Data as a nucleus

Sabrina Bailey, Global Head of Investment & Wealth Solutions at London Stock Exchange Group, talks to Shanny Basar about data being a nucleus for wealth and asset managers, understanding customers’ DNA and calling out unconscious bias.

Sabrina Bailey grew up in a small town in Oregon and had never heard of a stock or a bond until she went to college. However, she has since worked in finance for more than 20 years and in June 2022 became Global Head of Investment & Wealth Solutions at London Stock Exchange Group.

Bailey said: “Just noticing that gap, based on where you live and access to education, gave me a passion to pursue an industry where I could start to make a difference.”

In her current role Bailey is based in the US and responsible for developing and delivering upon the strategic vision and direction for LSEG’s global wealth business. She had joined Refinitiv in May 2021 as Global Head of Wealth Solutions, Data & Analytics Division and that expertise in data and technology is critical.

“Data is our nucleus in terms of what we serve to wealth and asset managers, around which everything evolves, and the critical insights that come from that data are atoms,” added Bailey.

She continued the analogy describing data components being put in different cells, which are the wrapper that delivers information either through API cells directly to customers; widgets or visualisation cells; or platform cells which provide the whole solution in one place.

Bailey said: “Each cell in your body runs a different function so we have the ability to understand which cell fits best into our customers’ overall DNA to create the business function and growth they are looking for.”

The customers span a broad range as Refinitiv has 40,000 clients around the globe and 400,000 end-users across 190 countries ranging from retail investors to the largest institutions, according to Bailey. She compared their different needs to how a chef uses an onion to cook. Retail investors typically just want the outer shell to add some flavour while portfolio managers peel the onion all the way back, chop it up, and then add it so it becomes part of the essence of what they are creating.

“The industry is focusing on human-centred design, which we are looking at as well, to serve up a meal in a way people can digest rather than providing ingredients and expecting everybody to be a chef,” added Bailey.

One common feature is that every customer wants to be able to conveniently access the data they need to make decisions. She said. “We combine a unique open platform approach with best in class data to connect people to the right opportunities and drive our customers’ performance, innovation and growth.”

Another common feature is increased use of the cloud but Bailey said that there will always be data that is off the cloud for specific business reasons. She said: “Flexibility and adaptability will drive growth and we make sure we can deliver those cells as firms need to meet their solution, whether partially or fully in the cloud.”

Bailey has always been interested in making sure individuals at all levels of the wealth spectrum have accurate data from which to make decisions.

“In my role as CEO of a fintech at Northern Trust, I ran into data providers where quality was not a component of what they offered,” she added. “Back then I undervalued the importance of really high-quality data to make sure we are driving those secure financial outcomes.”

ESG

The demand for high quality data related to environmental, social and governance (ESG) investing has grown. ESG is a core focus for customers according to Bailey and she argued that it is one of LSEG’s key areas of strength as the group has been in the ESG space since the early 2000s.

“I’ve been focused on ESG since 2000 and this is the first time in my career that a majority of customers are saying ESG is an area that we need to be aware of and integrate into what we do,” she said. “We have got breadth and depth of data and our customers want to really understand the implications for their portfolios.”

LSEG is looking at how to provide insights from that ESG data such as how a score has moved, what direction a company is moving in and importantly, how data can be aligned to match investor preferences. She expects the ESG space to continue to evolve in the next five to 10 years and said common accounting standards will be critical to drive consistency of data.

In addition to ESG, the growth strategy involves continuing to expand data, including providing local content for areas that are growing rapidly such as Asia Pacific. The business is shifting focus to building critical insights from data in conjunction with customers, understanding their pain points and the business intelligence they need, and the format they need it delivered in so they can ingest and use insights in their in-house customised solution.

However, not every firm is going to want to build their own platforms, so Refinitiv will invest in serving up data in a meaningful way so customers can make decisions quickly based on information at their fingertips.

Bailey said: “We will invest in areas such as robotics, artificial intelligence (AI), machine learning and natural language processing to bring our analytics to life for our customers.”

The finance industry is focused on convenience and trying to figure out how to bring that to their customers, according to Bailey. She added: “The industry is really strong from a data and in-depth analytics perspective and having the ability to take all of that and serve up critical insights in a convenient place for clients to make decisions will define who is really successful in the future and who is the laggard.”

