Global Banking & Finance Review Issue 52 - Business & Finance Magazine

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editor FROM THE

Dear Readers’

I am pleased to present Issue 52 of Global Banking & Finance Review. For those of you that are reading us for the first time, welcome.

Featured on the front cover is our 2023 Business Woman of the Year - South Africa, Christine Wu, Absa Group Limited. Headquartered in Johannesburg, with over 150 years of African heritage and having developed a significant footprint across the continent, Absa Group Limited has worked to position itself as Empowering Africa’s tomorrow, together ... one story at a time. Christine Wu joined Absa in 2019 as an Executive member of Absa Retail and Business Banking business. In 2022, she transitioned to Everyday Banking as a Managing Executive: Consumer product, where she is responsible for ensuring Absa’s overall success in the consumer banking segment. She takes end-to-end accountability for core product performance and the transformation into a digital and data first business. Her portfolio includes transactional banking, card issuing, personal loans and savings and investments. In addition to traditional product responsibilities, she also leads the digital, design and advanced analytics capabilities. Christine has been credited with providing the business with a renewed edge and greater customer centricity. Looking ahead, she is geared up for even greater success, leveraging Absa's strong presence in South Africa with the distinctive data and digital capabilities to create .to create an empathetic digital bank. (Page 26)

Milan-based asset management company Arca Fondi SGR has a rich history spanning four decades. Founded with a view to serving the typical Italian saver with a basic understanding of finance and a low-risk propensity, Arca Fondi SGR specialises in long-term investing. Ugo Loeser, CEO of Arca Fondi SGR revealed in his interview with me that when the company’s story started 40 years ago, it was based on four core values. Turn to page 18 to find out how Arca Fondi SGR remains proactive in meeting the evolving investment needs.

Mário Amaral, Managing Director and CEO of Hemera Capital Partners (HCP) answers my questions on Southern Africa’s economic potential, the opportunities HCP has identified for investors, and the range of different funds it offers in order to capitalise on them. He also provided insight into its H-IMPACT initiative, which drives impact through the support of clients’ sustainability strategies and ESG activities. (Page 32)

We strive to capture the breaking news about the world's economy, financial events, and banking game changers from prominent leaders in the industry and public viewpoints with an intention to serve a holistic outlook. We have gone that extra mile to ensure we give you the best from the world of finance.

Enjoy!

Wanda Rich Editor

30

BANKING

Banking and AI: how can we ensure ROI?

Marshall Choy, SVP of Product, SambaNova Systems

Banking on data: How storage powers digitalised banking

Grigory Nikonov, Systems Engineer, Western Digital

Currency cure: Should the Fed and the BOE adopt an “Atlantic Declaration” on CBDCs to avert further banking crises?

Leon Gauhman, Chief Strategy Officer and Chief Product Office, lsewhen

12

BUSINESS

Is your business being crushed by big data? Don’t worry, help is at hand

Colin Bryce Managing Director, Cobry

Fostering trust in the hybrid work model: overcoming challenges and maximizing potential

David Vander, CEO, LiveTiles and BIAN Board Member

Preparing for turbulence: building business resilience for 2023 and beyond

Edgar Randall, Managing Director, Dun & Bradstreet UK&I

Unlocking the potential of familyfriendly employment laws

Adrian Lewis, Director, Activ People HR

By Vanessa Bagnato, Director of Product Marketing,

Pavlo Khropatyy, VP, Global Head of Delivery FS&I, Intellias

Alchemer

Read it on page 18

At 40 Years Old, Arca Fondi SGR

Remains Proactive in Meeting

Evolving Investment Needs

Ugo Loeser | CEO | Arca Fondi SGR

Read it on page 32

Hemera Capital Partners: Identifying Diverse Opportunities Too Big To Be Ignored

Mário Amaral

Managing Director & CEO

Hemera Capital Partners

Christine Wu of Absa Group Limited: Driving Digital Security and Innovative Customer Experiences

Understanding the Contactless Revolution

Stand in the payment queue at any shop in 2023, and many of the transactions taking place will likely be contactless. Indeed, according to industry research, nearly 60% of in-store shoppers paid using a contactless card last year – an increase of 94% compared to the 12 months before.

Among the various drivers of this important trend are the environmental, social, and governance (ESG) policies pursued across the financial services industry. These include efforts to significantly reduce the use of plastic cards across the payment ecosystem – a move which could eventually see mobile contactless apps become the primary payment method.

Considering the ESG standpoint, it becomes evident why the issue holds significance. Approximately 6 billion plastic payment cards are produced annually, with 2.8 billion being credit cards utilised worldwide. These credit cards amount to a staggering 140 million kilograms of plastic, which poses a considerable environmental burden. In light of organisations’ widespread efforts to minimise plastic consumption, this situation is unsustainable, particularly when technological innovations are readily accessible.

Moving Towards Net Zero

Part of the problem with the disposal and recycling of plastic cards is that there are no regulations to manage them when they expire or need to be replaced. For most people, disposal has generally involved cutting them into pieces and throwing them in the bin. This approach circumvents recycling options altogether, but is one that is perhaps understandable

given the apparent security concerns. As a result, this waste plastic will generally end up in landfill.

So, what are the prospects for further growth in using contactless payment systems, and where might the industry be heading in the coming years? Firstly, it’s worth noting that the financial services industry has a strong track record of embracing tech-led innovation. As far back as the 1950s, the industry drove the adoption of credit cards in a move which, at the time, brought huge levels of payment convenience. Today, innovation continues to drive positive change, with the digital payments system transforming the speed and convenience of everyday transactions.

However, what needs to come next is for more organisations across the sector to set out their plans to reach net zero. This is no easy challenge, particularly for today’s large and complex businesses that operate across national boundaries to deliver a 24/7/365 business model. Where relevant, minimising or even eliminating the use of plastic can provide significant progress, particularly given the vast number of cards in circulation.

Using contactless payment and mobile e-wallets allow people to stop using plastic cards completely. Whether transactions are completed via a phone app or even a watch, these systems saw significant growth during the Covid-19 pandemic, where many people were reluctant to use

physical cash, especially when an effective alternative was readily available. Building on this growth trend will continue to take more plastic cards out of circulation, especially if financial services and app developers can continue to improve accessibility options for people who remain reluctant to switch from physical cards or cash.

Whilst the shift to digital payments brings new risks to security, it has in fact brought significant improvements compared to traditional plastic cards. By leveraging encryption features, authentication protocols, and real-time monitoring of payments, digital payment methods offer significant protection against fraud. These advanced security measures help organisations stay ahead of evolving threats and can provide users with greater confidence in the security of their financial transactions.

Bridging the Digital Divide

However, while the shift towards a digital, contactless payment system offers a wide range of benefits, it also brings some challenges that must be taken into account. One of the most significant is the digital divide between consumers with full and easy access to smartphones, reliable internet, and the technological know-how required to use them, and those without. This issue can disproportionately impact older generations in particular and creates the risk of financial exclusion – a situation that must be avoided.

To address these challenges, there is an ongoing need for more effective educational initiatives from both the industry and government. These initiatives should focus on breaking down barriers and empowering consumers to feel confident transitioning to digital payment systems. Through comprehensive training and support, organisations and government entities can bridge the digital divide, ensuring that everyone can move towards a digital payment future.

There’s no doubt, then, that the expiry date for the use of plastic cards in the payment process is fast approaching – the question for the industry is how soon they can be removed from the environmental burden it creates for the benefit of everyone.

Pavlo Khropatyy VP, Global Head of Delivery FS&I Intellias

Colin Bryce Managing Director of Cobry, a Glasgow-based digital transformation company and Google Cloud partner

From being the preserve of actuaries and statisticians a generation ago, suddenly we have all become big data handlers.

Even the smallest of businesses and organisations are now expected to handle and organise flows of information from multiple channels every day and, for many, it can feel overwhelming.

The reality is that it’s only going to intensify. By 2025, it is estimated that we will be generating 175 zettabytes – or 175 trillion gigabytes – of data globally every year.

Since one gigabyte is equal to one thousand million (109) bytes, 175 trillion gigabytes is expressed as 175,000,000,000,000,000,000,000 or 17.521 bytes, representing a fivefold increase in data generation since 2018, and 180 times more than was generated 20 years ago.

To put that figure into some kind of perspective, the Apollo 11 moon landing was achieved using around 4,000 bytes of computing power. A modern smartphone typically uses four gigabytes of randomaccess memory (RAM).

Big-data technology is transforming almost every industry by creating actionable information and, because of its effectiveness in helping to generate new business, even small companies, usually slow to adopt new technologies, are coming on board, helping them to leverage up 15% more sales, according to a recent study.

Is your business being crushed by big data?

Don’t worry, help is at hand

An increasing amount of data is already generated by artificial intelligence (AI), to map the performance and output of the growing number of digital things in our lives.

As 5G communications become more widely adopted, these will soon include driverless transport, Internet of Things (IoT) devices including sensors in our bodies, homes, factories, and cities, as well as high-resolution content for 360 video and augmented reality.

Companies and organisations that are early adopters of big data analysis tools are more likely to benefit from reduced costs – including by optimising pricing strategies –increased operational efficiency and an improved ability to identify weaknesses and failures in their operations.

They will also be better able to design new products and services, conduct 360-degree customer reviews and identify and prevent fraud.

As a provider of Google management tools and services, the main bread and butter of our business has, until now, been platforms that help our clients handle documents, email files, video calls and other communication tools.

We estimate that, within two years the bulk of our work will be helping those same businesses to cope with the enormous flood of data they can expect to receive.

All companies have data; most have a lot of data and quite often the way it is organised is chaotic or not fully thought through. There’s not much governance and thought currently give to how that data is collected and organised and shared.

Our first step with new clients is to help them collect data in a consistent way – which means it’s easier to make sense of – and then to feed it through into what are called data lakes. We effectively pipe all of their data, from different sources, into one place, so that it can be more easily interrogated.

Depending on the business, data can come from a range of different sources. Here are just some of the different types of intelligence that is routinely gleaned about its customers.

• Personal data: Includes information such as their gender, occupation, age, and social class as well as non-personal material such as their IP address, web browser cookies and IDs of devices including laptops and mobile phones.

• Engagement data: This helps businesses to understand how their customers interact with their website, mobile phone apps, text messages, social media pages, emails, paid ads, and other customer service routes.

