Series Twelve, Episode Two: Ethical Finance, Faith and Enlightened Leadership

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In this episode host Julia Streets is joined by Professor Atul K. Shah, a broadcaster and Lecturer at City University in the Department of International Politics, who has written many books on topics including ethical finance, accounting, risk, diversity and sustainability, and Anjli Shah, Investment Director at Aberdeen Standard Investments.  They discuss Jain wisdom, sustainable and ethical finance in our current economic climate. Together they focus on leadership skills, the contribution of faith, and how ethical and belief frameworks are valuable in today’s organisations and contribute to developing enlightened leaders.

Anjli Shah

Anjli Shah is an Investment Director at Aberdeen Standard Investments and is the manager of the ASI Global Mid-Cap Equity Fund. She also has lead responsibility for covering US Small and Mid-Cap stocks within the Smaller Companies Team. Anjli has been with the company for >5.5 years, having joined as an analyst focused on covering Southern European Small and Mid-Cap stocks. Anjli was highly commended in the Investment Analyst of the Year category at the 2019 Women in Investments Award. Prior to her career at Aberdeen Standard Investments, she worked as a sell-side equity research analyst at Oriel Securities and later Stifel Securities in London. She started her career on the graduate programme at the Financial Services Authority and, post Banking Reform Act, the Bank of England. Anjli holds a BSc (Hons) degree in Economics from the University of Warwick and is a CFA charterholder.

Professor Atul K. Shah

Professor Atul K. Shah is an accomplished thought leader, writer, lecturer and broadcaster, with a PhD from London School of Economics, and has published international books and research papers in renown journals. His work has been profiled in Forbes, Guardian, Financial Times, Economia and on BBC Radio. Books published by Routledge include 'The Politics of Risk, Audit & Regulation - A Case Study of HBOS'; 'Jainism and Ethical Finance' (jointly with Aidan Rankin); 'Reinventing Accounting & Finance Education - For a Caring, Inclusive and Sustainable Planet'; and 'Celebrating Diversity'. Journals in which he has published include Accounting, Organisations and Society; Accounting, Auditing and Accountability Journal; European Accounting Review; Journal of Financial Regulation and Compliance; Business Ethics - A European Review;. Professor Shah has taught at the London School of Economics; University of Bristol; University of Maryland; University of Essex; University of Suffolk; and Middlesex University. He is a qualified Chartered Accountant and member of ICAEW. He is passionate about Cultural Inclusion and Ethical Finance and continues to provide global academic leadership in a number of critical areas relating to finance, accounting and corporate governance and regulation. He is a sought after speaker and broadcaster.

Series Twelve, Episode Two Transcript

Julia: Hello, my name is Julia Streets, and welcome to DiverCity Podcast, talking about equality, inclusion, and diversity in financial services. On the podcast we seek to shine a light on positive progress, call out areas requiring further focus, and offer lots of ideas to help drive change. Before we get started today, I just wanted to take a moment to thank our friends at CityAM for their continued support of DiverCity podcasts. Publishing and promoting both our episodes and our supporting blog series, so their readers can stay on top of the very latest diversity and inclusion debate. And you might want to check out CityAM’s own podcast called the City View for all the latest news and opinion from the City, because we at DiverCity podcast are huge fans.

Now today, I’m delighted to be joined by professor Atul Shah and Anjli Shah. Let me tell you a bit about each of them. Professor Atul Shah is a professor at the City University. He’s a writer and he’s a broadcaster, and has published many international books and research papers. Now, these are ranged from the politics of risk, audit and regulation. He was the joint author of Jainism and Ethical Finance. He’s written books about reinventing accounting and finance education for a caring, inclusive and sustainable planet, and also celebrating diversity. Professor Shah, Atul welcome to the show.

Atul: Pleasure to be here. Thank you Julia.

Julia: And joining Atul today is our second guest, Anjli Shah. Anjli Shah is the Investment Director at Aberdeen Standard Investments, and is the manager of the ASI Global Mid-cap Equity Fund. She also has lead responsibility for covering US small and mid-cap stocks with a smaller companies team. And she was highly commended in the Investment Analyst of the Year category at the 2020 Women in Investments Award. Anjli, it’s wonderful to have you on the show. Thanks for joining us.

