From the 2020 Milken Conference.
It’s hard to believe that it was this same calendar year that I was looking forward to traveling to the Milken Conference and joining Credit Suisse’s Thomas Gottstein, Goldman Sachs’ David Solomon and Wellington Management’s Jean Hynes on stage for the plenary session. I was honored to join them nonetheless last week as we shared ideas with Mike Milken on how to “meet the moment” and begin rebuilding a post-pandemic world.
My remote seat at the 2020 conference was at the BNY Mellon’s Cyber, Technology & Operations Center (CTOC). It’s a place that brings to life the role our bank plays at the center of our global capital markets—especially when responding to an event with the economic fall-out of the global economic crisis and 9-11 combined.
Our focus remains on our employees and doing our part to combat an ever-serious public health emergency. But as we rebuild a post-pandemic world, this high-tech nerve center reminds us that never before in our history do we need the scale and reach that only a global financial institution can provide. The investment needed to rebuild is considerable, which is why the markets must provide unprecedented access both to capital as well as data.
A resilient banking system has never been more important. The trends and issues that were already prominent in the financial world—digitization, workplace diversity, and ESG investing, for instance—have accelerated. How we respond in the period ahead will say a lot about us and our future.
Digital Everything
BNY Mellon is fortunate to have a unique perspective on how the infrastructure of the capital markets is evolving, and I can predict with some degree of certainty that because of the pandemic, which showed us just how interconnected the world has become, we could see a decade of financial innovation compressed into half that time. Our global financial ecosystem continues to grow at breakneck speed in order to support digital currencies, tokenized financial assets and intellectual property.
Banks are becoming more open to innovative fintechs and pure-play technology companies because robust, expanding ecosystems are highly correlated to the digitization of a business. I can’t help but think of the timing of our inaugural Fintech conference late last year. We hosted start-ups, innovators, and investors who are at the leading edge of financial technology and increasingly a central part of our bank’s open ecosystem mindset. We asked those in attendance to raise their hands if they thought blockchain wasn’t going to change the world. Not a hand went up—and that was well before the pandemic. Since then, the demand for digitization in the global markets has grown more quickly than anyone at that conference would have predicted.
ESG: A New Way Forward
Digitization of a bank’s core can’t occur without a vibrant, open ecosystem of developers, partners and, yes, in a world rebuilt by trust, sometimes even competitors. BNY Mellon’s open platform model, characterized by a “strategic entrepreneurship” approach, is a way to hedge even the most disruptive of markets. But it’s also the way to be at the center of them.
Our new ESG app is a great example of how we’re leveraging our global network and vast resources as the “bank of banks.” The app provides clear, actionable feedback to the ESG community by crowdsourcing to determine what drives the vast majority of sustainable investors. With our ESG app, the complex, often opaque world of sustainable investing can become a clear, distinct vehicle for safeguarding and growing the life savings of millions of people.
Markets must also be more inclusive. More individuals and institutions alike need access to expanding markets. They can when they’re part of a digitized ecosystem and the tools that come with it.
Empathy Matters More Than Ever
It’s been my experience that people (especially on Wall Street) can handle a certain degree of stress, sometimes for a long time. But we don’t do as well with uncertainty. This pandemic combines both. As the CEO of a Global Systemically Important Bank, it’s been amazing to be a part of a large workforce that went virtual overnight. Since then my colleagues have persevered through challenging circumstances. They continue to deliver for clients and partners who rely deeply on us.
I know colleagues with families who are homeschooling and also those who have found themselves suddenly alone and isolated. Like many, I’m concerned about a mental health epidemic that might follow hot on the heels of the COVID public health pandemic.
Stress and uncertainty—and, more broadly, mental health and well-being—were already becoming C-suite and boardroom topics before the pandemic. Companies might soon find themselves on the frontlines of helping employees confront deep mental health challenges. Empathy, long a trait of top leaders, will be even more important in the period ahead.
New Ideas from the Next Generation
Technological advances can’t happen without putting people first. Rebuilding a post-pandemic world is contingent on having an engaged employee base that really wants to perform. Indeed, what all high-performing companies have in common is a diverse and collaborative workforce. To that end, I’ve announced our intention to transform the bank over the next three years in order to reflect the communities we serve. It’s not going to stop there, but we’ve placed a stake in the ground and are committed to change.
We also want to make sure the time decay brought about by the pandemic hasn’t stifled the development our current talent. Some of the most innovative people at America’s oldest bank—the ones I’m proud to lead—are its youngest employees. In their desire to work with a sense of purpose, they’ve found the ideal place because they’re behind the well-being of the financial system itself.
Yet the usual moments to shine for this next generation of leaders—impromptu chats with mentors, brainstorming with bosses, networking with colleagues—aren’t easily available in a lockdown. It’s imperative that we don’t allow for a “lost year” of career development among our country’s brightest stars and future leaders. In the months to come, I’ll be heavily focused on the advice and perspective I get from our most promising employees.
Embrace History’s Great Accelerator
We would do well to acknowledge that this pandemic—for better or for worse—is likely to be a great accelerator of history’s trends. Historians have shown that when pandemics end, one of two worlds tends to emerge. In some cases, devastated societies dissolve into smaller, more disconnected and distrustful parts. Then there’s the better world before us: one that’s, yes, more complex, but more connected and prepared to face the challenges of rebuilding together.
We are surrounded by uncertainty and live in a moment when it’s easy to feel skeptical—even cynical—about our future. But by placing our trust in the next generation and working to rebuild trust in our institutions and in each other, we can feel more hopeful about the world to come.
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Mark Norfolk, Ph.D., CFA
CBDO of NRC FTO