that he would do “whatever it takes” as a last-resort provider of liquidity for euro-denominated assets issued in the eurozone — was important. The European Recovery Fund was created last year. The global supply of liquid and safe-haven assets usable as central bank reserves tended to widen, in favour of the euro.

[caption id="attachment_23093" align="aligncenter" width="900"] Figure 2: China sees large outflows, while the rest of EM is holding up.[/caption]

It is also worth noting that non-traditional currencies were favoured by a partial search for returns in reserve management. Central bank balance sheets have taken on enormous proportions in recent times. Now, some of them separate what would be the appropriate tranche for liquidity management (the reason for reserves in liquid and low-risk assets, for stabilisation), from another investment tranche, possibly allocated in less liquid but more profitable assets. The search for diversification helped non-traditional reserves.

Another thing in favour of the dollar would be the absence of regulations restricting liquidity and asset availability, including capital controls. Despite the sanctions on Iran, Venezuela, and Russia, there is a difficulty for Chinese bonds compared to those in dollars and the other three major currencies.

Since the global financial crisis, China has sought to extend the use of the Renminbi in international trade, and as a reserve asset at other central banks. This was followed by a proliferation of foreign exchange swap lines with other countries.

But while trade transactions and reserves by central banks and other global public investors may reinforce the Renminbi's position as an alternative currency to the dollar, euro, yen, and pound sterling, the qualitative leap toward its internationalisation as a reserve currency will only happen when confidence in its convertibility is sufficient to convince private investors. It is not by chance that the currency swap lines with China have been little used, while those of the countries with the Federal Reserve have been activated to stabilise flows.

The reserve issuer must accept that large amounts of its currency circulate the world, and that foreign investors help to determine domestic long-term interest and exchange rates. Chinese financial authorities do not appear to be considering relinquishing control. They will probably seek to expand the use of the Renminbi as much as possible while retaining control, and without building some parallel regime to the existing one.

Recent portfolio foreign capital movements into China show what is at stake, and the potential cost to China. Data released by the Institute of International Finance (IIF) revealed an unprecedented outflow of portfolio (debt and equities) capital from China in the wake of the Russian invasion. Such flows remained stable in other emerging economies (Figure 2). The timing suggests links with the war in Ukraine and sanctions. It is not opportune for China to issue any signs of a sudden departure from the system where it currently operates, nor of a possible collaboration with Russia to help it circumvent sanctions.

The relative dominance of the dollar appears to be declining — but at a very gradual pace.

By Otaviano Canuto


Mutually Beneficial New Investment Strategies

Old Mutual Investment Group’s Rob Lewenson explains how he and his team stay ahead of the game when it comes to responsible investing.

[caption id="attachment_23097" align="aligncenter" width="900"] Head of Responsible Investing: Rob Lewenson[/caption]

Old Mutual Investment Group (OMIG), an entity within the 177 year old South African life assurer, Old Mutual Limited, is at the forefront of responsible investing. The company embraced sustainability over a decade ago and has consistently been at the vanguard when it comes to ESG integration and effective listed equity stewardship.

Rob Lewenson has continued to cement and drive this capability forward since becoming Head of Responsible Investment at the beginning of February this year. Prior to this appointment, he was a memberof the Responsible Investment team for eight years and has been an integral contributor to Old Mutual Investment Group’s success in this field.

“I am proud to have been a part of the progress that OMIG has made in moving the responsible investment agenda forward into the future and am excited about what this future will bring as we continue to drive impact through capital allocation,” he said.

In fact, OMIG has shown a deep commitment to investing for a low carbon, resource-efficient and socially inclusive world.

He believes that one silver lining of the Covid-19 pandemic is that it has changed the way we view the world and the way we conduct business, moving the focus towards sustainable, more inclusive growth.

In 2021, South Africa committed to reducing its greenhouse gas emissions to no more than 420 million tons by 2030. A much more ambitious target than what the country put forward five years ago when the Paris Agreement was struck.

OMIG is completely in step with this target having made its own commitment to Net Zero and has embedded ESG into its investment strategies, retrofitting where necessary as well as innovating investment products wherever possible.

Since appointing its first Responsible Investment professional in 2010, when very few investment houses were paying little more than lip service to sustainability, the company has regularly led the way, winning awards and attaining the top responsible investment ranking in 2017. A year later, OMIG launched its South Africa ESG Indexation Funds and in 2020 its South African ESG Equity Fund.