Anjli: Thank you, Julia. It’s a pleasure to be here.

Julia: I ask all our guests when we start this conversation, I’m really keen to hear what you’re up to at the moment. Anjli, can I come to you first of all?

Anjli: My role at the moment is running a fund, and also while running the fund, covering US small and midsize companies. Finding new companies to invest in on behalf of our clients. So that’s what’s keeping me busy on a day-to-day basis. In terms of diversity and inclusion, I’m involved in a number of things that my company, Aberdeen is doing in terms of improving diversity and inclusion. For example, I am a steering committee member of Unity, which is our employee-led race and multicultural network. I am also a committee member of the IAG, which is our Investments Advisories Group. This is really to promote diversity and inclusion within the investments function of Aberdeen.

Julia: This is really important, isn’t it? Because it’s so essential that the conversation about diversity inclusion is embedded in a commercial point of view. I have many questions. We will get onto some of those for sure. Thank you so much. And it sounds like you’ve got a lot on your plate. Atul, may I ask you the same question? What are you focused on right now?

Atul: I am teaching right at the beginning of our first term to a fresh crop of students, 18 year olds, there are apprentices working in various organisations, and bringing a whole world of enthusiasm to the classroom. And rather than trying to breathe a new set of facts and figures down their throat, I’m actually starting with their enthusiasm and the kind of skills and culture and confidence that they bring to the classroom, and explaining to them what is distinctive about my approach to education where I build on culture rather than destroy culture and pretend that the students know nothing and I know everything.

Julia: Wonderful. And there are a number of things you talked about there in terms of skills, confidence, and cultures. Really interesting. I think we’re going to come back to that a little bit later on in the show as well. First of all, I wondered if I could start with opening the conversation, we were talking in my introduction about ethical finance, one of the books that you’ve written, Atul. But also, I’d love to hear more about your faith, if you don’t mind. I know that faith is very important to you both as well. And I’d love to begin to explore Jainism as a religion. And also how your faith and your working lives combine. I wonder if I could come to you first, Atul. Very keen to hear your thoughts about that. And also any research that you’ve done or any conclusions you’ve drawn.

Atul: Thank you, Julia. Faith of course has many meanings, in the Indian Dharmic tradition, faith is called Dharma. And Dharma means the science of sustainable living. Now just think about that for a moment, Julia. At the time when we have got such a huge climate crisis, we are all trying to suddenly develop a new solution to the crisis when we have a whole several 1000 year old bank of wisdom and science which says that we are nature. Nature is not separate from us, and has said that when the human species was not in crisis. So I am so excited to draw up on that whole gold mine of wisdom and share it with the world.

Your question about the Jains. The Jains represent one part of Indian Dharmic wisdom. I guess the most famous Jain is Mahatma Gandhi, whose whole practise and science of nonviolence actually came from his guru, Shrimad Rajchandra, who was a Jain entrepreneur. So in my field of business we have, again, philosophers, entrepreneurs out there who are very intelligent, but also very good at business. The primary belief is non-violence, or respect for all living beings, not just human beings, but all living beings. In fact, there’s a greater obligation to respect the weak and the small. So for example, when my son was young I taught him not to kill insects. And underlying that message was this idea that anyone who is smaller and weaker than you should be protected and supported rather than stamped upon and bullied.

Julia:

Anjli, can I bring you in here as well? Because I’d love to hear your thoughts about how your faith and your working life combines as well.

Anjli: I think it’s a really interesting question. I’m 32, and a lot of people my age wonder how faith plays a relevant role in their day-to-day lives. And it perhaps might not be overt, but I think it’s there in the background in terms of the way you think, the way you behave, and all of that translates into our working lives which play such a significant portion of our day-to-day time. So when I think about the Jain religion, I really think of it as being a religion of self-help. There’s no gods or beings that are suddenly going to make everything right for you and life will be wonderful, but it’s more about improving yourself as a person. So when you think about the three guiding principles of Jainism, so right belief, right knowledge, and right conduct, I think all three of those beliefs or principles are applicable to our day-to-day working lives.

