Innovation & Disruption – Keys to Professional Development – Key Note Address

Contributed By – Venkitesh Iyer CFA

Saurabh Mukherjea CFA was the keynote speaker for the event in Bengaluru on February 6th 2016. He spoke about “Building a career in financial markets by using the CFA” which addressed many questions in the minds of young charter holders who were present at the event. He focused on three questions in his talk:

1.Why build a career in finance, when many other professions exist?
2.How does the CFA charter help build a career in finance?
3.What should one do beyond the CFA charter to enhance his/her career?

1.Why build a career in finance, when many other professions exist?
Noting that in India the needs were many and there is poverty and a failure of governance, Saurabh believes that if this needs to change, the financial sector would need to grow and contribute – as an example, the credit penetration ratio in India is a meagre 12%, while it is at 40% in China and up to 90% in many developed nations. He also highlighted the scope for growth in financial services – for instance a lot of asset managers in a country like Canada manage Equity Assets in excess of $50 bln, while the largest Equity Asset Manager in India (HDFC) manages just $12 bln. Recent growth in Equity Savings plans and Asset Under Management (AUM) he believes though is encouraging- mutual fund SIPs have increased from 7 million to 10 million while Equity assets in the industry has moved from $45 Billion to $65 Billion (even as stock market levels haven’t moved during this time). He also thinks that growth has just started and that all of us can participate in this growth by building one’s career in-line with this growth. He sees the next big career opportunity as being in India’s bond markets, given that 90% of outstanding bonds are rated AAA. According to him, once the bankruptcy code is in place, AA & A rated bond issuance should then follow.

2. How does the CFA charter help build a career in finance?
Saurabh shared his personal experience of joining Anderson consulting in late 90’sand his difficulties with figuring out the MECE concept thereafter. While he continued struggling with this problem, one of his friends suggested that he pursue the CFA program. The CFA program helped him become more organized in his thinking. Analogies he spoke about were comparing a pile of bricks (unstructured) with a brick wall (structured) and a pile of clothes (unstructured) with clothes in a cupboard (structured).
Similarly, the financial world has a lot of information and complexity. The CFA program puts everything together in an orderly manner and creates a structure which is easily understandable and usable. It helps to structure one’s mind which in turn helps to analyse the complexities better. He believes that with the Indian economy becoming more complex – the need would be for financial professionals to manage such complexities.

3. What should one do beyond CFA to enhance career?
Saurabh believes that attaining a CFA charter while initially providing professionals opportunities, may not be sufficient to sustain a professional’s career over the long term. In search for reasons on why some investment professionals thrive while others don’t, he witnessed first-hand a question from a business channel news anchor addressed to Mr. Sanjoy Bhattacharya (founder CIO HDFC AMC) as to “What the key to success in the Investment Profession was?” He replied that it wasn’t either an ‘MBA or CFA’ but was in fact the trait of ‘Humility’. Mr. Bhattacharya highlighted the importance of Humility in ‘Investment Management’ as it eliminates overconfidence, overtrading, and reduces predictions and aggression.

Saurabh then noted that skills are infinite and one needs to keep acquiring it over the span of one’s career. He quoted Albert Einstein “It’s not that I’m so smart, it’s just that I stay with problems longer” He closed his address with a statement that most successful people are humble, well-travelled & well read.

-VI