Rob cites the energy and chemicals business, Sasol, which has significantly increased its ambition to deal with its climate transition risks, improving its emissions reduction targets to 2030 and setting out a climate response plan as a prime example of how OMIG contributes in driving that impact. Its influence has seen the company, one of the largest employers in the country, not only significantly increase its emissions reduction targets, but also tying executive remuneration to those outcome targets..

“Stewardship will emerge as our biggest impact tool to deliver sustainable development outcomes,” he says. By way of example, OMIG has achieved no fewer than 14 “stewardship milestones” with major emissions culprit Sasol, going back to November 2014.

Lewenson is aware of socio-economic realities and believes that where renewable energy is seen as a luxury, it should be a right. That has to be weighed against the fact that he and his colleagues sell financial products and count among their clients organisations such as mining pension funds.

“We cannot turn off our coal industry overnight.”

That would shut down the South African economy, so a different approach is necessary when working with organisations with a poor environmental record.

“We continue to interact with the executive teams and board members at these companies, specifically discussing opportunities that exist in shifting their operations into the green economy, which we define as low carbon, resource-efficient and socially inclusive.”

He is pleased with OMIG’s levels of transparency when it comes to its responsible investing credentials: “We welcome scrutiny. We self-regulate and make a lot of our responsible investment activities and outcomes public to avoid accusations of not walking the walk and to stay ahead of the inevitable policy response that increased regulation of ESG products will bring..”

Notwithstanding all the enormous challenges that lie ahead, Lewenson is optimistic, believing that the 2020s will be a transformative decade in the field of responsible investment. He anticipates and hopes for a more sustainable and resilient global economy as a result of the changes happening all around us.

“After ten years of corruption and under-investment in the country, things are changing and there has been extraordinary regulatory reform of the energy sector. This is the ideal time for all our thinking on ESG to percolate into all our areas of investment.”

Please see here for Old Mutual Investment Groups's RI Report.


IFC: Ukrainian Refugees Access Finance via New Digital Data Corridors

[caption id="attachment_23102" align="alignright" width="300"] Photo courtesy: Shutterstock / Maryna Usenko[/caption]

Virtual channels among international financial institutions help refugees verify credit histories and re-establish their careers in host countries

As a psychologist, speech therapist, and owner of a therapy practice in Ukraine, Maryna Usenko helped children find their voice. But after she was forced to leave her hometown of Kyiv on February 24 because of the Russian invasion, she feels like she has lost hers.

When Usenko relocated to Warsaw, Poland, she started meeting Ukrainian parents whose children needed psychological support to adjust to their new environment. They’ve been through a lot, just like she has. Knowing she can help, she set her sights on opening a Warsaw branch of her therapy center. As a refugee, however, financing remains a hurdle.

“Helping children was not a job but my mission,” she said.  “I’m interested in the financing to launch my new business here, but where do I start?  Is it even possible?”

Working with banks was a challenge because Usenko, like most Ukrainians fleeing the war, lost proof of her financial standing, such as the records of her past bank accounts and her robust credit history in Ukraine.  There has been no mechanism by which banks in Poland can connect with Ukrainian banks to recover this information. Without these records, Ukrainians like Usenko have limited access to employment, accommodation, and banking services in Poland—including loans that could help them relaunch, sustain, or grow their careers.

“When we were confronted with stories like Usenko’s, we asked ourselves, ‘How can we solve this problem?’’’ said Vittorio Di Bello, IFC’s Regional Head of Industry for Financial Institutions in Europe. “We came up with the solution of what we call Digital Data Corridors. These corridors can meet the needs and protect the rights of consumers while satisfying the stringent requirements of financial institutions, assuring them that their risk is minimal,” said Di Bello. “IFC established the initiative in response to the financial needs of Ukrainian refugees, because the scale of the crisis in Ukraine urgently demands solutions tailored to refugees’ situation.”

IFC’s Digital Data Corridors initiative brings together a coalition of credit information providers, financial institutions, and industry experts to allow financial institutions to work electronically across borders and receive international credit histories, identity verification, and bank transaction data in real time. With this information, Ukrainian refugees in host countries will be able to get easier access to credit cards, loans, and other services.

