Giving Davos a miss

A member of the Lens spoke with Keith Skeoch, the chief executive of Standard Life Aberdeen. It was during the sixth week of the UK’s lockdown and Skeoch has mostly been working from his home in central Edinburgh.

The conversation (to be published in full at a later date) covered the Covid-19 situation. Here are a few choice details. 

“Over the last couple of years, we have been moving towards more agile working and the crisis has accelerated this strategy. I don’t think we will return to everyone being in the office five days a week,” the CEO said.

Skeoch spoke about the decision to give the World Economic Forum in Davos a miss next year. He said the £3 million that would have been spent attending the event – where SLA has operated a popular café bar which dispensed malt whisky to delegates – will instead be used to support the crisis. Some of the money saved will also be used to fund a scheme whereby SLA matches the charitable donations of its staff.

“Davos has done a lot of good and has been a very good talking shop over the years, but this is a time when we want to bind with our local communities rather be part of the global elite,” he says.

An economist by training, he also praised central bank responses to the crisis.  

“The authorities seem to have learned some of the lessons of the global financial crisis and there is a recognition that, if you look at the history of recessions, major recessions that have big long-term consequences have usually been accompanied by a financial crisis.”

And the most likely economic recovery pattern, he expects, is “a U-shape with an elongated bottom, though I would not be surprised if we get quite a strong snapback in 2021”.

But he warned that a challenge for asset managers will be dealing with and delivering returns with what looks like a very significant increase in asset price volatility However, volatility coupled with low interest rates could be a good development for active managers, he added.

*The interview will be published in the June edition of Funds Europe magazine.