This week, our Founding Partner Robin Gordon-Farleigh spoke about transforming the investor narrative into the currency of reputation to an audience of international investors at a conference focused on investment in South Asia. An edited copy of this speech is below.
Good morning, and thank you for that introduction.
Let me start by saying - it is both an honour and pleasure to be with all of you this morning, as part of this event focusing on the strength of the investment opportunities that exist in South Asia.
I want to talk to you about the currency of reputation and the importance of transforming the investment narrative into real reputational equity.
I am a passionate believer in the power of reputation – in what it brings to you, how it can add value to you and the organisation and how you can leverage this into a competitive advantage.
In my previous role working in the UK Prime Minister’s Office, my ultimate goal was to deliver day in, day out the strategic narrative of Prime Minister David Cameron and his Government. In doing so, my clear objective was about enhancing the Government's reputation at home and abroad building out our influence, creating trust with our citizens, potential investors into the UK, and presenting Global Britain to the world.
I believe reputation is one of and should be your strongest asset and can make a key contribution to your market value. Adversely, a poor reputation can be costly, negatively impacting your bottom line or access to future investments.
South Asia – Overview
But why are we here today – we are here to talk about the opportunity before us of South Asia.
In terms of setting out the context, let us start by taking a helicopter view of the South Asia economy.
Today, South Asia accounts for one-fifth of the world’s population and, thanks to India’s increasing performance, contributes to over 15 percent of global growth.
Looking ahead, South Asia is poised to play a key role in the global economy, building on the steady economic progress and reforms over the last few decades.
Despite the recent global economic slowdown, India remains among the fastest-growing large economies, and South Asia’s contribution to global growth is set to increase, while those of more mature economies around the world, decelerate.
With a population that has a median age under 27, South Asia is the youngest region in Asia. Based on demographic trends, more than 150 million people in the region are expected to enter the labor market by 2030.
A large and young workforce can be South Asia’s strength if it supported by a high-quality and job-rich growth strategy that leverages all sectors of the economy in a balanced way and makes greater trade and foreign direct investment liberalization.
An opportunity, ripe for investment
It is clear, South Asia provides a real opportunity for investors, and is ripe for investment.
Certainly, with more ambitious liberalization of trade and foreign direct investment, stepped-up efforts to improve infrastructure, and the successful harnessing of South Asia’s workforce, the region could account for about one-third of global growth by 2040.
Global Race
Of course a growing South Asia and world economy benefits us all, but we should be in no doubt that a global race of nations, regions, cities, and companies is underway today.
This is a race for the wealth and jobs of the future. It is a race for trade, investment, tourism, and talent.
Competition is high, and the economic prizes on offer, can be great. The winners will be those who hold and leverage a strong and meaningful reputation that rings true.
The currency of reputation
So with this in mind, let us now focus on the currency of reputation which should be a key element of the investment narrative.
I want to highlight a quote by Warren Buffett which I think in this context helps to set this out. Warren Buffett said that:
“We can afford to lose money – even a lot of money. But we can’t afford to lose reputation – even a shred of reputation”.
So reputation is important, clearly, and I will explain why.
In the global race I mentioned, the currency of reputation can be of real value, it can make a substantial difference to investors in actually opening up further opportunities and in the context of the investment, it can both build its value and competitive edge.
For companies, reputation really matters. It impacts and drives human decisions and behaviors every single day and therefore a strong and positive reputation with your stakeholders including your consumers is priceless.
Reputational equity – the investor
Let us now, look through the lens of the investor, and the importance of building your narrative and reputational equity.
As an investor, reputation is built on what you do, rather than simply what you say. For example, the types of investment you make, what you invest in, the way in which you operate, and how you build and realise the value of the investment.
I believe that the best reputations that are sustained over the long term are those guided by a strong purpose, standing for something greater than what you do, connecting and creating more meaningful trust with your stakeholders and audiences.
A good example of this is the global investment house Blackrock. They use their significant reputational stock to exert influence through their investment strategy to make a clear statement of who they are, what they stand for and articulate the principles of how they do business. The annual published letter by Blackrock’s CEO, Larry Fink, has become the hotly anticipated and revered moment in the business year that sets out their stall and rallies their stakeholders around them through their direction setting statements.
It is why reputation management should be a key priority for both investors and companies to ensure they develop a well thought through plan containing the right steps and focused actions to ensure their reputation is maintained, enhanced and protected.
A strong and positive reputation is highly valued, it provides long term business advantages, contributes to your competitive edge, and leads to sustained opportunities.
Let me just point out just some of the wider benefits it would lead to:
An enhanced reputation can help you to recruit and retain the best talent
Reputation can increase your value that is perceived by your stakeholders
It can help to generate more positive media coverage
It creates a greater power of influence over those around you, and with those you are seeking to do business with
It can lead to securing and developing strong and high-value partnerships – especially important in terms of securing key investment opportunities
It can contribute to increased revenue generation
And finally, in terms of your end consumer, it leads to building and retaining customer loyalty.
So, reputation matters if you are an investor.
Reputational equity – the investment
Let us now focus on the investment itself and how we can realise the value of the currency of reputation that we can create from this.
In both securing the investment and in taking it up, your investment narrative is important. There are clear opportunities to be seized.
By integrating your investment strategy and its key component elements into a streamlined narrative that presents a compelling and powerful story to your stakeholders within your ecosystem and beyond that to the wider world in which you operate in.
This narrative should present and articulate:
Who you are,
What you stand for,
How you operate and do business,
And the value and impact you bring.
With this in place – it can be leveraged to work hard, drive value to you and the organisation and add to your competitive advantage in further potential investment opportunities.
For this reason, it is why I think it is really important to not miss any opportunity that helps to make your reputational stock grow stronger and lead to reaching your full potential.
In summary
So in coming to a close, I just wanted to leave you with this central principle in developing your currency of reputation and deriving the value from it.
If you want to establish credibility, trust and influence people, then
what you say,
how you say it,
when you say it,
to whom you say it,
and whether you say it in the proper context are all critical components - it is why getting your strategic investment roadmap and narrative right, is so vitally important.
Conclusion
Let me finish this morning with this.
The map of global influence is changing before our eyes. We are seeing economic opportunities open up across the world, none more so, than those in South Asia.
Therefore, leverage your strengths and seize every opportunity to transform your investment narrative into the currency of reputation, and be better, and more competitive for it.
Thank you.