• Behavioural data: Provides companies with transactional details, including purchase histories, product usage information, such as repeat custom as well as qualitative data, such as mouse movement information.

• Attitudinal data: Encompasses metrics on items such as consumer satisfaction, buying criteria, product desirability and more.

Giving all that data structure and coherence helps businesses to better understand what it means, to visualise it and to create dashboards, charts and graphs so that non-experts are able to see and understand what is happening with their customers.

Providing them with live intelligence and insights into customers habits and behaviour, means they can make better informed, data-driven decisions in a useful way, rather than flying blind.

Some businesses that have yet to perform any data analyses often worry that they don’t have enough information to analyse. Most have more information than they can handle and, as the business grows, big-data systems become more relevant.

Few business owners can expect to gain any meaningful insight by reviewing data manually; they need the right tools and methods provided for them and explained by a specialist.

If they don’t have the budget for a full-time analyst, hiring a consultant who can point them in the right direction is a useful alternative. As well as creating statistical summaries of their data analyses, an expert will also help them to understand what’s causing the patterns in their data. Business owners and senior managers will also need to know what may happen in the future and technologies such as predictive and prescriptive analytics can help them to achieve that.

Using real-time analytics can provide them with critical insights, in real time, on an executive dashboard. Dashboards permit them to access information, ondemand, via a smartphone, laptop, or other connected device and to share the information with colleagues.

Most businesses have spreadsheets, databases and customer-relationship management tools that are full of valuable information and can be used in combination with commercially available data sets and easy-to-use, Google data management tools.

After they have analysed their data, they will need to have it presented in a way that non-technical staff members can comprehend and use to make informed decisions. Again, Google has a range of data visualisation tools that will work with their current technologies.

It’s generally accepted that Big Query is the best tool for gathering data and they also have arguably the best data visualisation tool in Looker. It’s more than a visualisation tool, it also takes care of governance and sharing of data.

Everyone has their strengths in different parts of the cloud but I think everyone would accept that Google has the lead in data.

Change management is something that we have long standing expertise in and we have noticed that the techniques we have developed over a decade in helping people move to Google Workspace translate perfectly in helping them, to make sense of their data challenges, such as communicating with them, giving them a clear picture of what the pathway is going to be, training people and upskilling them and improving their knowledge.

As we all strive to become big data handlers, it’s comforting to know that there are tools available to help lighten the load.

What We Learned About Finance Apps from Millions of Installs

However, when a brand engaged with customers asking for reviews (the “Do you love our app?” feature in Alchemer Mobile used to gauge customer satisfaction), 90-day retention rates grew to 85% in Fintech, 75% in Insurance, and 91% in Banking.

Customer Sentiment

Alchemer just released the 2023 Mobile Customer Engagement Benchmark Report, and customers in Fintech (credit score, mortgage, stocks and bonds, and loan consolidation.), Banking (banks and credit unions), and Insurance (auto, home, life, renters, and pet) have vastly different motivations and usage patterns.

The Report compiles data from the past year on more than 1.2 billion app installs from Alchemer Mobile customers and the people who use their apps. As it does every year, the report provides unique insights into mobile customer behavior and what gets people to act.

Customer Retention

Finance apps typically have high retention rates, and this held true in 2022. Collectively, the category had 30-day retention rates of 71% (compared to 67% across all categories), 90-day retention rates of 63% (58% overall), and annual retention rates of 45% (42% overall).

Positive Customer Sentiment for all of Finance was 76%, above the overall benchmark of 64%: Fintech was 78%, Banking was 79%, and Insurance was 73%. The high cost of switching contributes to good customer retention, but it doesn’t ensure that sentiment will remain high. Mobile teams that proactively ask for in-app feedback on a regular cadence are better able to keep customers active and engaged in their mobile channels, extending their reach and deepening their brand relationships.

In-app Surveys

Finance brands have room for improvement when conducting in-app surveys. Finance apps’ average survey response rate was only 11%, lower than the overall benchmark of 13%. It was significantly subpar in the Fintech subcategory at only 4%. When mobile teams used surveys presented with a Note – an in-app message or invitation from the brand – to ensure customers were bought into the survey before presenting it, the results were fantastic: the average response rate to Note-linked surveys was 59%. Finance brands should experiment with various engagement strategies across target segments this year. Additionally, these brands will want to close the loop with people, by responding personally, so customers know their feedback has been heard and acted on.

Engaging customers appears to be the key to success in 2023 and beyond. The average interaction rate (the percentage of people who respond to a request for feedback) is 36% for all of Finance, but only 29% of customers are prompted for surveys. When Notes are used to invite consumers to participate in a survey, the response rate jumps to 59% overall and as high as 87% in Fintech. Engaging customers through surveys is one of the easiest ways to improve ratings and reviews because you can ask for feedback from the right customer as the precisely right time.

Vanessa Bagnato Director of Product Marketing Alchemer

Across all industries, iOS customers were generally happier with apps than Android users. In the Finance industry, iOS customers gave apps an average of 4.8 stars in the App Store, while Android customers gave an average of 4.63 stars in Google Play. Fintech scored the highest at 4.81 stars, but Banking and Insurance were not far behind at 4.73 and 4.72, respectively. Finance apps received an average of 182 reviews, with Android customers leaving on average six times as many reviews. In general, Android users tend to be less generous with stars than iOS users but more willing to spend the time to write reviews.

The Value of Customers at Risk

Tracking customers and their feedback over time, through in-app feedback, provides businesses with the opportunity to retain customers at risk of churning. Even though customers categorized as Risks (those who answered “No” to the question, “Do you love our app?”) are unhappy with an app, in the Finance category, customer retention is just a couple of percentage points better for customers categorized as Fans (those who answer “Yes” to the question “Do you love our app?”) than Risks (86% Fans versus 82% Risks after 30 days). This means that even though customers at Risk are unhappy with the app, they’re invested in making the app work better for them. Consequently, closing the loop with these customers not only lets them know you heard them, but when you make changes based on their feedback, they are much more likely to convert from Risks to Fans.

Remain Focused on Keeping Customers

Mobile app retention will remain an essential metric for mobile product owners and managers across the Finance industry. Since acquiring new customers can cost five times more than retaining existing ones, many mobile product owners are shifting their focus to keeping the customers they have. Additionally, the success rate of selling to a customer you already have is 60-70% versus 5-20% for new customers.

Product owners and managers will likely seek out tools in 2023 to better understand why customers churn and develop programs to improve app adoption and customer retention. Mobile product managers need to drive the successful acquisition, adoption and retention of their mobile apps. Collecting feedback and customer sentiment over time, helps with customer adoption. However, smart mobile product owners in the Finance sector will take the next step to to respond with messages, promotions, and surveys to improve or better seize the opportunity and drive ongoing customer retention.

At 40 Years Old, Arca Fondi SGR Remains Proactive in Meeting Evolving Investment Needs

Milan-based asset management company Arca Fondi SGR has a rich history spanning four decades. Founded with a view to serving the typical Italian saver with a basic understanding of finance and a low-risk propensity, Arca Fondi SGR specialises in long-term investing. Today, the company’s widespread presence spans over 100 distributors, 8,000 bank branches, and a network of financial advisors and online channels.

When Wanda Rich, editor of Global Banking & Finance Review spoke with Arca Fondi SGR’s CEO Ugo Loeser, he revealed that when the company’s story started 40 years ago, it was based on four core values that it names as having always been integral to its work: delivering outstanding returns for clients, providing exceptional service, fostering continuous innovation, and maintaining clear communication and transparency. “These values have served as our guiding light throughout our journey, which consists of significant milestones and pivotal moments,” Ugo said. “It all began back in 1983, when Arca Fondi SGR was founded by 12 regional Italian banks. This happened shortly after the introduction of Law No. 77, which regulated mutual investment funds in Italy. In 1988, Arca launched Arca Previdenza, one of the first pension funds in Italy aiming to collect private savings to invest them for the long term.”

He recalled how the financial crisis of 2008/2009 served as a catalyst, compelling the industry to significantly enhance its offerings and bridge the gap between investors and mutual funds. “This led to the emergence of target date solutions, which featured regular coupon distributions, predetermined maturity dates, and decreasing durations. With the launch of Arca Cedola funds in 2009, we quickly became a prominent player in this field. In 2017, under the Gentiloni government, the concept of financing Italian companies directly through mutual funds was adopted, taking inspiration from the French model. This innovative approach aimed to provide support to Italian businesses.

“As a result, ‘Piani Individuali di Risparmio’ (Individual Savings Plans) were introduced,” he continued. “These are mutual funds that benefit from subsidised taxation and invest in exceptional Italian companies. We were well-prepared in this area and promptly launched the Arca Economia Reale Bilanciato Italia fund. This established Arca Fondi SGR as a pioneering asset management company in offering a PIR solution.”

Today, the company finds itself amidst a significant transformation in the asset management industry, which in recent years has led to an ever-greater focus on supporting sustainable growth, driven in part by European legislation. “In 2019,

Arca Fondi SGR demonstrated its commitment to this cause by signing the United Nations Principles for Sustainable Investment (UNPRI) with the belief that through financial investments, we could make a positive impact on the environment and society.

“In 2021, we introduced Arca Oxygen Plus, the first in a range of mutual funds designed to blend potential returns with environmental consciousness. In 2022, we launched Arca Blue Leaders, an equity fund that invests in global stock market securities focusing on the sustainable use of water resources and the preservation of the marine ecosystem. Finally, with the recent introduction of Arca Social Leaders, we established the first Italian fund dedicated to addressing social issues.”

Ugo affirmed that environmental, social and governance (ESG) investing remains a top priority for Arca Fondi SGR. ESG investing has become increasingly popular in the asset management industry, with investors now more aware of the impacts their investments could have. “They seek investment opportunities that align with a sustainable future,” he said. “Governments and regulatory bodies worldwide are also placing greater importance on sustainability and ESG factors. This regulatory support offers clarity, standardisation and accountability, facilitating the growth of ESG investing and making it more widely adopted.”

While the inflow of investments has certainly had a positive impact on company valuations, Ugo feels that it is important to note that sustainability is not a bubble. “In fact, the average valuations of ‘Green’ companies are comparable to those of ‘Brown’ companies. In simpler terms, when we look at the price-to-earnings ratios (PEG ratios) adjusted for expected earnings growth in the medium term, we find that they are about the same for both traditional stock market indexes and ESG indexes.”