If you consider me as an example, in my day-to-day role you’re constantly having to research new companies to potentially invest in. We know markets move at a very, very rapid pace, every day is different. So there’s a continuous need to always improve one’s knowledge. We’ve all unfortunately experienced the global financial crisis. We’ve all read about some of the excess risk-taking that occurred during that period. So this is why right conduct is also very important. Why are we making these investments? Are we putting our clients first? Have we considered downside risk?

And finally, right belief. Why are we doing this? Are we doing this for the right reasons? When I think about my role, what motivates me is not money or worldly possessions, but really helping others achieve a sense of financial wellness and security, and making sure we do it in the right and ethical manner.

Julia: It’s fascinating, because listening to the two of you talk about Jainism, but also about financial services and also ethical finance as well, it strikes me there are two major pieces coming out of that. One of them is conduct, and the other is culture. I’d love to get your reaction to that. Atul, can I come to you first of all?

Atul: Money is a social construct. It was created to help human society grow, to build human relationships, and to help people exchange and trade. In that sense it has to be a cultural construct. But unfortunately what has happened, and my academy has a big role to play, we have made money into an instrument and a technique and a method of exploiting, expropriating, dominating, and almost bullying society into making profits and growing wealth, etcetera, and insecurity related to that. At a very simple level, I think what I’m trying to do is to bring money back to its origins, to its grassroots, and help people understand the nature and limits of money. And then from that perspective, it’s so much easier to build a finance education where culture is central, where meaning and purpose. Anjli spoke so eloquently about her job having meaning and purpose. That is exactly what is needed in this climate crisis that we have.

Our faith helps us to put meaning and purpose right at the centre. And in a way, that’s what I tried to do with my students. I said, “I can give you a piece of paper and a good mark for your course. But if in addition to that, through your education you develop a higher sense of meaning and purpose for yourself, then this education will last much longer than when you graduate from here. So let’s work at that.” And each of us are different. Each of us have different histories, backgrounds, etcetera. But we can work with that and build something from that.

Julia: This is really interesting, because in many, many conversations I’ve had with senior leaders all the way through the financial crisis, all the way through the pandemic, everything happening, I think particularly in Britain and Brexit, etcetera, but of course I talk to any of our listeners around the world, and everybody’s got a socioeconomic geographic dimension of play, purpose comes up all the time. All the time, this one. Anjli, I’d love to get your thoughts on when we think about the conversation about sustainability and climate change and ESG and purpose, I’d just love to hear your thoughts about the intersection and the interplay where faith and financial services come together.

Anjli: I think, again, like for me, it’s not that it’s so overt. I mean, there certainly are products that cater for a religious segment. For example, the Sharia financial instruments out there. But I think it’s more in terms of the financial products that we are buying, why are we buying them? Do we want to generate wealth for ourselves, but in a manner which is beneficial to wider society? You mentioned ESG there. So ESG is a very, very topical issue at the moment within financial services. A lot of clients and a lot of investment houses are launching ESG-friendly products. When you consider what ESG stands for, so environmental, social and governance, we want to invest in companies that are well-run, that are run for the right reasons, whether it’s diversity of thought, diversity of representation. We also want companies that are doing social good. for example, are there companies out there which are disruptive business models or very innovative in nature that really helping to address big issues.

For example, within the healthcare industry there’s a number of medical device companies out there which are really changing the way we manage certain diseases, and really improving the quality of life of patients. And finally environmental. There’s a lot of focus at the moment on things like carbon emissions, and also are we manufacturing things in the right way? I mean, certainly as of today in September 2021 we’re all reading about the headlines around supply chain shortages, fuel shortages. This is again why thinking about alternatives which are good for the environment is really important. I think when you have financial backing and you’re able to invest in companies which are doing good, that should improve things for the better for everyone.

Julia: I wonder if we can move the conversation just a cog shift along, if we may. Because at the heart of all of that, achieving everything we’ve talked about, lies the question of leadership within organisations as well. We talk a lot about enlightened leadership. This seems to be my kind of mode de jour, it is the ‘mode ‘ of the year actually. So when we talk about enlightened leadership, I’d be really keen to hear also about skills. Atul, you were saying this is the very beginning, thinking about skills, culture, and confidence. When we think about leadership skills and characteristics that are inherent not only to the faith, but also into the industry as well, and how they’re valuable and should be recognised as valuable in today’s organisations. Atul, can I come to you first?

