Lionel Aeschlimann, CEO of Mirabaud Asset Management, shares his perspectives on the Swiss financial landscape, Mirabaud’s strategies and the future of finance.
What are your thoughts on the current state of the Swiss financial market?
Despite recent turbulence, we remain optimistic about the strength of the Swiss financial industry, as the framework underpinning the market is still sound. Switzerland has long been renowned for economic and political stability, while its competitive landscape appeals to companies of all sizes and financial sectors. While a small market, Switzerland is open to the world’s major economies. As such, Switzerland’s financial industry and its broader economy can better withstand the underperformance of any individual region. The Swiss National Bank’s credibility and the franc’s strength are also integral elements of Swiss stability.
What are the biggest challenges facing the Swiss financial industry today?
In many ways, the Swiss financial industry’s challenges are identical to other global centres – such as the impact of elevated rates and slowing growth, geopolitical threats and the need for continued adaption to technological innovation like AI. Similarly, another challenge shared by many markets surrounds regulation. When we encounter periods of stress, such as this year’s banking issues in the US and Switzerland, reactionary regulatory action often follows – irrespective of whether more stringent controls are warranted. We need to be careful regulation does not stifle innovation and entrepreneurial freedom – qualities that have served Switzerland well for centuries.
Where do you see the most significant opportunities for growth in the Swiss financial industry?
We see significant opportunity for the Swiss financial industry due to the country’s many broad tailwinds – such as the pro-business environment, the open and diversified economy, the high standards of education and the willingness to embrace innovation. International clients are, and will continue to be, drawn to these inherent Swiss qualities. While the wealth management segment is entrenched in Switzerland, asset management has been somewhat in its shadow. But we see a considerable asset management growth opportunity ahead, as demand for robust investment propositions – particularly those with sustainability embedded in the process – will only accelerate in the coming years.
How do you see the future of the Swiss economy shaping up?
Switzerland is a very open economy in exports, with more than half coming from chemicals and pharmaceuticals. But it is also quite a diversified economy, featuring varied major export industries like machinery and watches. As Switzerland’s leading trading partner is the eurozone, the country will not be immune to today’s European slowdown. However, we expect the Swiss economy to display more excellent resiliency, as about 74% of GDP is generated by the services sector – which has recently experienced a solid rebound. Switzerland’s swifter bounce back from Covid-19 than many peers was primarily thanks to diverse drivers of the economy.
How is Mirabaud adapting its strategies to meet the current financial climate?
Over recent years, the financial landscape has undergone notable changes, especially with interest rates in Switzerland remaining at -0.75% from 2015 until March 2022. Mirabaud recognises, as do many institutions, the strong influence of central bank actions. As the financial environment shifts, there is a growing belief that strategies rooted deeply in fundamental factors, rather than mere technicals, will hold the key to navigating these changes effectively.
Can you discuss the role of private equity and real estate in Mirabaud’s long-term strategy?
Mirabaud, in line with evolving global financial trends, views private assets as an increasingly essential part of a diversified investment portfolio. The noticeable trend of fewer companies opting for public listings and the protracted timeframes for IPOs highlight the significance of this asset class. While venturing into this space, the overarching emphasis remains on leveraging experienced management and comprehensive industry insights.
How does Mirabaud view the role and importance of ESG investing?
For Mirabaud, integrating ESG considerations into investment processes has been a journey of conviction and commitment. The financial world is coming to terms with the fact that traditional financial metrics need to harmoniously coexist with non-financial considerations. Beyond the standard positive and negative screenings, there’s a substantial industry shift towards active engagement, aiming to foster sustainable change. Yet, challenges persist, especially around acquiring reliable sustainability data, a concern that Mirabaud shares with its peers.
How do you envision the impact of FinTech on Mirabaud’s operations in the coming years?
The rapidly evolving world of FinTech presents both opportunities and challenges for traditional financial institutions. Mirabaud took early steps in this direction, as exemplified by its transition to cloud-based solutions. Still, in this whirlwind of technological progress, the firm believes that the essence of financial services lies in human interactions. The future, as Mirabaud sees it, will be about marrying the capabilities of cutting-edge technology with the trust and understanding that personal relationships bring.
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