Arca Fondi SGR has successfully integrated sustainability into its investment processes, Ugo explained, which includes the incorporation of an ESG risk assessment model that enables a more comprehensive evaluation of investments and has a significant impact on investment outcomes. “Our proprietary model, which utilises data from the MSCI information provider, allows us to assign an ESG rating to nearly all the financial instruments we invest in. This rating encompasses the overall ESG performance, as well as specific ratings for the three pillars: environmental (E), social (S) and governance (G). The ratings provided by our model range from CCC to AAA, offering a similar level of detail to credit ratings. For example, the A rating is further divided into A-, A and A+.

“Our proprietary data and questionnaires, specifically tailored for small and mediumsized enterprises in the Italian market, enhance our analysis. Furthermore, each instrument is regularly monitored to determine whether the issuer is involved in any disputes related to their operations or products. Depending on the severity of the dispute, the instrument’s rating is adjusted accordingly. Issuers belonging to specific subsectors, such as aerospace and defence or casino and gaming, face penalties as an algorithm assigns them lower scores.”

He added that the model also blacklists government issuers and corporate sub-sectors that do not align with environmental, social and governance sustainability values. “These are industries and companies known to harm society and the environment, such as producers of controversial weapons like landmines, cluster bombs, and chemical or biological weapons. Additionally, countries with controversial practices are also excluded from our investments.

“Our rigorous approach to sustainability has been recognised both nationally and internationally, earning various awards. Despite our overall size, we offer a wide range of ESG investment options. We currently have 14 sustainable funds, with 8 falling under Article 9 classification according to SFDR legislation, and 6 classified as Article 8.”

Ugo revealed that the reputation Arca Fondi SGR has gained for its innovation and development of new investment products stems from its company culture that focuses on meeting the evolving needs of investors. “Arca Fondi SGR’s ability to consistently innovate in product offerings is rooted in our service model, which prioritises client-centrism, transparency and product quality. Our company focuses on fulfilling the needs of customers and bank distributors, which leads to the development of unique investment solutions that take advantage of opportunities in the financial markets.”

This assertion is backed up by the events of the past year, in which Arca Fondi SGR’s efforts to find favourable opportunities have resulted in the successful introduction of new target date products. Examples of these products include Arca Cedola Attiva Plus, a bond fund that generates high coupons through diversified investments, and Arca Difesa Attiva, which protects invested capital while offering substantial participation in the growth of European stock markets.

Ugo attributes these accomplishments to the organisation’s corporate culture. “Arca Fondi SGR has fostered a collaborative environment that encourages cooperation across different functions and has embraced an agile and flexible mindset, enabling a quick adaptation to evolving market conditions. Our dedicated teams consistently monitor competition and industry trends, while also utilising our proprietary big data platform and advanced analytics to analyse customer characteristics. Our goal is to deliver the best possible products to meet the needs and expectations of our clients.”

Several technological advancements have already made a significant impact on the wealth management industry, and these trends are expected to continue evolving. In Ugo’s opinion, there are two main elements that will have the greatest impact on the industry: AI/ML, and data analytics and big data.

“Artificial Intelligence (AI) and Machine Learning (ML) technologies have the potential to revolutionise asset management by improving efficiency, generating better investment outcomes, and enhancing the overall client experience,” he said. “By processing large amounts of data, AI and ML can identify patterns and generate insights that help optimise

portfolios, manage risks and generate higher returns. Data analytics and big data can collect, process and analyse data from various sources, offering insights into market trends, investor behaviour and investment opportunities. By leveraging data analytics and big data, asset managers can make more informed decisions, tailor investment strategies to client needs and gain a competitive edge.”

Ugo summed up by emphasising the significance of innovation to Arca Fondi SGR’s ongoing success. “We have always been proactive in embracing innovation at Arca Fondi SGR. We understand the importance of leveraging technological advancements to enhance our services and cater to the needs of our customers. By adopting a customercentric approach and providing a high-level service model, we aim to differentiate ourselves from other players in the market. As a result of our commitment to innovation and customer satisfaction, we have experienced significant growth in our customer base and managed assets. This success has laid a strong foundation for achieving impressive financial results, even during challenging times like 2022. We believe that our focus on innovation, coupled with our dedication to serving our customers, will continue to drive our success in the future.”

Ugo Loeser CEO

Arca Fondi SGR

Fostering trust in the hybrid work model: overcoming

challenges and maximizing potential

The banking and finance sector has traditionally relied on a centralized office environment for its operations. However, with the mass shift to remote working three years ago and the subsequent rise of hybrid work models, the industry faces unique challenges in establishing trust both among employees working remotely or in a hybrid setup, and clients whose accounts are now being managed remotely.

services companies had employees working from home 60 percent of the time. This increased to nearly 70 percent by 2022 – with almost double the number of senior leaders dedicated to making remote working a reality.

David Vander CEO of LiveTiles BIAN Board Member

Since 2020, the world of work has been changing in real-time, and Teleworking has now become an irreversible reality. According to PWC, before the covid pandemic, less than 30 percent of financial

Yet, despite the commitment to normalising hybrid working, there remains some key challenges faced in the sector that prevent better management of the hybrid workplace. Ultimately, many organizations still don’t have the required digital technologies and tools in place to face the breakdown of culture and collaboration required to attract and retain talent. Often too, relevant flexible workplace policies are not in place to manage employees working remotely and to support the leadership teams intended to supervise, organise and encourage them.

So how can the finance sector better manage a hybrid work environment, and build employee-employer trust within and without this model?

The Trust Conundrum in Banking and Finance

In recent months, we have witnessed companies like Twitter, Starbucks, Salesforce and Disney backpedal on the promise of permanent flexible working plans. Meanwhile, banks such as JPMorgan Chase & Co and Morgan

Stanley are providing incentives to entice staff into the office more regularly and, most recently, Meta bosses have backtracked on the perceived benefits of remote working, emphasizing the belief that trust is easier to build in person.

This perception, while prevalent, fails to consider the advancements in technology and the evolving nature of work. Remote or hybrid employees who are highly productive may still not be trusted to perform their jobs effectively if they are not physically present in the office. But it is more crucial than businesses might realise to challenge this misconception. A new wave of employees expects a level of flexible working as part of their package and find value in working this way. In fact, according to LiveTiles’ latest study of teleworking professionals, carried out jointly with the OECD, over 80 percent of teleworkers said that they would be prepared to quit their jobs should they no longer be allowed to work remotely.

Consequently, it has become more important than ever to explore strategies that cultivate trust in remote and hybrid work environments.

The Impact of the Costof-Living Crisis

The finance sector is not immune to the cost-of-living crisis, which affects both employees and employers. High living expenses in major financial hubs often push employees to relocate to more affordable areas. This geographic dispersion can exacerbate the trust deficit, as employers struggle to assess the commitment and productivity of remote workers.

However, it is essential to note that productivity isn’t – or at least shouldn’t be – in question. According to statistics from industry analysts, remote workers in the banking and finance sector have demonstrated remarkable productivity, debunking any doubts about their ability to perform effectively when not in a physical office environment. For example, 69 percent of executives surveyed by PWC reported that their employees were as productive or more productive than before the crisis drove them to begin working remotely. At the same time, more than 75% of employees said they were at least as productive as they were pre-pandemic.

In these instances, forcing staff into offices to do a job that they may be more productive and content doing from home, feels counterproductive. Hybrid working is in part about having a better balance between life and work and, whether they realise it or not, businesses need to go some way to facilitate that fact or face attrition. This requires business leaders to provide

appropriate tooling and technologies and to integrate frameworks around teleworking professionals to get the best out of them.

Managing a Hybrid Workforce in Banking and Finance

Collaborating with industry organizations like the Banking Industry Architecture Network (BIAN) and leveraging its standardized architectural framework can provide a blueprint for building scalable and adaptable banking systems, ensuring compatibility and integration between different technology platforms. However, to build on this and continually address the challenges within a hybrid work model, leaders in the sector need to consider the following strategies:

1. Strong Communication Channels: Establishing robust communication channels is essential in fostering trust in the digital workplace. Leverage digital tools to facilitate a more seamless and personalized communication, such as secure modern intranet. Encourage regular check-ins, virtual team meetings, and knowledgesharing sessions to enhance collaboration and innovation while keeping employees connected to each other as well as the tools and resources they need to do a great job.

2. Clear Expectations and Goals: Clearly define expectations and goals for remote and hybrid employees in the banking and finance sector. Ensure that performance metrics and key performance indicators (KPIs) are communicated transparently while shifting from outputs to outcomes. This clarity promotes accountability and empowers employees to take ownership of their work.

3. Flexibility and Work-Life Balance: Recognize the benefits of flexibility in a hybrid work model, such as improved work-life balance, more diverse recruitment opportunities and increased employee satisfaction. Grant employee’s autonomy in managing their schedules and remote work arrangements, while maintaining a focus on delivering high-quality work and meeting organizational objectives.

4. Data-Driven Performance Evaluation: Implement data-driven performance evaluation systems to objectively measure and assess employee productivity. Utilize analytics tools to track progress, identify areas of improvement, and provide constructive feedback. This approach enhances transparency and builds trust through an objective performance assessment process.

5. Continuous Learning and Development: Invest in training programs tailored to the unique needs of the banking and finance sector’s hybrid workforce. Provide resources and opportunities for skill development, keeping employees updated with industry trends and regulatory changes. By investing in their professional growth, organizations demonstrate their commitment to employee success, fostering trust and loyalty.

6. Implement teleworking policies: Teleworkers report better work experiences when they are covered by workplace policies, such as the right to disconnect or being consulted on telework. Average levels of satisfaction with one’s job, work-life balance, mental and physical health are all higher among teleworkers covered by such policies. For example, 79% of teleworkers who are consulted about teleworking are satisfied with their work-life balance, compared to 62% of those who are not consulted.

7. Provide tools and capabilities that ensure employees know they are valued and engaged. They are well communicated to and feel part of something bigger than a transactional work arrangement. That they are productive and can easily access all they need efficiently and effectively. Inspire your employees

Overcoming the Trust Deficit

The lack of trust, rather than productivity challenges, often drives employers to default back to in-office work. However, it is crucial to understand that trust can be established and maintained in hybrid work models. By implementing these key strategies, leaders can address the trust deficit and create an environment that nurtures trust, productivity, and employee wellbeing.

