29
May

There should be more positive discrimination in Finance

Escrito el 29 mayo 2009 por Antonio Rivela Rodríguez en Uncategorized

This first one of a series of blogs is the result of conversations I have had with many participants in the financial markets. 

We have held European sales/trading positions in Financial Institutions and our goal is to come up with recommendations in order to improve the efficiency of the markets and to make sure that shareholders are aligned with the resulting value created.

There has always been a concern on the huge conflicts of interest originated by mixing up Friendship and Professional relationships when doing business with the public sector. I would say mostly in Latin countries (“Hot blooded”), where friendship usually collides with job matters.

That concern does not seem to bother private institutions. Funnily enough shareholders are negatively influenced by it. If an asset manager buys a structured product from her friend at Goldman Sachs without having beauty contested the trade beforehand her client (friend) will suffer for sure…. And utterly her financial institution.

As a matter of fact Investment Banks do hire sales people on the basis of having many friends on the clients side: Taking clients to expensive dinners (The whole purpose of the existence of places like “The Fat Duck” in UK or “el Bulli” in Spain), or to a Formula 1 event in Monaco, giving expensive gifts in exchange for transactions or an unlimitedly long list that every seasoned sales person knows….

In certain regions like Southern Europe (i.e. Portugal, Spain, Italy, Greece, etc. ) or LATAM clients (like Fund Assets Managers or Saving Banks) tend to reward his friends on the sale side with juicy deals. If you are not a close buddy of them you stand no chance to being awarded a profitable transaction. This issue, while tremendously unfair is well known in the market place and accepted…

One of the reasons behind it is that clients are not well paid, and definitely not well equipped in terms of financial knowledge. As a result they only trust their friend on the banking side.

Do we have a choice?

Well… That´s the whole purpose of this blog. I do believe that women in general would do it much better.

While I have always opposed positive discrimination in any way, shape or form, I have to say that in this case I am a big fan of promoting women over men for a reason:

Women are much better on the buy side. They act with more professionalism when facing a purchase power job. They do not become as corrupt as men. They tend to look only at the quality and price of the product they are seeking to buy. They tend to beaty contest everything because they will compare the product to any similar product available in the market.

While, in the conversations I held with my colleagues this was an obvious phenomena I have tried to rationalize it:

1.   I believe women do not like to have dinners out of job schedule for he sake of fun, just because they prefer to divide their personal/professional hemispheres. I believe it’s a wise choice by the way.

2.   Even if they had to they would not enjoy it. For some men using the company´s  Amex to be able to pay a visit to “El Bulli” is very standard.

3.   As a consequence of 1.,and 2. females don’t become friends of the banker who is just rendering them a professional service.

4.   As a result of 3. ,they don’t feel pressure in order to keep that “friendship” and they don’t reward with trades.

5.   So they just value the fair price and the transaction characteristics more than the one trying to sell them the trade

6.   And finnaly and of utterly importance they compare with every single product available for purchase.

 

So, lets cut the long story short. Lets promote women for jobs in order to diminish this “mafia” oriented approach to doing business that we face in Southern Europe / LATAM  and I am sure in many other regions worldwide.

 

 

 

 

 

 

 

Comentarios

Dilin 29 mayo 2009 - 17:37

Hi Antonio, I agree with your blog’s conclusion. Do you think for women to be in the sell side of structured products it is important to be able to drink (hold their liquor well)?

rabaty 31 agosto 2013 - 17:11

You should check this out…

I saw this really good post today….

styczen 5 enero 2014 - 14:14

Great website…

Here are some of the sites we recommend for our visitors…

Dejar un Comentario

*

Utilizamos cookies propias y de terceros para mejorar nuestros servicios y mostrarle contenido relacionado con sus preferencias mediante el análisis de sus hábitos de navegación. Si continua navegando, consideramos que acepta su uso. Puede cambiar la configuración u obtener más información aquí. Aceptar