Self-directed investing

Bailey said that when she entered financial services she was pleasantly surprised by the industry’s impact on retail investors. She added: “It has been really great watching the industry transform from an institutional focus to democratising what we have.”

She described herself as being really excited that LSEG is one of the first movers in the self-directed space and working with customers on engaging with their end clients. LSEG provides a solution for customers to directly provide research to the end investor and build that relationship digitally.

“There is a focus on self-directed investing and I see wealth and asset management firms both having more fluid solutions in the next year or two,” she added. “We have one customer in Singapore, for example, where 85% of their ultra high-net worth clients started self-trading during the pandemic and they don’t believe that is going to revert back to normal.”

Her hypothesis is that there will be a slight pullback in terms of self-directed trading as individuals experience market volatility but that will correlate with increasing wealth management assets as investors who have made some money look for advice. However, she also warned about going too far in terms of democratisation.

“I may want to understand how the engine of a car works so that if I break down it can get fixed, but I should not be building an engine,” said Bailey. “As the dialogue continues people assume that every end investor wants to be an expert or an engineer that can design engines, and that’s not the case.”

Career

Before joining Refinitiv, Bailey was Chief Executive Officer of Emotomy, Northern Trust Asset Management’s digital investment advice offering. In her prior role at Northern Trust Bailey was the Global Head of Retirement Solutions.

“Prior to Northern Trust I worked on the investment consulting side, servicing asset managers and large pension programmes, foundations and endowments so this broad knowledge really helps in my new role,” she added.

Northern Trust had distinct asset management and wealth management arms but they were very similar in terms of data needs and requirements for business intelligence. Bailey said: “I have that customer lens to bring to the table because I’ve worked on the other side.”

Bailey gave four reasons for changing roles and organisations. The first is to increase knowledge as she is a big believer in continual learning and the second is to broaden the network of people she can serve. The third is that it aligns with her purpose of enhancing financial security for individuals, communities and economies and the fourth is her passion for financial services.

Her advice to women who want to work in financial services is to focus on three areas. First and foremost, be true to who you are. Second is to be passionate about what you do. The third is to be purposeful about where you spend your time and recognise there is no such thing as work-life balance.

“You will have to choose where to spend your time based on your priorities and really focus on being ‘where your feet are’ and fully present,” said Bailey. “That will drive balance in your life and not a fictitious notion of some type of pure balance.”

She puts her success down to understanding that her role is to serve other people.

“I’m a big believer that if we end every conversation asking how we can help, that will drive success because serving others with integrity builds strong relationships,” added Bailey. “I’ve made colleagues who are friends and I have customers who I still talk to who I worked with decades ago.”

Another factor is having the grit to be willing to take on the impossible as Bailey was willing to raise her hand for the roles that nobody else wanted. She said: “I don’t like to be told something can’t be done as it motivates me even further to prove everybody wrong.”

Diversity

Bailey describes the biggest surprise she had entering financial services was the lack of diversity – which she still finds today.

“In the last two weeks I’ve been in a number of external meetings where I am the only person who looks like me in the room and that has been throughout my career,” she said. “I have seen some progress and the industry is recognizing we have work to do.”

Bailey believes working from home will help drive diversity in terms of flexibility as women are relied on as caretakers more often than men for both children and parents. She said: “We’re in the life cycle of baby boomers where a hybrid model gives them the flexibility to be there when needed but also the opportunity to truly connect and build relationships in the workforce.”

In order to improve diversity Bailey would like the industry to continue to recognise that diversity remains an issue because although there are a lot of affiliation groups and employee groups that does not solve the problem. She said organisations have to be thoughtful about how they attain diversity, especially in the leadership ranks, which requires considering different personality types or candidate types in terms of those next roles.

She also wants senior leadership to be more willing to call out unconscious bias.

“Within the last 12 months I’ve been told by a financial advisor that they couldn’t talk to me alone because I don’t understand enough about investments and they needed my husband to be present,” said Bailey. “I’ve been told I should be quieter and I am now at the point in my career where I’ve learned that I need to appropriately stand up.”

In addition, Bailey wants people to lean in and mentor others who are different from themselves.

“I have been purposeful about building a network of new and mid-career employees who are completely different from me to coach and guide them on how they stand out relative to peers,” she added. “If every leader did that, we’d get much further from a diversity perspective.”

©Markets Media Europe 2022

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