The new Digital Data Corridors initiative is backed by the National Bank of Ukraine, Ukrainian Credit Bureaus, Association of Consumer Credit Information Suppliers (ACCIS), and Poland’s BIK Group. The data exchange mechanism has already become operational in Poland, Georgia, Latvia, and the Czech Republic. In fall 2022, IFC will help organize a series of events in these countries to further equip banks with the tools they need to tailor financial services to refugees’ needs.

The scale of the crisis

The Russian invasion of Ukraine triggered one of the largest humanitarian crises since World War II. Millions of Ukrainians fled to neighboring countries, and many more have been displaced within the country. As Poland continues to be the main country to offer refuge to those displaced by the war, more than 3.5 million Ukrainians like Usenko have entered the country since the war started.

But financial institutions in some of the countries where Ukrainian refugees have resettled do not have the infrastructure and resources in place to accommodate the influx of potential new customers seeking banking services. These new potential customers arrived bearing foreign IDs and do not speak the local language, further straining the process.

Poland and other countries, including Moldova, Romania, and Slovakia, have put in place many systems to ensure Ukrainians refugees’ legal rights, including access to employment, education, health care, and social welfare benefits. Over 1.1 million Ukrainian refugees have registered with the Polish authorities so they can access these services. Ninety-four percent of those registered are women and children, according to the UN refugee agency UNHCR.  The EU Temporary Protection Directive also grants residency rights to refugees from Ukraine and offers access to basic financial products and services, such as bank accounts, payment cards, and cash transfers.  Some banks also offer digital interfaces and explanatory materials in Ukrainian.

Working through those channels has allowed many Ukrainians to access the services they need. But there was still a gap in the lending options available for people who ran successful small businesses in Ukraine and were told that their insufficient credit history impacted their ability to obtain financing to keep their enterprises going.

According to ACCIS, digital data corridors that allow banks to share a potential customer’s history help overcome this hurdle.  “Digital data corridors satisfy banks’ need to follow established compliance requirements and gain new customers without much of a risk,” said ACCIS President Mariusz Cholewa. Based on current needs, he anticipates that the demand for bank services will increase significantly when the digital data corridors become operational in European financial institutions.

At a time like this, full integration of Ukrainian refugees into the regional financial system, where credit reporting plays a vital role, is critical, said IFC’s Di Bello. “Establishment of the Digital Data Corridors is definitely a step in the right direction, supporting Ukrainians as they overcome unprecedented economic challenges.”

Published in August 2022.

By Kateryna Chechel.

Source


The Access Bank UK Limited: Focus on Customer Service and Innovative Solutions

A moderate appetite for risk and a passion for serving its customers is standing The Access Bank UK Ltd in good stead.

The Access Bank UK Ltd is a wholly owned subsidiary of Access Bank Plc, a Nigerian Stock Exchange-listed company.

[caption id="attachment_23133" align="aligncenter" width="900"] The Access Bank UK Ltd: offices in the heart of the City of London[/caption]

Like its parent, The Access Bank UK Ltd is committed to developing a sustainable business model — with a moderate appetite for risk, a passion for customer service, and a commitment to building long-term relationships with its customers. It plays a key role in the Access Group’s vision to be “the world’s most-respected African bank”.

The global private bank delivers innovative investment solutions to clients, who value trust, integrity, and accountability as well as investment performance. The Access Bank UK Ltd takes a proactive approach with products and services tailored to customers’ needs.

It provides trade finance, commercial and private banking and asset management products and services for customers in their dealings with Organisation for Economic Co-operation and Development (OECD) markets. It also supports companies wishing to invest and trade in Sub-Saharan Africa, MENA, and Asian markets.

The Access Bank UK Ltd is authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and the PRA. The Dubai branch, in the iconic Gate Building of Dubai International Financial Centre (DIFC), is regulated by the Dubai Financial Services Authority (DFSA).

The institution refuses to chase unsustainable yields as a route to growth. The focus is on building the business through the strength of its customer relationships.

In 2018, The Access Bank UK Ltd became a direct member of the three key British payment clearing systems: Bacs (Bankers’ Automated Clearing Services), C&CCC (Cheque and Credit Clearing Company’s Image Clearing System) and Faster Payments. CEO and managing director Jamie Simmonds said it was “a great landmark for us”, enabling the The Access Bank Ltd UK team to build a sustainable platform with direct entry into the payment clearing system.

