The very first edition of the European Finance Summit took place on March 5th, 2020. More than 500 finance professionals gathered at the ECCL to discuss the current and future trends that are redefining the entire industry. After discussing payments in the morning, the second part of the summit focused on "the new financial landscape at the horizon 2030".
As Master of Ceremony, Jean Rognetta (Editor at large, Forbes France & President, PMEfinance-EuropeEntrepreneurs) first introduced the topic and welcomed Gilbert Fridgen (PayPal-FNR PEARL Chair in Digital Financial Services in the SnT, University of Luxembourg) on stage. He focused on "the evolution of financial services in the digital economy". The expert started his presentation by sharing an example of deepfake, explaining that such technologies could also impact the financial services, notably KYC processes, linked with trust issues. Gilbert Fridgen also presented several blockchain use cases, from digital identity and cross organizational workflows to payment services. "At the SnT, we developed a prototype with a German car manufacturer, showing how truck drivers could exchange money," he added, before explaining the difference between free cryptocurrencies, private competitors and central bank digital currencies (CBDCs). Who will make the race? According to him, it will either be private blockchain or CBDCs. The expert also highlighted that regulations – GDPR, KYC, AML, etc. – will be a challenge for all these three solutions. "The necessary tech is there; we just need to do this. We will see it soon in the next years in several areas," concluded Gilbert Fridgen.
In parallel, at 2pm, an open air conference on the contribution of ESG strategies to portfolio's active return was given by Philippe Grégoire (Head of Financial R&D at Amindis and Professor at Louvain School of Management).
The opportunities brought to banks by digital
Fabien Vrignon (Chief Executive Officer, Keytrade Bank Luxembourg) and Jonathan Prince (Co-founder, Finologee) then had a conversation on the topic of "the impact of digitization on Banks". As explained by Jonathan Prince, digital does not only mean new products and services but also represents a huge opportunity for traditional banks. Fabien Vrignon agreed and added: "the goal is to acquire new customers. Therefore, onboarding is key and will allow the development of new business". He also added that smaller banks need to be pioneers and innovate: "we do not have an office. Everything is digital and our goal is to offer an enhanced experience. Digital makes banking available to more people and the main idea behind it is to make it universal as possible". The two experts also briefly compared the situation in Luxembourg and Switzerland, as the current CEO of Keytrade Bank used to work there. Jonathan Prince and Fabien Vrignon then discussed the ways to simplify the processes, as "customers do not have a lot of time". Banks therefore need to ask only the mandatory questions and smoothen the process. "Moreover, we also need to manage the life of the customer. UX helps as it tries to erase all the pain points," highlighted the experts. As a conclusion, the CEO of Keytrade Bank shared his key takeaways: "be flexible and be ready. Also, focus on really satisfying the customers and make sure you have a great relationship with them".
The future of wealth management
Frederic Kemp (Managing Director, Avaloq Luxembourg) lead a round table discussion, with the participation of Steeve Gresse (Head of Innovation & Digital Client Experience, Banque de Luxembourg), Dr Peter Mathis (Partner, board member and Chief Investment Officer, BCB & Partners S.A) and Mario Alves (Head of Sales & Partner Management, Aixigo). The moderator started: "the industry is facing several challenges, with a decreasing profitability, new entrants and new clients' requirements". Peter Mathis added that we are currently in a phase of democratization of wealth, with a new generation and a world that is much more transparent. He also explained that "technology won't leave the industry unchanged. For instance, Amazon and other tech giants are prepared to move in". Mario Alves highlighted the need to focus more on customers and compared the transformation of the WM industry to what happened in the music industry: "what will be the service I offer in the years to come? Customers will expect us to serve them better!" he added. The expert also advocated more personalization and a transformation to a fee-oriented business model, which leads to service rather than selling. Steve Greese discussed regulation pressure and the fact that relationship managers are struggling with administrative tasks. He concluded: "the future will be fully digital and personalization will be the key. By definition, our DNA is the trusted human relationship with have with our customers".
Moving toward climate finance
"Greta, the Bad and the Ugly" was the name of the presentation given by Alex Houtart (Founder, Impact Squares & lecturer in Sustainable and Innovative Finance). "In just more than a generation, we jumped from kids with no fear of the future to today's youth, full of anxiety and fear," started the expert. Alex Houtart then shared his personal journey, from going bankrupt with Fortis in 2008 to asking himself the right question: do I do enough? He then broke down the several steps of the development of the sustainable finance strategy for BNP Paribas Fortis. "We started with CSR to recover a certain sense of purpose for employees," he explained and continued: "we then moved to SRI and ESG, bringing responsibility into the core business. We were one of the first banks to do it, but also faced a lot of resistance internally. People were actually afraid to do something new. And finally, we started doing impact investing, which aims at creating a positive outcome. You can actually follow your investment to be sure that the money has been used to finance climate projects".