Furthermore, workplace teleworking policies are associated with higher levels of trust between teleworkers and their managers. 89% of teleworkers who are consulted about teleworking report the presence of workplace trust, compared to 59% of those who are not. Similarly, 86% of those who have a right to disconnect report workplace trust, compared to 67% of those not covered.

Evidence suggests that there may be mutually reinforcing relationships between teleworking policies, workplace trust, and remote working take-up. By challenging misconceptions, addressing the impact of the cost-of-living crisis, and implementing effective management strategies, leaders can begin to establish trust among remote and hybrid employees – ensuring the success of the banking and finance sector’s hybrid work model. In the shadow of the recent Silicon Valley Bank collapse and while on the edge of economic uncertainty, embracing these strategies will not only help to drive productivity but also attract and retain top talent in an unpredictable climate.

Christine Wu of Absa Group Limited: Driving Digital Transformation and Innovative Customer Experiences

Headquartered in Johannesburg, with over 150 years of African heritage and having developed a significant footprint across the continent, Absa Group Limited has worked to position itself as a Empowering Africa’s tomorrow, together … one story at a time.The multinational banking and financial services conglomerate has subsidiaries in 12 African countries and representative offices in London and New York. It offers a range of retail, business, corporate and investment banking, and wealth management products and services.

Christine Wu joined Absa in 2019 as an Executive member of Absa Retail and Business Banking business. In 2022, she transitioned to Everyday Banking as a Managing Executive: Consumer product, where she is responsible for ensuring Absa’s overall success in the consumer banking segment. She takes end-toend accountability for core product performance and the transformation into a digital and data first business.

Her portfolio includes transactional banking, card issuing, personal loans and savings and investments. In addition to traditional product responsibilities, she also leads the digital, design and advanced analytics capabilities. Christine has been credited with providing the business with a renewed edge and greater customer centricity. She was also named as 2023’s Business Woman of the Year - South Africa in this year’s Global Banking & Finance Awards. Looking ahead, she is geared up for even greater success, leveraging Absa's strong presence in South Africa with the distinctive data and digital capabilities to create an empathetic digital bank.

Being at the forefront of digital innovations and motivated to cater to the growing needs of customers, Absa has aligned its strategy in the last few years to focus on developing customer primacy and a digital-first philosophy in its delivery, as Christine explained to Global Banking & Finance Review editor Wanda Rich. “As a full-service bank, it was important that we build a digital brand while simultaneously retaining the warm and empathetic touch in all our customer interactions,”

she said. “Over the years, we have strengthened our ability and agility to bring possibilities to life for customers.”

One significant organisational shift was to elevate digital from a utility to a full product management capability. “We don’t think of digital as a competition to land the latest technology, but rather as an integrated set of capabilities to drive meaningful usage and adoption. Today, we can proudly say that our digital products are a key driver to customer loyalty and primacy. On average our digitally and rewards active customers hold 2.5x more products.

Through its digital strategy, Absa works to deliver seamless customer service and efficiency across all aspects of banking by getting the balance exactly right. “It is an important differentiating philosophy for us at Absa Digital. We have learned hard lessons by making legacy decisions to digitise for the sake of efficiency only,” Christine revealed. “This drives the wrong behaviours in the delivery of customer experience. We now believe that we should always prioritise a seamless customer experience. With strong adoption and usage drives, the business will benefit from digital efficiency. As a traditional bank, more than 3/4 of our value segment interact with us through digital channels only. This speaks to the breadth as well as quality of interactions"

She confirmed that this choice has stood the test of time. “Just like most global banks, Absa faced economic headwinds in the latter half of 2022 due to high inflation levels, a rising interest rate environment, and frequent power outages caused by increased incidents of planned power cuts in South Africa. Despite these challenges, Absa continued to deliver its strategic objectives, including advancing the digital transformation journey and further strengthening customer relationships.”

Christine went on to discuss one of the key aspects of developing these relationships – providing clients with a secure banking environment.

“Our ethos of striving for digital excellence, underpinned by a bestin-class, empathetic frontline, allows us to accelerate innovation while providing unparalleled support to our customers. In all of this, safety is always the primary consideration, as evidenced by a number of initiatives that place safety at the heart of all our innovation.

“Our digital identification and verification capability allows customers to open an account by taking a selfie, which is then checked against their Identity Document at the South African Department of Home Affairs for instant verification. Our AI learning bot, Absa Abby, uses artificial intelligence to personalise our customers’ banking experience, proactively recommending products and services and securely performing customer transactions.

“Then there is the Digital Fraud Warranty, a mechanism by which Absa backs up any digital fraud claims with a warranty. This was introduced in 2021 as the first offering of its kind in South Africa. The bank has also deployed multiple levels of defence in terms of strategic fraud monitoring and analytics, backed by state-ofthe-art algorithms to ensure that we can detect and manage suspicious transactions proactively.

“In addition, to reduce our customers’ dependency on cash and further promote the usage of our safe and secure digital banking platforms, Absa joined forces with other South African banks in the first quarter of 2022 to roll out PayShap, South Africa’s new rapid payments technology. We leveraged our significant digital and banking knowhow to launch this important service

to the market, and the response from our customers has been very positive. Since its launch in March this year, we have seen the bank take up more than 40% of the market share in this space."

“Finally, we are also innovating to expand our physical presence in a low-cost manner by leveraging Branch on the Move, a mobile branch capability through which we offer full-value banking services. This aims to support customers including those in underserved and low-income communities. We have pivoted our network significantly, automating cash while ramping up sales and services to enhance the depth and empathy of our high-touch customer interactions. In essence, physical channels are transforming into a space where click and mortar cohabit seamlessly.”

Wanda asked Christine to also talk about the AbsaID facial recognition banking app, an initiative whereby customers can transact securely with the highest level of biometric certification. As she explained, “Safety and security is a top concern for customers and a major priority for the bank. This feature means that your face is, in fact, your password. The initiative is linked to Absa’s banking systems and works across all channels, allowing your biometric to become the instant key to your safe.

“AbsaID Facial Biometrics uses facial mapping technology to verify and identify the customer. It links your unique facial features to your mobile device and creates a security barrier that only you can unlock. Biometric facial recognition technology is a first for our digital banking security and has received highly acclaimed honours, including the Global Banking & Finance Top 100 Companies To Look Out For award for information security and fraud technology.”

By taking fraud prevention seriously and providing secure digital platforms that prevent fraud losses, Absa not only ensures compliance with local and international regulatory requirements, but also delivers a plethora of benefits to its customers with its multiple digital banking offerings.

“Absa continues its strong trajectory of improving our digital channel satisfaction,” Christine said. “This is underpinned by innovative value propositions such as Google Wallet, Absa Advantage, Apple Pay, QR payments, our virtual assistant Absa Abby, AbsaID, and multiple enhancements to our digital security capabilities and self-help content for customers. Our customers can bank on Absa to offer safe and secure banking platforms, and our safety claims are backed up by our unique Digital Fraud Warranty.”

With the trend towards widespread adoption of mobile and online banking increasing rapidly, Absa is taking the opportunity to embrace the benefits of digital banking and give its customers the ability to bank, transact and move money in any way they want. “Shares of digital sales for savings products, personal loans and credit cards have grown exponentially over the last two years. In 2022, Absa's 4 million digitally registered customers performed more than 3 billion digital transactions to the value of over ZAR 3 trillion across our digital channels.

“But for our business, digital is more than just the front-end apps and web channels,” she continued. “It is an overall business model, and each of our functions are going through significant transformation, such as HR completing the Workday rollout, using augmented reality for onboarding to leveraging hyperpersonalisation technology to better engage customers. Absa has transformed itself

from front to back. The overall Group results and strong cost performance speak to the initial benefit of the transformation.”

Christine acknowledged that infrastructure is the core to the success of any digital bank, which Absa sees itself as, and their investment is set to continue for the long haul. “Over the years, we have made significant investments into our data infrastructure, modernizing our network and storage. We are also continuously improving and modernising our digital platforms. This will be a significant and continuous investment for Absa.”

She ended by discussing what the future holds for Absa. “We have developed a comprehensive product roadmap to expand our ability to provide a full set of financial services to our customers in an intuitive, integrated and predictive manner,” she said. “Using our various digital products to expand financial inclusion is also a key area of investment for us. Underpinning these two strategic outputs, there are several capabilities we feel will differentiate us.

“As our offering becomes more comprehensive, we are placing increasing investment into conversational UX. Taking our Abby chatbot to the next level of maturity and taking advantage of the rapidly evolving generative AI is critical. Our ability to leverage data to provide our customers with relevant insights to manage their lives better is an ongoing investment and will continue to be a strong focus area.

“Digital security is more important than ever,” she added. “We will continue with solid user education, coupled with more sophisticated algorithms and strong identity management.”

Banking and AI:

how can we ensure ROI?

Marshall Choy SVP of Product SambaNova Systems

Generative AI has established itself as a cultural phenomenon in recent months, but now enterprises want to know how AI can work for them. For the banking industry in particular, the advent of artificial intelligence (AI) in the enterprise represents a tremendous opportunity and one that is not to be missed.

By leveraging AI technology and solutions, early-adopting financial institutions can significantly reduce costs, create new efficiencies in their operations, and ensure tangible return on investment (ROI). This, in turn, has the potential to boost profits and drive higher returns for shareholders.

Financial institutions that choose to forego the use of generative AI models in their customer interactions are missing out on the potential benefits that AI can bring. Without it, you get a less comprehensive view of customers which could result in missed opportunities, customer churn, and steadily decreasing returns on technology investments.

With a large proportion of banks already using AI on a day-to-day basis, and more and more taking steps to incorporate AI into their daily operations each day, the potential is clear to see.

Improving fraud detection and risk management, reducing overleveraging, and bettering customer service are all key components in the era of AI-powered banking.

Keeping your customers engaged

Given current economic challenges, customer engagement and user experience are quickly becoming front-end priorities for retail banks and other financial institutions in order to retain or grow their customer base. Many are relying on AI-driven technologies to facilitate and enhance these processes.

From customer-facing generative AI that uses generative models to provide automated, tailored support and help customers access the services they need, to datadriven insights that help financial institutions understand customer behaviour and preferences, generative AI platforms are already revolutionising the way banks interact with their customers.