“This will enable us to enhance our level of customer service,” he said. “We have a clear commitment here, and we anticipate and quickly respond to market needs with the right technology, products, and services. Joining the UK payment clearing system is a clear example of meeting the needs of our customers.”

[caption id="attachment_23132" align="aligncenter" width="900"] Dubai: DIFC Gate Building[/caption]

The Access Bank UK Ltd provides services to support business activities in Sub-Saharan Africa, and across the world. It was awarded Confirming Bank status by the International Finance Corporation as part of the Global Trade Finance Programme, strengthening its trade finance capabilities. It was also the first Nigerian Bank in the UK to be appointed as correspondent bank to the Central Bank of Nigeria, licensed to undertake infrastructure work on behalf of the Nigerian government and issue letters-of-credit on behalf of the Nigerian government and Nigerian National Petroleum Corporation (NNPC).

The commercial banking team offers relationship-based service for corporate and individual customers. It offers products and services at competitive rates, with market-leading systems and high quality service.

The Access Bank UK Dubai Branch offers products and services to assist customers in the MENA region with trade and investment needs in Nigeria and Sub-Saharan Africa. It is committed to building an enduring relationship in the region, in line with the approach that has proven so effective for the The Access Bank UK Ltd. The Dubai branch, coupled with a presence in the UK and Nigeria, allows the bank to deliver a wealth of expertise.

[caption id="attachment_23131" align="alignright" width="200"] CEO and Managing Director: Jamie Simmonds[/caption]

This is a bank that takes the time to build long-term relationships. It understands customer goals and creates suitable strategies to meet them. Behind all this is a dedicated and professional staff, constantly supported with development opportunities. The bank remains committed to the diversity of its workforce. Many have spent time working in the Sub-Saharan, West African, and international marketplaces. A sense of individual ownership is encouraged — as is a strong team spirit. The aim is to help employees realise their potential through continuous learning opportunities, with the tools and training to support professional growth.

The Access Bank UK Ltd is led by an accomplished team determined to deliver superior financial solutions. As Jamie Simmonds puts it: “Our people are fundamental to our bank’s continued development. They provide the skills that deliver our focus on service and customer relationships. Reflecting this, during the year we selectively recruited additional members to the team and invested more in professional development. We were the first Nigerian bank to achieve Investors in People accreditation.

“We have now advanced our status to Platinum. We believe that our consistently low staff-turnover rate reflects in part the advances we have made in training and development. The bank is working in partnership with the Chartered Institute of Personnel & Development (CIPD) programmes.”

In the Report and Statutory Accounts for 2021, the bank demonstrated another year of all-round growth, achieving and exceeding targets for all main growth strategies. Entitled Charting a Course for the Future, the report highlights a strong operational performance by the main strategic business units — and continued growth in Sub-Saharan Africa and the MENA region.

The bank has passed the $100m milestone for the second successive year to achieve $111.1m for 2021, a 10 percent increase. The trade finance operation continues to be the bank’s largest SBU and is confirming bank for Access Bank Plc and the Group. Trade finance maintained an upward trajectory, with income up nine percent year-on-year to $55.8m and correspondent banking income growing to $27.8m, up 12 percent year-on-year.

Commercial banking income has reached $37.6m while asset management income rose by 52 percent to $5m. Retail products continue to attract interest, with £152.2m flowing into its one-, two- and three-year bonds during the year. The Access Bank UK Ltd also announced the launch of a new Visa debit card for personal and business banking.

Simmonds said a challenging external environment and difficult trading conditions failed to dent another strong performance. “The performance reinforces the effectiveness of our proven income-driven strategy,” he said, “in which we deepened relationships with key customers and retained relationships that we have had for a decade or longer.”

Herbert Wigwe, chairman and non-executive director, added: “In achieving another strong set of results in 2021, the bank has emerged fitter through the continued growth and retention of its customers and an increase in staff.”

Jamie Simmonds said that throughout his experience in financial services, his guiding principles have been to deliver excellent customer service and provide innovative solutions. “I have been involved in the turnaround of several existing businesses by going back to these basic principles and rebuilding from the ground up.