"What does music have to do with sustainable finance?"
This question was answered by Julia Zhou (Communications Director, Kairos Europe), who also shared her journey towards sustainable finance. It started in California, where wildfires were decimating entire cities. "It changed my perspective about climate change. Currently, over 50% of Americans believe that climate change doesn't affect them personally," she explained. She continued: "piano music is actually a way to connect to people. People also need to connect to something to care about it. In the field of sustainable finance, what's even more interesting is the fact that it is good for the planet, but also that is will lead to greater financial return in the future". According to her, as we all live on the same planet, we need to something together: "it's our mutual responsibility. We can use tech to solve the problems of tomorrow. Big companies are following this trend and offer different incentives, such as Blackrock, Microsoft, etc.".
Moving towards sustainable finance
A panel discussion, around the outcome of a business model driven by sustainable finance, brought together Pascal Bouvier (Fintech Venture Capital Investor) – who acted as moderator –, Sachin Vankalas (General Manager, LuxFLAG), Bernard Nicolay (Adjunct Professor, Solvay Brussels School of Economics and Management (ULB)), Diego Rojas (Co-Founder and CTO, mattrvest) and Olivier Goemans (Head of Investment Services and Innovation, BIL). Moderator Pascal Bouvier first asked the participants to share their own definition of "sustainability". "Common wisdom, but we need to work eve more on awareness", according to Olivier Goermans, "a tool to empower consumers and drive possible change in the world", according to Diego Rojas. Bernard Nicolay shared the definition of the UN, dating back from 1987: sustainable development is development that meets the needs of the present without compromising the future. The experts then discussed the links between ethics, sustainability and economic growth. As explained by Sachin Vankalas, "it's not always about economic growth. How do you treat your new customers? What about diversity? Do you have an independent board? The spirit goes further than just a communication exercise. Moreover, we also need to measure non-financial performance". As highlighted by the CEO of Luxflag, governments cannot achieve sustainability alone and need to work with private companies. And Bernard Nicolay concluded: "sustainable finance is here to stay. I'm an advocate of partnerships between different actors. Also, we need to work on this topic at an educational level".
An ageing population and its impact on insurance products
A fireside chat discussion, called "Impact related to people ageing", featured Florian Graillot (Co-founder and Partner, Astorya.vc) and Maria Cristina Boscolo Berto (Director, Regional Head of Wealth Structuring, Lombard International Assurance). The latter first explained that we are currently creating new products composed of traditional features and more sophisticated components, notably taking into consideration the longevity aspect. "Nowadays, the silver economy is driving the investment market and is composed of three pillars: wealth and care, insurance, and consumer goods. People are investing and consuming at the same time," added the Lombard expert. She also discussed multigenerational families and their new demands, explaining that insurance companies need to identify these trends and map them. Florian Graillot highlighted the fact that the ageing population opens new areas of investment: "insurers are looking beyond the silver economy. They develop services to create more engaging relationships with the customers. They need to be able to spot the right moment to engage with ageing customers and leverage data to better serve their needs. In other words: at the right time, with the right product, using the right channel".
Talents vs. Rebels
The last conference of the day was given by Matteo Rizzi (Unconventional entrepreneur, book author, venture partner and co-founder, FinTechStage). He discussed a decade of Fintech, and the transformational journey of seeking talents for the jobs of the future. "Today, no company says 'I don't innovate'. Leaders never say: 'we hate innovation'. They all claim to do it, but most of them actually talk about incremental innovation," he first stated. The Fintech expert then shared several examples of "rebels" who tried to warn their companies about change – Steven Sasson, Kodak – and who could foresee the future – Reed Hastings, Netflix. "Rebels do not think the same way. They should be considered a resource. They are motivated by passion and freedom. But why should companies care? Because they might miss an opportunity," added Matteo Rizzi, before sharing the different characteristics of rebels: "they are all not worth the corporate fight. They are a resource like any other employee. Companies need a sandbox, not a zoo. Some rebels actually DO wear ties. There is no average age for a rebel. And finally, don't be afraid to cluster them: build links and encourage collaboration to get the best from both worlds".
The event ended with the ceremony of the Luxembourg Finance Awards and with the traditional networking cocktail, which allowed the participants to further discuss the topics of payments, sustainable finance, and much more.
Photos: Dominique Gaul
Publié le 09 mars 2020