The implementation of customerfacing generative AI may seem like a large investment. However, the payoffs aren’t just long-term pipe dreams. The benefits of increasing the number of loyal customers can be measured in the short term as marginal gains over close competitors. By putting generative AI to work in customer service, customer queries can be handled quickly and efficiently, and banks can automate processes such as onboarding, fraud detection, and customer segmentation, resulting in cost reductions and better visibility into the needs of your customers.

Generative AI is becoming increasingly useful for improving the customer experience, as the value of stored datasets can be unlocked with the implementation of foundation models. These pre-trained generative AI models, either built in-house or through third-party service providers, enable banks to quickly process millions of datasets that are located across different environments, allowing them to identify common solutions to recurring issues and inform their customer interactions. As these datasets often contain unstructured data, such as customer emails and phone calls, generative AI can help banks to make sense of this information and improve their customer service. In turn, this will lead to happier customers and reduced churn rates.

Staying Compliant with AI

Customer experience is, no doubt, a key part of banking in 2023. But compliance will remain as important as it has ever been – and that’s where AI comes in to balance these obligations. Foundation models offer a level of monitoring that is not only round-the-clock but also able to detect any suspicious activity instantly, thus providing a layer of insulation against hefty fines from regulators.

By automating KYC and KYB processes, you can expedite onboarding times: directly influencing customers’ satisfaction levels and boosting retention. Moreover, continuous generative AIdriven risk monitoring negates some of the pressure on human personnel when it comes to detecting fraudulent activities.

In today’s digital arena, where consumers expect quick and secure services as a bare minimum, using these new tools to their fullest extent could be the difference between winning a new customer or losing them to your fiercest competitor.

Owning AI models

The banking sector has become increasingly reliant on cloud technology to keep up with competitive rivalries and scale activities. Following its rapid rise to prominence, however, AI is helping banks to look beyond the cloud and bring greater data control to operations.

Speed, security, and efficiency are vital criteria for financial institutions and their operational investments. To achieve these goals, banks have been turning to purposebuilt large language models (LLMs) as a proven, capable, and profitable investment. Through the implementation of these LLMs that are built on a bank’s own unique data, banks can increase their operational capabilities and customer experience,

without concerns over data privacy. Instead of storing valuable customer data in the public cloud when using AI, businesses should look to secure foundation models that provide greater control over how data is used, as well as ownership of the model itself.

The fourth industrial revolution is here. Generative AI is here to stay, and that goes for the banking industry too. Banks have taken their time to evaluate and adopt these new technologies in the past, but with rivals already on the move, and generative AI firmly in the public consciousness, now is the time to act.

AI exists to augment the capabilities of the bankers already in the job: giving them roundthe-clock risk monitoring, automated customer onboarding, and generating insights from their unstructured data. By implementing this technology, we can free up the people in a firm to do their best work and ensure maximum return on investment.

Hemera Capital Partners: Identifying Diverse Opportunities Too Big To Be Ignored

Mário Amaral Managing Director & CEO Hemera Capital Partners

Geneva-based Hemera Capital Partners (HCP) is an independent asset management and investment banking firm with a focus on Southern Africa. HCP’s presence combines with local offices, close to the markets and opportunities of interest, and it plans to open an office in London, UK this year in order to allow greater proximity between international investors and local markets.

As the first local operation and in proximity to its target markets, it commenced operations in Angola in 2019 with the acquisition of a local Asset Manager regulated by Angola’s Capital Market Commission, and grew into a market leader by growing assets under management to AOA 270 billion (~USD 516 million), split across Mutual, Cash Management, Real Estate and Venture Capital funds. Its highly skilled investment banking teams are experienced in M&A, Structured Finance and Capital Markets in Angola as well as in the European, Latin and North American markets.

Mário Amaral is the Managing Director & CEO at Hemera Capital Partners - Asset Management. Before joining HCP, Mário was a Director at QWC LTD, supporting banking institutions in managing their portfolio of nonperforming loans. Prior to that, he co-founded and was the Head of Real Estate and Private Equity funds at Odell Global Investors, the first Angolan Asset Management firm incorporated under the country’s new legal framework implemented in 2012. In 2012 he worked for Banco Millennium ATLANTICO, the fourth largest bank in Angola, as Senior Associate in the Investment Banking Department, leading teams in M&A and Structured Finance deals over various sectors, such as Real Estate, Financial Institutions, Agribusiness, Energy and Healthcare. He started his career on the European Valuation Centre team of Willis Towers Watson in Portugal, as an actuarial pension scheme analyst for UK-based companies. Mário holds a master’s degree in Finance from the Brookes Business School in Oxford, UK, with postgraduate studies in Banks and Insurance Companies Management and a degree in Finance, both earned at ISEG in Lisbon, Portugal.

Mário spoke with Wanda Rich, editor of Global Banking & Finance Review, to answer her questions on Southern Africa’s economic potential, the opportunities HCP has identified for investors, and the range of different funds it offers in order to capitalise on them. He also provided insight into its H-IMPACT initiative, which drives impact through the support of clients’ sustainability strategies and ESG activities.

What differentiates Hemera Capital Partners’ approach to fund management from your competitors?

Over the years, our focus was on structuring and developing transactions, mapping the risks and local business environment and, ultimately, building and managing investment mechanisms that allow our target markets to reinforce their connections to the international financial system. We feel the responsibility to lead the market by offering investment alternatives that meet potential investors’ needs and provide them with solutions that go beyond the traditional savings and funds offered by local commercial banks.

We believe that our market has unique opportunities for innovation and growth, in which each player takes the responsibility of performing a key role in developing a mature market aligned to the best international practices to approximate themselves to the markets and attract international investors. Our focus is the innovation, promotion and development of the market through the creation of new vehicles and financial instruments among the different asset classes in order to respond to the investor’s needs, so we launched a fund that was the first of its kind in the Angolan market—and still is the only money-market open-ended mutual fund available for investment on a daily basis in the country— and a Fixed Income Closed Ended Mutual Fund as a currency protection. We also launched the first Closed Ended Real Estate Fund, and the first Venture Capital fund that invests in different stages of startups and SMEs looking to achieve both financial and social return.

What we believe to also differentiate ourselves is the investment that we make to understand the investor’s needs and to identify the opportunities in the market. In that respect we created an internal research department, to design innovative financial instruments that are investor-oriented (both local and international), financially sustainable, ESG compliant and aligned to international best practices.

What do you see as the economic potential in Southern Africa?

The expectations surrounding African economic growth have enticed investors looking for opportunities with high returns since the early 2000s. With its population estimated to reach 1.5 billion by 2025, progress needs to be made towards addressing key socioeconomic regional issues such as poverty reduction and improved worker productivity, as well as vital business needs such as access to capital, mobility of goods and services between the continent’s markets, and investment in essential infrastructures such as power and rail.

Southern Africa’s GDP of $1.3 trillion contributes ~20% to the continent’s $6.8 trillion GDP, after West Africa’s as the largest contributor at 26.3%. Southern Africa’s three biggest economies—Angola, South Africa and Zambia— contribute about 81.9% of the region’s GDP.

Africa and Southern Africa have been strengthening their bases for sustainable growth, with a combination of increasing institutional maturity, openness to foreign investment, and a focus on innovation. The region has been confirmed as one of the leading areas of world growth for the coming decades by a variety of business indicators. It is an investment opportunity that is almost too big to be ignored by investors who, if they want to succeed, need to position themselves appropriately to be able to take part and enjoy successful investments with high potential returns.

The region is ripe with opportunities from key sectors, so investors now need to take a global, data-driven and locally insightful approach, to enable them to identify the real trends across the region’s industries and uncover the best investment opportunities across industries such as Agriculture & Food, Infrastructure, Technology and Services.

Despite the challenges, Southern Africa is a region that presents diverse opportunities, where knowledgeable and locally and regionally savvy investors can expect sustainable returns.

What are the current opportunities you see for investors?

Over the last few years, a great range of opportunities has emerged for investors. The Angolan government has made a great effort, along with the main financial and investment entities, to create the right environment for attracting investments, to implement a new private investment law to ease the entry of investors, and to expatriate dividends. The Angolan Capital Markets Commission (CMC) has been playing an important role in this process, by the creation of a regulatory framework promoting a secure environment for investment on a wide range of financial instruments. The Angolan Stock Exchange (BODIVA) allows the trading of different types of financial instruments available to investors with rules (self-regulation), systems (platforms) and procedures that assure market fairness and integrity. Both institutions, among others, have contributed and created the necessary means to launch the Angolan Privatisation Programme (PROPRIV). The programme started in 2019 and identifies 195 state-owned enterprises to be privatised during a period of four years (2019-2022), covering diverse sectors such as oil and mineral resources, telecommunications, finance, transport, hospitality, tourism and agriculture. Some of the companies already have international investors in their structure. The programme has already privatised 96 assets and has been extended to 2027, to give continuity to the privatisation process of 68 more assets that have been recently included. In 2022, two main banks made an IPO (Initial Public Offering); one is the largest bank in the market, valued at USD 1.5 billion to date, and the other is an international Portuguese bank. The transaction gave the public the possibility of investing in their shares and diversifying their investments. It is expected that companies in the energy sector may go public by issuing shares and corporate bonds in 2023.

• Luanda Bay and Luanda Marginal

Additionally, we believe in local entrepreneurship, and over the last few years we have been dedicated to the mapping and knowledge gathering of the startups ecosystem which culminated in the creation of our Venture Capital fund, where we believe there are great coinvestment opportunities for international investors looking to invest in this sector.

Finally, despite the current market size, which has great growth potential, the opportunities of investment range from the Money Market Mutual Fund and Fixed Income Mutual Fund, to the Venture Capital and Real Estate Fund, in which we have a strong real estate team with experience in managing and developing real estate projects. Today, international investors have more flexibility to enter and exit the Angolan capital market, as the Central Bank has introduced new regulation that allows less bureaucracy for foreign investors, providing clear understanding on how to proceed.

Can you tell us about the different funds you offer and their advantages?