“When I established the The Access Bank UK Ltd in January 2008, it was at a turbulent time in banking — but we set the risk appetite, the processes and procedures, and developed products that our customers wanted.”


ThirdWay’s the Charm to Revitalise Africa’s Climate for Healthy Investment

Sustainability and ethical responsibility tied to entrenched values and deep expertise in the continent.

Investment and advisory firm ThirdWay Partners launched in 2014 with the mission to radically alter the investment climate in Africa.

The firm facilitates inclusive, sustainable development via advisory and principal asset management services, working with both private and development finance to pursue impact investing opportunities. ThirdWay has maintained a focus on the UN’s ESG aims for sustainable development, and it boasts deep expertise in capital raising and structuring, business model development, market assessments, blended finance fund design. management, and technical assistance.

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With the world in turmoil at many levels ThirdWay Partners is comprised of a group of forward-thinking individuals motivated by a desire to challenge the status quo — and a conscious desire to responsibly use resources and forge new paths.

As African economies recover from the pandemic and the continent grapples with climate change, ESG policies play a crucial, long-term role. Environmental and ethical issues are gaining momentum and moving to the forefront of business development.

ESG strategies hold significant importance in Africa as investors, funders and consumers place trust in companies that demonstrate commitment to these standards. In a complex world, some companies struggle to be resilient without incorporating ESG impacts and opportunities into their risk-management and business strategies.

Investors and development stakeholders have seen that incorporating these policies is essential for financial growth. ThirdWay is focusing on the lead-up to 2023 and recognises crucial ESG themes.

Nature-Based Solutions

Given ThirdWay Partners’ experience of immersive engagement with communities and conservation and long-standing partnerships with an array of development and private investors — the firm aims to further develop its natural capital focused work. Natural Capital is a dynamic and exciting area of finance.

Instrumental to this will be leveraging investment opportunities to worldwide organisations which have climate agenda strategies.

The intention is to let impact move the needle in the climate space across a host of nature-based solution options, including biodiversity, carbon, waste-management, arable land, water scarcity, and habitat.

Energy Transition

In the African context, an opportunity exists to divorce economic growth from emissions. With economic development, emissions typically rise sharply. Emerging markets such as Sub-Saharan Africa face the challenge of growing and decarbonising at the same time. There is an opportunity to identify and scale low-carbon “leapfrog” solutions to avoid the emissions uptick. This will allow developing countries to decouple their personal objectives while joining the global transition to net zero.

Many of the critical minerals on which the global energy transition relies are found in Africa, positioning the continent to be a major participant in the global transition. Sub-Saharan Africa’s mineral reserves are an essential component in the global battery supply chain, with minerals such as nickel, graphite, cobalt, lithium and coltan. DR Congo currently produces about 70 percent of cobalt, and has the potential to be a major exporter of green hydrogen, based on solar and onshore wind generation potential.

ThirdWay’s focus will be on securing and enhancing the efficacy of the mineral supply chain, and economically important segments of the economy that have the potential to catalyse growth elsewhere, such as low-cost zero-carbon electricity, transport, agriculture, resource efficiency, carbon storage and clean energy technologies.

Sustainable Consumption

Consumption is a driver of economic growth, but leads to overuse of the planet’s natural capital: slash-and-burn farming, pollution of water sources and oceans, and damage to fragile ecosystems.

ThirdWay Partners Sustainable Consumption and Food Production Practice focuses on putting consumption and food production on a sustainable path, reversing negative ecosystem impact, and bringing new products to the market. It does this while securing incomes for communities that work the land or depend on the forests and sea for their livelihoods.

The firm’s philosophy is that economic gains and productivity should go hand-in-hand with business models that allow growth yet preserve natural capital. The communities where they operate benefit from meaningful jobs and opportunities for income-generation. The Sustainable Consumption and Food Production Practice is derived from this ethos and the UN’s Sustainable Development Goals.

ThirdWay advises enterprises and governments at central and provincial levels in defining policies and investments in agriculture, forestry, and rural development. It also emphasises circular economy solutions across supply and distribution chains,and identifies alternative food solutions — from protein to micronutrients sources in algae and indigenous plants.

The firm has grown significantly in the transition from ThirdWay Africa to ThirdWay Partners, and the team remains delighted in its role as a leading presence on the African continent.