The Ever-Changing Face of Finance with Jen Abate

“It was a pretty indirect route to Lazard and then a very long-tenured and direct journey at Lazard. What I thought would be a great stop on my career path to learn about finance has turned into my entire career, and it’s been a great journey,” shares Jen.

That path has fortunately led Jen to become an invaluable financial resource that we get to learn about. Jen shares her unique journey in the intermediary business and reflects on the major industry changes she's witnessed. This revealing exploration dives into her insights on:

• The ever-changing face of the finance industry
• The crucial role of solution-focused asset management
• The importance of infrastructure investment
• The increasing impact of ESG (Environmental, Social, and Governance) considerations
• Her vision for the industry's future.

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Jen has seen the investment landscape undergo significant changes over the years. The one change that stands out to her is "the significance of the intermediary business." She notes the industry has evolved to meet changing investor expectations and outlines the subsequent shift in what advisors now expect from asset managers.

“From when I started to where I am today, it is just the significance of the intermediary business,” shares Jen. “And alongside the significance of the intermediary business and the noble role that the intermediaries are playing with the financial longevity of so many individuals - as well as so many really high-end complex institutions - that that growth, that significance has all been done during a very vast period of consolidation and expansion.”

And alongside this change is the continued but perhaps even increased need for far more comprehensive and personalized expectations that clients, whether they be institutional clients or direct individuals, need from their intermediary financial advisor or consultant.

Abate views her industry’s agility to adapt to these evolving needs as instrumental in keeping dedicated advisors both fulfilled and engaged. "With the consolidation and expansion of our industry, the significance of the intermediary business and their crucial part in upholding the financial stability of individuals and institutions has escalated,” notes Jen.

In the evolving world of finance, a significant shift Abate spoke of was the move towards solutions-based investing, a pivot away from a purely product-focused model. She emphasized that understanding and meeting the distinct needs of every investor and advisor with integrated, comprehensive solutions is the way forward. The onus, she added, lies with research analysts and portfolio managers to deliver these solutions using a fundamental lens.

As Jen rightly puts it, “If you're only bringing a product to bear, then you can only be relevant at a certain time and point. And I think all of us want to be exceptionally relevant and indispensable to the clients that we're working with.” By offering tailored solutions to clients, asset managers can ensure continued relevance and establish strong, unshakeable relationships.

According to Abate, this necessitates an in-depth understanding of each client's unique business model and requirements and demands a delicate balance of excellent relationship skills and technical expertise. A product-focused approach can restrict your relevance. As solutions-based investing becomes more dominant, advisors have to be creative in their efforts to stand out to clients as a valuable asset.

Is it better to swim in every opportunity pond or commit to swimming in just a few specialized ponds?

It all comes down to where you invest your time. For Lazard, the solutions they bring to the marketplace are targeted in those specific areas where they believe they have a distinctive and established competitive edge.

Lazard is a robust architect of solutions for their clients, grounded in a core style of investment. International and emerging markets, US equity - these are the territories where Lazard is immersed. The quality buddy business has significantly expanded, particularly in the US and on global runways. The ability to deliver preferred listed infrastructure is a path Lazard carved for themselves, setting them apart from the competition.

However, all this is rooted firmly in Lazard's foundation of fundamental research analysis. Jen firmly believes in the organization's approach of maintaining a tight-knit, team-based connection between research analysts and portfolio management teams. This allows for a comprehensive view through the fundamental lens, demonstrating how these core elements can add a unique touch to quantitative decisions.

Moving past the intermediary space, within the organizational structure, Lazard brings a wide range of global solutions to bear. Areas like emerging market debt and Australian equities are where the organization has established a strong presence.

Now it’s about establishing connections with downstream clients whose needs align perfectly with the spots your firm has chosen.

In the realm of infrastructure investment, Abate speaks highly of Lazard's global reach and noteworthy expertise, especially through their Global Listed Infrastructure Fund. She explains that owing to their impressive stability and diversification benefits, infrastructure investments are increasingly being viewed as valuable alternatives. Furthermore, Lazard is also branching out into private infrastructure investments, offering a variety of options to cater to a range of financial needs.

"Infrastructure investments, with their stable cash flows and low correlation to other real assets and fixed incomes, stand out as defensive equity in portfolios,” shares Jen.

Lazard's distinctive approach to incorporating ESG factors into its investment strategy sheds light on a crucial aspect of modern financial management. By focusing on identifying ESG-related alpha and risks, Lazard ensures thorough, data-driven investment decisions that prioritize financial productivity. Abate also acknowledges the division in client preferences regarding sustainable investment practices, emphasizing the importance of personalizing investment strategies to align with each client's unique needs and values.

As for the future of the industry, Jen is optimistic about the potential of AI and technological enhancements. She believes that these advancements will enable more "mass customization that feels a lot more personalized" and cater to a wider range of client needs.

Abate predicts substantial industry shifts influenced by generational preferences and technological advancements. She observes the growing demand for personalized and tailored financial experiences from younger generations who are tech-savvy and well-informed. To meet these evolving needs, she suggests adopting strategies that offer individualized tools and solutions. On another note, she also notices the increased female representation in the finance sector and reiterates the importance of a more focused approach to retirement planning.

It’s apparent that Jen’s insights offer an invaluable compass for navigating the complexities of today's financial industry. From her intriguing career trajectory to the crucial role of solution-focused asset management, the potential of infrastructure investments, the impact of ESG considerations, and her vision for the industry's future, Abate's perspectives provide an enriching roadmap for finance professionals and clients alike.

The insights from Jen provide a clear understanding of the changing landscape in financial services. As we look ahead, the rise of the intermediary business, the move towards solutions-based investing, the role of infrastructure in portfolios, the conversations around sustainable investing, and the necessity for personalized retirement solutions are key focal points. As this evolution gathers pace, adapting and staying aligned with the changing needs of clients becomes mission-critical for every financial professional.