Corporate governance, the next cornerstone of investment
Keith Skeoch is above all an economist, since he graduated with a master’s degree in economics and started his career with a brief spell at the Government Economic Service. He then began his career in the financial sector as international economist in 1980 at James Capel, a brokerage firm which was taken over in 1986 by HSBC: "In the 1990s, investment banks were already starting to reduce more and more their dependency on research to concentrate on business that generated short-term profitability", emphasises Keith Skeoch, who does not mince his words when it comes to the banking sector. The first stage of his professional career ended in 1999, when he joined Standard Life Investments as Chief Investment Officer: "When I announced that I was joining Standard Life Investments, my family and friends said I was mad: how could I move to Edinburg in Scotland? But above all, how could I go to work for a fund belonging to an insurance company, which implied that it was doomed to failure?", recalls the CEO. Twelve years later, he is still with same company, and has been promoted: since 2004, he has been CEO of Standard Life Investments and has also been on the board of Standard Life PLC since 2006. "Over the last decade, we have noted a growing demand among investors for specialised or regional mandates, or even by asset classes, to the detriment of balanced mandates, notes this 55 year old asset management professional. In this new environment, it is important to identify your competitors."
Beyond the new competitive landscape, the philosophy of asset management has also changed: "Return on investment is no longer preponderant, having given way to the quality of corporate governance and client service", explains Keith Skeoch. Moreover, the CEO welcomes the launch in July 2010 of the Stewardship Code in the UK. This code of good conduct encourages institutional investors as well as financial service providers to publish their voting and engagement policies with a view to improving corporate governance. Moreover, this code should "define the future form of investment", concludes Keith Skeoch.