Atul: Thank you, Julia. Wonderful question once again. There are thousands of books on leadership. But if you look for a book on what is good leadership in finance, you will struggle. I don’t know if you know that, but because good leadership in finance has to begin with conscience and a sense of responsibility and accountability to society. And of course, the conventional model in finance is profit maximisation and materialism. So you have a direct clash between that model of leadership and this kind of selfish capitalistic model of greed and profit maximisation. I’m actually writing a book at the moment on leadership in finance, and on what good leadership in finance looks like. One of the distinctive things about faith, and I hear this even when I’m listening to Anjli, is that faith gives people a conscience, an almost an innate sense of responsibility to others. That is not something we can teach in a university. I tell my students, “I can’t give you a conscience, but it is something that you nurture through your experiences, your upbringing, and a sense of higher purpose.”

I give them scenarios. Sometimes I say, “Okay, suppose you do strike it rich and become a multimillionaire at 30, what are you going to do?” Are you going to go onto a beach with all your money and sit idly by? Or would you rather make your income by making others happy, others fulfilled and satisfied, others prosperous such that they go around telling others about you, and your work does not stop? And you too find meaning and purpose in your work.” So rather than preaching to them I actually give them these kinds of scenarios very early on. It’s so interesting once in a while to hear back from students who have graduated, and saying that how it has actually made a difference to their life and career.

I think universities should really understand what they can teach and what they cannot teach, and work with the experiences and culture that the students bring to the classroom. Acknowledge that and build on that, rather than treat them as ignorant and print science as something very universal, very a-cultural, very technical, and something that everyone needs to learn in almost like a preachy kind of way, without using the word preach.

Julia: Anjli, I wondered if I could bring that back in to a corporate context, if I may. I’d love to hear your thoughts about enlightened leadership and where the importance of faith comes into play, particularly in the world of financial services from your point of view.

Anjli: It’s a really interesting one, because I think for me personally you still have to maintain neutrality and ensure that, for example, the stocks that you’re buying fit your fund mandate or your client’s objectives. You have to be very careful not to let your own personal preferences or own personal beliefs get in the way of that. So for example, it might make sense to buy a company which is manufacturing different food products, including, say, meat based ones, but your religion might be one where they forbid you from eating certain types of meat or encourage you to be a vegetarian. I think it’s important that you have to almost distil those two parts, distil what is your personal belief on what is right for you in the corporate sense? But I think the qualities of what makes a good leader, things like being open and transparent, a willingness to listen to others and improve one’s knowledge, I think are really important. Because as we know, a business is only as good as its employees and how it treats other people, including customers.

 

The more we can display these kind of characteristics and behaviours, I think the more you get out of your employee base, the more you get out of how you’re perceived in wider society. Atul spoke very eloquently about the conflict between profit making and faith. I think at the end of the day, yes, I do work in a corporate world and the goal is to maximise profits, but it’s the manner in which we go about doing it. And then once we have those profits of course you reward your shareholders, etcetera, but are you as a corporate entity making, say, charitable donations? Are you doing things like mentorship schemes or graduate placements, or reaching out to people who are perhaps underrepresented or discriminated against? And I think this is where that kind of profit generation can be used for the better.

Julia: Anjli, I wonder if I could move the conversation on just a fraction. Interested you used the word discrimination, one of the things that comes up a lot in the conversation about diversity and inclusion, particularly when we talk about faith, is that people have felt that it’s better to leave their faith at the front door, even though, as we’ve described, it’s so embodied in everything we want to achieve, how we lead, and how we behave as well. I’d just love to get your thoughts about, have you ever experienced any sort of discrimination? Has this been your reality?

Anjli: I’ve been very fortunate that I haven’t experienced faith-based discrimination. I certainly haven’t felt the need to hide my faith when I’ve walked through the office, or gone for interviews. But I think perhaps you might not express it openly and shout at the top of your voice, “Hey, I’m a Jain, I’m a Jain,” when you enter the office. But I think the fact that Jainism perhaps is less well-known than other world major religions means that people are often curious to understand what is Jainism, what are the beliefs, what festivals do we celebrate? For me, it’s really keeping an open mind and helping to improve everyone’s knowledge about what is Jainism.