Hemera Capital Partners has a combination of different funds that allows a diversification of the investment portfolio, and the achievement of sustainable returns in the medium and long term, taking advantage of the country’s economic potential. We offer services of Asset Management by designing specialised investment mechanisms, aiming to structure, create and manage investment funds and several types of assets, including property, securities and alternative assets. We also create captive funds and tailormade vehicles with our discretionary services. We have Structuring and Advisory services that rely on the capacity to generate transactions that deliver unique strategic opportunities for our clients, with appropriate terms and conditions and a well-developed risk profile, in line with the best practices in the industry.

HCP, currently, has four funds under management:

• Fundo Liquidez (Money Market Mutual Fund, the first open-ended fund in Angola), which invests in deposits and money market instruments. The fund currently has more than 150 investors and is seven years into operation. The investors range from institutional investors to large corporates and individuals. It seeks to provide its investors with an investment with low volatility, and a level of potential return that is stable and above the alternatives offered by traditional savings and deposit products. It mainly invests in money market securities and term deposits with a residual maturity of less than 12 months.

• Fundo Atlântico Protecção (Fixed Income Closed Ended Mutual Fund - Exchange Coverage, the first in the market), which invests predominantly in Angolan indexed sovereign bonds (AOA to USD). This was created in partnership with Banco Millennium Atlântico (ATL), one of the largest banks in Angola.

• Pactual Property Fund (Closed Ended Real Estate Fund, also first in the market), which invests predominantly in mature assets with medium/long-term rental agreements with tenants who have a high credit rating. The fund has more than 170 assets under management. There is a short/medium-term strategy to list part of the fund in the Angolan Stock Exchange. https://www. pactualpropertyfund.com/en/properties

• Dual Impact Fund (Venture Capital linked to the 2030 Agenda for Sustainable Development Goals [SDGs]), which invests in different stages of startups and SMEs with financial and social returns. It provides long-term finance to support the growth of the target company and achieve the SDG. https://dualimpactfund.com

Can you tell us about Hemera Capital Partners’ impact initiative?

The subject of impact has been a part of HCP’s DNA since the company was established. Our commitment is to achieve long-term sustainability in the creation of value, and to rethink the dynamic of business under the principles of shared value, which led us to create H-IMPACT, our initiative to drive impact and sustainability, providing support with the client’s sustainability strategy, policies and processes, as well as the design and implementation of ESG metrics and initiatives.

In 2022 we structured the aforementioned Dual Impact Fund, the first impact fund in Angola which, through its investment policy, aims to target investment opportunities which can both generate financial returns as well as have an impact by addressing social and environmental issues. The fund is sector-agnostic but is looking to invest in preferred sectors such as Health, Education, E-Commerce, Financial Business, Mobility, etc.

In 2021, Hemera Capital Partners promoted an event, the Angola Sustainability eSummit, organised by H-IMPACT, that took place on the 25th of May. It was the first e-summit on sustainability in Angola and addressed the key roles that sustainability and sustainable finance can play in the country’s socio-economic growth, as well as in attracting international investment. We had an impressive array of speakers, such as the UN Resident Coordinator in Angola, Ms. Zahira Virani, in representation of His Excellency António Guterres, the Secretary General of the UN, Ms. Tanya dos Santos, Global Head of Sustainability for Investec, Ms. Portia Bangerezako, Head of Sustainability for Sanlam, Mr. Ottoniel dos Santos, the Secretary of State for Finance and Treasury, Ms. Maria Uini Baptista, the Chairwoman of the Board of Directors of the CMC, Mr. Walter Pacheco, the President of BODIVA, and Mr. Hector Gomez Ang, the Representative of IFC in Angola, among many others.

Key materials:

1. The Angola Sustainability eSummit that took place on 25 May, 2021: https://www.youtube. com/channel/UCAUg-G_ lf5LizT5yM0HGIgA

2. In 2022, HCP became a signatory of the PRI (Principles for Responsible Investment): https://www.unpri.org/

3. In 2022, HCP became a member of UN Global Compact: https://www. unglobalcompact.org/

4. In 2020, HCP issued a Sustainability Report, available on the HCP website: https://www.hemeracapitalpartners. com/ content/download/reports/15062021_ SGHCP_RC_2020_vF_ Web.pdf

How has Hemera Capital Partners adapted to the current pandemic?

The year 2020 was marked by the global pandemic caused by COVID-19, which made a significant social and economic impact on the world, especially in the way we work, do business and interact with one another in general.

HCP quickly adapted to the new reality imposed by the pandemic, with the creation and implementation of a contingency plan to guide all the biosafety measures to be taken by employees, which follow the best international practices and are defined by the local official health agencies. HCP ensured the progressive return of employees to the workplace and had to rethink the business strategy.

At the beginning of the pandemic, HCP put a continuity plan in place by adjusting its business strategy to the new reality. In that period, it created a set of partnerships with institutional investors that allowed us to more than increase our assets under management (AuM).

We established partnerships with some local and international entities, such as banks for trading the shares of the funds under our management, private and institutional entities to collect industry data of the market to identify and map investment opportunities, and players from the local financial industry to understand the impact caused by COVID-19 and the challenges faced by investors and companies in the market.

Are you launching any new funds this year?

Yes. These will essentially be mutual funds which we believe will be innovative financial instruments to private investors and companies. We are currently looking to structure equity funds and pension funds for retail investors.

What are the future plans for sustainable development?

We see great potential in our market on this subject, and are currently structuring and developing our business model in a sustainable fashion. We are finalising the ESG integration into our strategy and the business model. We intend in the short term to strengthen the sustainability in our strategy that, across our company, prioritises the following seven themes:

1. Risk management and compliance

2. Integration of ESG into HCP activities

3. Ethics in business

4. Attracting and retaining talent

5. Diversity, inclusion and nondiscrimination

6. Investment performance

7. Cybersecurity

We believe that strategic focus on these areas will allow us to continue to develop our business in a sustainable and financially viable way, as well as to better prepare ourselves to contribute and accompany the development of the financial markets and maintain ourselves as a major player.

• Hemera Capital Partners Team

Preparing for turbulence: building business resilience for 2023 and beyond

No matter where you are in the world right now, economies are struggling. Geopolitical tensions, rising inflation and interest rates, and many other external factors, continue to impact businesses across the globe.

The UK, for instance, just reached the country’s highest interest rates since the 2008 financial crisis. And this news follows on from higherthan-expected inflation data which continues to remind us of the challenges businesses are facing today.

But these disruptions aren’t happening in isolation. We’re seeing a ripple effect on multiple industries and individuals, with those less prepared to weather such challenges taking the biggest hit.

It’s clear that prioritising the development of resilient strategies is vital in the face of volatility and uncertainty. But what exactly do leaders need to prepare for? And what should be prioritised to make resilient operations a reality?

Where are businesses experiencing the most turbulence?

There are many concerns for business leaders today – many of which are having simultaneous and substantial impacts on international and local business environments. From rising inflation to the increased cost of doing business, supply chain disruptions, higher interest rates, continued monetary policy tightening, the sustained impact of the pandemic and Brexit, as well as geopolitical instability.

Companies are facing a rocky environment, where rising costs are meeting a decline in customer demand as inflation and higher interest rates tighten purse strings across the world. And, there’s no telling when these threats will be minimised or removed.

The best course of action for businesses facing an uncertain future is to adopt proactive measures to enhance their resilience amidst such challenges. Being in a position to actively understand and minimise risks is fundamental to an organisation’s capacity to successfully navigate turbulent times. But what does this actually look like for businesses today? Let’s dig a bit deeper.

Edgar Randall Managing Director Dun & Bradstreet UK&I

What’s required to weather the storm?

It’s one thing to say, “businesses need to be proactive,” but it’s another to consider this in practice. Actively minimising risk and ensuring resilience means having the right information to hand so you can make those proactive decisions for the good of your business. This means understanding your organisation – inside and out.

To truly know your business, having access to the latest data is vital to getting insight into every level of the organisation. From internal data concerning customer communications to external information such as market stability or supply chain issues.

We found that an overwhelming majority (77%) of business leaders believe data will play a crucial role in helping their business navigate the turbulent times ahead. But just over a quarter (27%) rate their business’ resilience during turbulent times as “extremely resilient”.

It’s clear there’s a disconnect between using data effectively and being prepared for challenging events on the horizon. And it’s critical that a larger portion of businesses develop a higher level of resilience to remain solvent, and agile, to change – all while readying themselves for growth and innovation.

So, what’s getting in the way of businesses struggling to use their data and ensure resilience?

It’s time to head in the right direction

If you’re using a broken compass to navigate, you’ll likely end up going the wrong way. You will need fix the compass if you want to get to your destination. The same goes for those at the helm of their business trying to navigate without the right tools to do so effectively.

According to our research, 80% of organisations are struggling to manage the volume, variety and velocity of their data. In short, they might have the information they need to point them in the right direction but don’t have the ability to process the data to make a decision on the best course of action.

This is reinforced by 85% of business leaders stating they currently do not use data to understand disruption in their ecosystem. Which also means that as little as 15% of businesses are using insight from their data to build a strong understanding of the challenges their company is facing to inform resilient, risk-adverse strategies and spot opportunities.

Businesses need more guidance. They need the right tools to understand their data and help make the best decisions for their business no matter the disruptions that lie ahead.

Facing the challenges ahead

While it’s important for businesses to minimise risk and protect their assets during times of economic uncertainty, our research highlighted a healthy appetite for growth and

opportunity among leaders – with 34% reporting they are using data in their organisations to drive growth.

Organisations that can navigate risk, will be the same ones set up to identify and pursue opportunities during challenging times and even emerge from economic downturns stronger than ever.

Whether you are looking to better understand the current state of turbulence in your market or identify opportunities to remain competitive during uncertainty, prioritising business resilience with a strategic, long-term approach is fundamental. And this means utilising data to scenario plan and model outcomes – ensuring your business decisions are backed by trend analysis and predictive analytics.

For example, ensuring a flexible supply chain aided by data-driven insights could be the difference between responding rapidly to unforeseen events or operations coming to a grinding halt. We all know which one we’d rather become reality.

The hurdle isn’t about needing more leaders to value data in their decision making, rather it’s the business’ ability to unlock the true value of its data. Getting this right – with access to technologies that help you process and analyse your business data – will provide valuable insight to increase business resilience. So, your organisation can face any challenges on the horizon –no matter how sustained or extreme they might be.