From a financial services perspective, certainly there’s more and more work being done to make the environment as inclusive as possible. As an organisation, getting together to celebrate different festivals, to have various documentation or articles written by different members of your employee based around what are they celebrating at the moment. I think it’s really, for me personally, just about being open-minded and learning from others. I think it’s just a case of understanding one another better.

Julia: It’s really important, isn’t it, that we actually have that sort of mindset. It’s wonderful to hear you talk about the attitudes to wanting to embrace that. I wonder, Atul, if I could ask you just on the conversation about performance as well, and your experience of the ability to express your faith openly, and its relationship with the results and the performance and the impact, if I may. Love to hear your thoughts too.

Atul: Thanks again, for a fantastic question. The belief that money is the key to the happiness is a faith. That faith is embedded in the way economics is taught and finance and accounting are taught. Research shows that above a certain level more and more money does not bring happiness. So what really is faith? Tell me. Science, the way I see it, is hugely dogmatic. In fact, and there are many researchers who are saying that the science of finance is extremely dogmatic and fundamentalist. In terms of my prejudice, definitely the moment I talk about faith in an academy, in a scientific circle, then I experience a lot of intellectual prejudice. Not prejudice against my skin colour, but prejudice saying that, “Oh, this guy is a fundamentalist,” or, “He’s talking about Jain. Excuse me. How do you spell the word Jain?” Sorry, it’s something very marginal, very fringe,” etcetera, etcetera.

I have been destroyed when I have presented Jain papers in of an audience as well. So personally, it’s quite humiliating as well, I’ve experienced that from peers even very recently. These issues are there, but what I do is, like Anjli, actually we don’t wear faith loudly on our sleeves. We actually keep quite quiet about our faith, and instead live through example. And then when people come to ask us, we can say, it actually happened this Friday. Funnily enough when I was teaching, one of my students actually came to me and said, “What is Jainism?” So she was extremely curious. But we don’t speak about it.

Julia:

It’s interesting, because I think about every organisation I go into these days talks about the importance of having a curious workforce. The fact that you end on the word curiosity, and then also as Anjli was also saying about how organisations should become much more curious about faith, what it means to individuals, the practise of faith, and also the structures and even the calendar of faith. It’s fantastic. I would love to take a moment here to bring in Cynthia with some research to support today’s discussion.

Cynthia:  Promoting the engagement of faith-based finance is a core component of the Path to COP26 campaign. The campaign mentions that the finance sector needs to act together to achieve decisive action at COP26, and faith groups have the ability to provide moral leadership, and bring together diverse voices from around the world.

In the UK government’s 2019 report Investing a Better World: Understanding the UK public’s demand for opportunities to invest in the Sustainable Development Goals:

  • 3 in 5 people believe that financial institutions should avoid investing in companies that harm people or the planet. 
  • 30% say that they do not think businesses apply the same ethical and environmental standards in poor countries as they do in more developed countries. 
  • Over 70% of people say they want their own investments to avoid harm and achieve good for people and the planet. 

Julia: Thank you, Cynthia, for the research to support today’s discussion. And as always, links to the research can be found on our website, www.divercitypodcast.com. Don’t forget that’s DiverCity with a C, not with an S. And that’s where you can find all our episodes and sign up for early notifications of future recordings. And, if that’s not enough, we’ve just brought out a new newsletter called DE&I, That Caught Our Eye. That was put into your inbox, some of the latest stories and updates and findings in the industry, so you have the very latest at your fingertips. Please do follow us on Twitter, Instagram, Facebook, LinkedIn. And DiverCity podcast is available on BrightTALK and all good podcast channels. By the way, we’d love a rating because it all helps to promote the show.

There’s so much that came out of the first section of our conversation today, and when I think about the broader conversation about diversity inclusion, role models really, really matter. Atul, in your world, you’re a great role model for your students. Tell me, who are role models to you?