Banking on data: How storage powers digitalised banking

The pandemic led to a surge in the adoption of online banking apps in the UK, as traditional banks faced the challenge of increased digitalisation, with the largest increases being for the use of mobile banking applications, as research from UK Finance.org shows. In addition to this, the research reveals that 81% of surveyed adults consider the quality of online experience as a determining factor when choosing a bank. In this rapidly evolving landscape, challenger banks have emerged as formidable competitors, who prioritise on giving an exceptional digital-first experience. To remain competitive, traditional banks must take note of this trend and invest in their own digital offerings to deliver a seamless experience for its existing and emerging customers.

Banks have recognised that technological advancements alone are not enough to attain true digital transformation. The sector needs to consistently invest in its infrastructure to ensure trustworthiness and reliability from its customers. As more customers rely on online banking applications, providing a seamless user experience becomes imperative to stand out in a growing market. Effective storage solutions form the backbone that supports and maintains effective customer access in the digital banking ecosystem. By prioritising customer experience and safeguarding data, the financial services sector can effectively support the growing demand for digital banking services and deliver a superior user experience for all customers, regardless of age or demographic.

Grigory Nikonov Systems Engineer Western Digital

The Big Short(age of Storage)

The way customers interact with their banks and financial institutions has changed significantly, from paper-based files to storing customer information online and in the cloud. According to a recent Parliamentary debate, there are approximately 5,000 banks on UK high streets in 2023, which is a 75% decrease on the number of branches there were in the late 1980s. This shift from brick-andmortar banks to digital, and the rise of neobanks (banks that solely operate online with no physical presence), has caused a significant increase in the production of data and metadata. In turn, these rising quantities of data require constant, scalable, and more innovative storage solutions. The volume of collected data will vary bankto-bank, and their storage needs will vary too, all depending on the digital operations of each bank. Regardless, all banks – whether a hybrid of brick-and-mortar and online or a neobank – are now requiring more robust storage solutions to facilitate the running of their business due to their enhanced presence online.

Before the advent of modern banking, banks only stored basic customer information, such as customer names, dates of birth, addresses and bank account details. However, with the rise of digitalised banking, financial institutions have started to collect more insightful data around customer transactions . This includes metadata around customer spending patterns to determine potential credit risks, implementing risk management processes and information collected during customer surveys. With the increasing implementation of artificial

intelligence (AI), banks collect insights which need to be effectively stored, managed, and secured for individual data protection and security. Financial institutions need to evaluate their current storage requirements and implement more scalable, effective solutions to handle growing data needs.

Flash storage, which includes solidstate drives (SSDs), has been widely used by businesses and financial institutions since the late 1980s because of its fast performance and low delays in retrieval times. SSDs can enable faster access to data (so-called ‘hot storage’) compared to traditional hard disk drives (HDDs), which are respectively known in the industry to storage and manage ‘cold’ or ‘warm’ data.

UK banks can leverage flash storage to expedite data intensive tasks, such as processing their customers’ transactions and analysing information in real-time. However, both ‘hot’ storage (SSDs) and ‘cold’ storage (HDDs) play important roles in data management. ‘Hot’ storage is crucial for live and active information that banks require immediate access to, such as transactional data. On the other hand, ‘cold’ storage is used for storing inactive and archival data. HDDs might not provide the same access speed for data retrieval, but they offer higher capacities and are more cost effective due to a lower price per terabyte and other total cost of ownership (TCO) variables. When it comes to archival data, the key consideration is the level of accessibility required. While both data backups and archives are retrievable, it can take between minutes and hours to retrieve ‘cold’ storage data from archives. This can involve manual searches and can vary on the type and size of the data stored.

Modern banking now means institutions are incorporating data analytics and AI capabilities into their storage solutions. In fact, one analyst expects the AI-powered storage market is to be valued at around $25 billion by the end of 2025 . AI can be used to identify and optimise a bank’s data storage requirements, segment the data into live and archival data, and even automate storage management processes and timelines.

Keeping Up with the Challenger Banks

Digital and brick-and-mortar banks are under pressure to keep up with changing expectations around providing the ultimate customer experience. This requires both high performing and high-capacity storage solutions to ensure the experience is frictionless, and customers have quick access to their data and services.

The future of online banking will lead to increased convenience for customers, but banks must make sure they have the right infrastructure in place. To remain competitive, banks must enhance their storage solutions to stand out in a crowded market. The rapid growth of digital banking has led to vast amounts of live and archival data. By investing in scalable and secure storage solutions, banks can provide personalised customer experiences. Real-time transactions and data-driven insights will be worthy of consumer confidence, developing a solid foundation of trust with both new and existing customers. Efficient storage solutions will form that backbone to enhance the sector.

Dynamic authorisation: overcoming the limitations of zero trust technology

The limitations of zero trust technologies

Zero trust is no longer an optional extra for cyber security leaders – today it has become a fundamental way of working for modern businesses, especially in the financial services arena, where stakes are high. In enabling enterprises to optimise their cybersecurity posture, the zero trust model relies on the practical application of a golden rule: trust no-one.

With the challenges of shifting workforce dynamics, evolving business models and more complex tech environments that are increasingly vulnerable to security breaches, zero trust has gained in importance with the explosion of devices entering networks. The combination of more attack surfaces and increasingly borderless networks throws up weaknesses for organisations across all industries.

With more strategic targeting of critical infrastructure, attacks and risks are particularly increasing in IT, financial services, transportation and communication systems. Research by Sophos shows that ransomware attacks on financial services businesses have increased 34% between 2020 and 2021, with 55% of organisations hit in 2021.

While there are a variety of ways to implement a zero trust approach to security, existing solutions are focused on network-centric zero trust, and do not address the three critical access control levels – access to the network, access to applications and access to intraapplication assets.

The good news is that there are dedicated technologies to address the aspects of zero trust, especially around network access control and advanced authentication. Solutions that are most heavily promoted as supporting zero trust include gateway integration and segregation, secure SD-WAN, and secure access service edge (SASE).

But despite the protection features they provide, there are limitations of the technologies in focusing only on network-centric zero trust which means that without a comprehensive approach, true zero trust protection is simply not possible.

Today’s digital enterprises are driven by complex environments that are highly distributed with hundreds of applications, many systems, hybrid legacy and “cloudified,” microservices-driven infrastructures. This means that they support hundreds, perhaps thousands, of continually changing roles and each change requires the creation of a new access scenario.

Financial services’ approach to zero trust

The key role of a zero trust architecture is to make the critical decision about whether to grant or deny access to a resource by constantly verifying user identity, what the user is accessing and the context of the access against the access policies.

Preventing and detecting cyber threats is a central concern for financial services organisations. To have complete confidence in their zero trust framework, a financial services organisation must first understand their complex environment and vulnerabilities, as well as have a clear zero trust strategy that is widely shared throughout the organisation.

Gal Helemski co-founder and CTO PlainID

In the financial industry, zero trust eliminates some of the common assumptions made by alternative approaches, for instance, that user identities have not been compromised and that all users – once in the network – are operating responsibly. This ensures that they are not hostile insiders or threat actors.

Why dynamic authorisation matters

To this point specifically, thwarting the attempts made by increasingly intelligent hackers with a complex authorisation process – dynamic authorisation – has become the way forward to solve zero trust in financial services.

Dynamic authorisation is a superior approach that grants finegrained access to resources, including application resources, data assets and any other asset in real time, precisely at the time of access.

It drives two processes that are essential to zero trust: runtime authorisation enforcement and high levels of granularity. For instance, when a user makes an attempt to access the network, application or assets within an application, this kick-starts the evaluation and approval process that covers key attributes. These include: User level (their current certification level, role and responsibilities) and whether they can access confidential and personally identifiable information (PII). It also includes asset attributes, such as data classification, location assignments and relevant metadata.

Also assessed is the location that the user is authenticating from, i.e. if it’s an internal or an external system. The number of authentication factors being used are also analysed, as is the time and date of authentication. There are even additional tech environment considerations, for instance the risk level of the system.

Taking into account all of these and all other relevant attributes, the policy engine makes the decision at that point of access during runtime. More than this, it makes a new decision each and every time access is attempted, – in real-time. This decision factors in all the attributes that are updated to that specific point in time with the highest levels of granularity, within the real-time context and environment, rather than judging using any attributes that were predefined by the application. True zero trust is multi-level

In an era where the tactics and technologies employed by bad actors are becoming more challenging to address with legacy security solutions, zero trust is a mature and robust approach to reducing the risk and damage of a security breach.

However, taking the right approach to zero trust is critical. If a financial services organisation’s leaders are to have complete trust in their zero trust framework, it is essential to ensure that they are addressing each of the three levels of zero trust access control – access to the network, applications and intraapplication assets with dynamic authorisation intrinsically featured as part of this process.

Currency cure:

Should the Fed and the BOE adopt an “Atlantic Declaration” on CBDCs to avert further banking crises?

In the global race to launch a central bank digital currency (CBDC) and revolutionize the way we transact and store value, the US Federal Reserve (the Fed) and the Bank of England (BOE) are lagging. The Fed is still at the research stage of thinking about CBDCs, while the BoE’s consultation paper is unlikely to result in a digital pound before 2030. Meanwhile, the European Central Bank, which has to navigate the disparate opinions of 27 EU member states, could launch a digital euro as soon as 2027.

The regulatory, structural and political complexities of switching to an entirely new digital currency are irrefutable. Nevertheless, the Fed’s and the BoE’s leisurely approach to CBDCs fails to recognize the critical role that CBDCs could play in steering the banking sector to calmer waters. With bank share prices still volatile and many balance sheets too dependent on bonds and the overleveraged commercial property sector, the worst of the banking crisis may still be to come – with more Silicon Valley Bank (SVB) and Credit Suisse-style casualties on the cards. Far from being a “solution in search of a problem”, this is the kind of scenario that CBDCs could help to avert. With the US and UK recently illustrating their historic bond through the launch of an ‘Atlantic Declaration, ‘ the Fed and the BOE should seek to align the introduction of their respective CBDCs to restore global economic stability for the following reasons:

• Enhanced oversight and better decisions: The banking system is report-based and opaque. As a result, central banks and regulators come to crises late, having to react to the kind of implosions we have seen with SVB and Credit Suisse. CBDCs mean money and financial instruments become ‘code’. If adopted, they could provide a backbone to the monetary system that would give central banks a much clearer insight into banks’ positions and a better overview of the monetary system as a whole. With a transparent CBDC-powered system, the Fed and the BOE could see what is happening within banks in real time, with early warning systems prompting responsive rather than reactive decision-making.