Atul: Bineet Shah at Barclays was appointed just after the famous libor crisis at Barclays to do the overall interest rate submission for Barclays. Now, I bet you he was not appointed because he was a Jain, but he was appointed because he was felt to be trustworthy, reliable, disciplined, and honest, so he’s one of my heroes.

Ashish Patani, who is a chartered accountant and also worked in senior leadership roles at Citibank, is an extremely able and generous community leader in our community. So here’s an example of a leader who understands his mission to serve wider society, and is willing to work selflessly late into the morning hours to advance the community, to support young people, and to make sure that the Jains in UK go beyond the spelling and are actually seen as a rich cultural heritage which is helpful for the whole of Britain.

Kamal Shah is a senior partner at Stephenson Harwood, which is a law firm. He’s the head of India and Africa. And if I’ve looked at the way he practises law, he puts culture right at the very heart, and relationships. That’s also how he has grown his practise and his goodwill. He’s an award winning, multi-award winning lawyer, and very young, but extremely charismatic and also organised and disciplined.

Julia: Well, of course, I mentioned in the introduction there, we have with us the highly commended, the Investment Analyst of the Year category in the 2020 Women Investments Awards. So there’s another role model for you there. Anjli, I don’t want to embarrass you when I say that. But seriously, many, many congratulations on that. One of the things we talk about in the field of diversity inclusion is that we’re complex human beings and we’re not one dimensional in any one shape or form. And I just wondered if you had any sort of final thoughts about identity as a woman in the city, a woman of faith in the city, an investment manager of greater claim in the city. Your thoughts on that?

Anjli: I think that’s the really interesting point, because I think identity is such a multifaceted concept. We are not just one thing. We’d not tick just one box. I’m an ethnic minority female who attended state school, who lived in London, who now lives in Edinburgh. There are lots of different aspects to all of us. I think when we think about diversity and inclusion, it’s very tempting to put people into boxes or label them. But actually I think all aspects of diversity and inclusion are interconnected and interlinked. So actually having that diversity of background, thought, different physical characteristics, different mental diversity, etcetera, I think all of that is really important to consider as a whole when we’re thinking about what can we do to improve diversity and inclusion in the City.

I think for me it’s about trying to level up the playing field, if I can put it that way. We know that certain backgrounds may have had an advantage when it comes to getting their foot in through the door when it comes to job applications in the city, or perhaps get promoted faster. It’s not to say that others are incapable or that we should have some kind of tokenism gesture that means that, quote unquote, we’re lowering the standards for everyone. No. It’s about having a level playing field to make sure that there’s equal opportunities for everyone to realise their true potential.

Julia: And that strikes me that completely chimes with exactly so beautifully described what the faith of Jainism is all about, which is lifting up those who are perhaps smaller than others. Exactly as you were saying, Atul. And then also the whole point about social inclusion as well. I have to say it’s been a fantastic conversation, if you think about it, a really short period of time. Thank you, firstly, for explaining Jainism to the audience as well, but then also to discover this from and explore it from so many different perspectives, culture, leadership, discrimination, what it means in terms of doing our jobs well, what it means in terms of teaching the next generation, and also thinking about role models and also identity. Atul, Professor Atul Shah, thank you so much for joining us today.

Atul: Thank you. Thanks for having us. It was a fantastic conversation.

Julia: And Anjli Shah, thank you very much for being on the show.

Anjli: Thank you, Julia. You’ve asked some really insightful and thought provoking questions. I’ve really enjoyed it. Thank you.

Julia: And to all our listeners, I hope you’ve enjoyed the conversation as much as I have. Thank you for listening. I’ve been Julia Streets. We’ll have another episode coming your way very soon.

Kieron: This episode of DiverCity Podcast was produced by me, Kieron Yates, on behalf of Julia Streets Productions. Thanks to Cynthia Akinsanya for her insights. You can find out more about the guests on this week’s show on our website, divercitypodcast.com. And that’s diversity with a C, not an S. Whilst you’re there you can also sign up to our newsletter for all our latest updates. All our episodes are available in Apple Podcasts, Spotify, or your favourite podcast app. If you enjoy DiverCity podcast, remember to share on social media and give us a rating or review. It really helps promote the show to a wider audience. Finally, our Twitter handle is @divercitypod. Thanks for listening.