• Transparency over policy impact: Central banks have intervened frequently over the last two decades, with quantitative easing and interest rates deployed so often that the sector has developed vertigo. Moves such as the BOE considering overhauling the deposit guarantee scheme following SVB’s rapid collapse suggest central banks seek greater control over the financial system. Introducing CBDCs would provide a better understanding of the impact of such interventions. If the whole monetary system is code, central banks could run simulations, and stress test the impact of their decisions in different scenarios before taking action. For example, a central bank could ask, “What happens to small banks’ balance sheets if we increase the interest rates to X?”

Leon Gauhman chief strategy officer and chief product office for product design consultancy Elsewhen

• No more ‘bank run’ headlines: Nothing creates panic quite like a bank run, with customers fearing for their deposits and the media feeding off that anxiety. In the era of CBDCs, however, it becomes possible to break up the role of banks and take away their responsibility for deposits. Customers don’t need a safe if money is digital because it’s all recorded on the CBDC’s distributed ledger. This makes the bank’s role as a middle link in the chain between the money created or taken out of the system redundant because a distributed ledger-based system doesn’t need anyone to manage payments or run a ledger. Functions such as underwriting would still be needed, but these could be done digitally or by AI. If there is no custodial role for banks, this greatly reduces the risk of a bank run.

• A coordinated Fed/BOE move: As recent bank collapses demonstrate, banking crises know no borders. What starts in one country rapidly spreads to others. With another potential global banking crisis looming, there’s an opportunity for the Fed and the BOE to develop a coordinated approach to implementing CBDCs that could help mitigate systemic risks arising from the interconnected nature of the global financial system. This could take the shape of sharing advanced information about the health of the financial system and collaborative stress testing, including playing out different scenarios on a global scale. This co-operative approach could minimize the chances of another local SVB-style crisis migrating to other markets, helping stabilize and control the international financial system. There is also the opportunity for the BOE and the Fed to work together on robust protocols to defend a CBDC-based financial system against cyber attacks.

Final Thought:

Already, it’s possible to imagine Fed and BOE decision-makers nodding sagely and putting the question of CBDCs in their pending piles. It doesn’t need to be that way. The current time frame for launching CBDCs is years long. But the next banking crisis will require a much faster response. Even if they can’t avoid the next banking crisis, there is an opportunity for the Fed and the BOE to use such a crisis to fast-track CBDCs in a similarly agile way to the rapid introduction of genetically modified vaccines to combat Covid.

The technology to enable CBDC roll-outs already exists and could be adapted rapidly. What’s missing right now is the political and economic will to do it. In a similar way to the Covid pandemic and the ultra-fast vaccine roll-out, a banking crisis could provide just the catalyst to make it happen.

Data has become the most valuable asset for companies of all sizes. By 2023, the big data analytics market is set to reach $103 billion.

The sheer volume of data being generated and stored by businesses has increased exponentially over the past decade, leading to increased risks and vulnerabilities associated with data breaches. According to IBM, the average cost of a data breach in 2020 hit a whopping $3.86 million . This not only impacts a company’s finances but also its reputation and customer trust, and can even breach regulatory compliance. Resulting in companies seeking efficient and reliable data security to protect their assets and maintain their operations.

Below, Simon Pamplin, CTO at Certes Networks discusses just why data security needs to be at the top of the C-Suites agenda, the importance from a network and data security perspective and the repercussions of a data breach to the C-Suite and the personal ramifications should a breach occur.

Data Security:

Why the responsibility sits with the C-Suite

Core responsibilities of the C-Suite:

The C-Suite’s responsibility sits further than just overseeing the management and operations of a company, from financial performance to strategic planning, and risk management.

According to the National Association of Corporate Directors, the core responsibilities of the C-Suite can be summarised into the following areas:

• Strategy: Developing and approving the company’s overall strategic direction and ensuring that it aligns with the company’s values and objectives.

• Financial Performance: Overseeing the company’s financial performance, ensuring that it meets its financial goals and objectives, and maintaining accurate financial records.

• Risk Management: Identifying and assessing the risks associated with the company’s operations and developing strategies to mitigate those risks.

• Corporate Governance: Ensuring that the company adheres to ethical and legal standards, including compliance with regulatory requirements and the protection of shareholder interests.

But how does the management and security of data fall into these responsibilities and why.

Why data security sits at C-Suite level

A data breach can result in financial losses, damage to the company’s reputation, and even legal action, all of which can negatively affect the board’s ability to fulfil its responsibilities.

Theft of customer data can have serious consequences not only for the business as a whole but for the individuals responsible for the business. In most recent cases CEOs have received suspended prison sentences and lost their jobs –highlighting just how important data protection is at the board level.

So just how is a C-Suites responsibility affected when a data breach occurs:

• Strategy: A data breach can cause serious disruptions to operations, leading to losses in productivity and revenue. Impacting the company’s ability to achieve strategic objectives and in some cases cause complete revisions in strategic direction depending on the data breach’s severity.

Simon Pamplin CTO

Certes Networks

• Financial Performance: With the average data breach costing millions, significant financial losses are not only at the fee for a breach but cascade to costs of incident response, investigation and further legal fees. These are the short-term affects but in the long-term these losses can continue as businesses experience loss of revenue as productivity has been impacted as well as reductions in customer base and market valve – seriously impacting the C-Suites’ financial goals.

• Risk Management: A data breach exposes the company to regulatory fines and legal action. The board is responsible for identifying and mitigating risks, including the risk of data breaches, to ensure the company’s continued success. Holding your data team accountable for breaches is no longer enough to keep protected. Responsibility for your data sits at the top of the funnel.

• Corporate Governance: Any media attention from legal action and regulatory fines, can hugely impact the company’s reputation and shareholder value. As well as loss of customer trust and confidence equally furthers revenue instability and market value. Responsibility for ethical and legal standards sits at the C-Suite level, including the protection of customer and shareholder data.

Too many senior leaders are still relying on the network security team to safeguard data. They are not inquiring enough to identify any potential risks to the business, which can be considered reckless. Neglecting to safeguard data is equivalent to failing to protect the company, its employees, and shareholder value. Therefore, it is imperative that the C-Suite must understand the significance of data security and the impact it has on their accountability.

The solution: Data protection across its entire journey

Traditionally, when it comes to data management the C-Suite would hire a Chief Risk Manager and a team to manage its data and the responsibility would sit with them and not be classed as a wider business issue. However, CEOs are now personally liable for failing to meet regulations, making data protection a wider business issue that requires a shift in mindset.

A crucial element of data protection sits at keeping data secure across its entire journey, from the source right the way through to its destination. Encrypting the data to keep it protected.

Encrypted security measures can shield the data from unauthorised access, rendering it useless even if a hacker gains access. This means that in the event of a breach, the company will not be held liable for data stolen, fines, reputational damage, or the personal liability of the senior team.

The responsibility of implementing the appropriate security frameworks lies with senior management, who should conduct internal audits to ensure that only authorised individuals have access to the data and that it is unusable to any other unauthorised recipient. Hence, a data-driven approach is crucial for effective security measures and complete protection of the business.

Unlocking the potential of family-friendly employment laws

In today’s rapidly evolving job market, businesses must embrace family-friendly employee benefits and policies to attract and retain exceptional talent. Recognising and accommodating the diverse needs and responsibilities of employees is not only essential for maintaining a healthy work-life balance but also for building thriving workforce.

The good news is that three groundbreaking laws have recently been passed that will enhance protection for employees. The Carer’s Leave Act, The Neonatal Care (Leave and Pay) Act, and The Protection from Redundancy (Pregnancy and Family Leave) Act will significantly change the landscape of employee benefits.

While these laws are set to take effect next year, employers can start to prepare now for the significant impact they will have on their workforce. Embracing these progressive laws can modernise businesses and prompt employers to review and enhance their existing benefits and policies to better support their employees.

The Carer’s Leave Act:

The Carer’s Leave Act, which originated from the Carer’s Leave Bill presented by Wendy Chamberlain MP, received Royal Assent on May 24, 2023, making it law. This act allows employees who care for a spouse, civil partner, child, parent, or other dependents requiring at least three months of care due to illness, injury, disability, or old age to take time off to fulfil their caregiving

responsibilities. The bill also ensures that employees are protected from dismissal or detrimental treatment as a result of taking this leave. Carer’s leave can be taken flexibly in blocks of five days, individual days, or half-days, providing the necessary flexibility for carers to manage their work and care responsibilities. Employees will be required to selfcertify their eligibility for carer’s leave, facilitating a balance between work and caregiving while enhancing retention and well-being.

The Neonatal Care Act:

The Neonatal Care (Leave and Pay) Act: Also receiving Royal Assent on the same day, the Neonatal Care (Leave and Pay) Act establishes a new day-one right for eligible employed parents whose newborns require neonatal care. In addition to existing leave entitlements such as maternity and paternity leave, parents can now take up to 12 weeks of leave to be with their baby during this critical period.

The Protection from Redundancy (Pregnancy and Family Leave) Act:

The Protection from Redundancy (Pregnancy and Family Leave) Act expands the current protection granted to employees on maternity leave to those on adoption/shared parental leave when a redundancy situation arises. This act ensures that employers offer suitable alternative vacancies to employees on maternity leave or adoption/shared parental leave, starting from the point the employee informs the employer of their pregnancy and continuing until 18 months after the birth.

Director

How can businesses prepare for these changes?

It is recommended that employers take proactive measures to familiarise themselves with the new laws. Understanding and adhering to the laws will prevent potential claims from employees regarding the violation of their rights. Communicating the changes to employees is key to ensuring their awareness of their new rights and showcasing the employer’s commitment to employee well-being. Employers should also establish processes and use technology, such as absence management systems, to track these new types of leave and enable effective resource planning to cover periods of absence seamlessly.

The introduction of these groundbreaking family-friendly employment laws will greatly benefit employees facing caregiving and family-related situations. For businesses, this presents an opportunity to go beyond legal requirements and offer enhanced support in these areas. By effectively communicating these changes and promoting existing benefits such as flexible working, parental leave, and protection benefits, employers can demonstrate their commitment to their employees’ well-being.

Adrian Lewis

Activ People HR