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The march of AI or artificial intelligence is truly upon us, highlighted by the fact that as I type, my keyboard is predicting what I am going to type next, and is often correct. Gosh, so predictable!

At an extremely interesting client presentation recently, fund managers from the Sanlam Artificial Intelligence fund explained to us that “Things that people called ‘pipe dreams’ when the fund was launched in 2017 are now happening. The changes have been utterly extraordinary. What was impossible is now possible.”

A fascinating timeline showed how algorithms have achieved superhuman levels in chess and other games such as Go in a very short space of time, and how AI platforms were teaching themsleves to walk, create their own languages and understand human vocabulary at an increasingly exponential speed.

There’s no doubt that changes brought by AI within healthcare, agriculture, transport (to mention a very few) are literally saving lives and may help to save the planet.

However, the very night after this event, I was reminded about the limits of AI in the arena of customer service. One area where chatbots and robots haven’t quite nailed the human touch yet.

My teenage daughter and her friend had arrived at a hotel in Portugal late at night, to be told that their room booking had been cancelled by the online booking service they’d used months earlier. This was human error (or greed) on the bookings service part, no robots at fault there. However, her booking was confirmed so a bit of a disagreement ensued but as the hotel was now full, she needed to contact them as they now had nowhere to stay. So then she (in Portugal) and I (in London) tried to communicate with the bookings company to get the issue sorted. We both experienced the same fate…

The phonecall was answered clearly by a robot – who requested the confirmation number. That was easily done. There then ensued some fake typing noise, I suppose to suggest that someone was actually typing into a computer to check something out, before a robotic voice informed that they had been waiting too long for our information and would have to end the phone call. At gone midnight – and having gone through this process twice I was definitely not impressed. The situation was not resolved until the following day – and took human intervention via twitter direct messaging to sort out.

While AI is clearly the future, companies should beware that they are not jeopardising their hard-won reputations for short-term cost savings. The message is that the nuances of real life problems often need to be resolved by humans; and human customers are not happy when they have to battle with companies’ attempts to deflect issues to our robot brethren, before they are quite ready.  

Photo by Alex Knight on Unsplash

We are all thinking about how we can do good, do better, do the right thing when it comes to our communities and our global village. In a nod to ‘giving experiences not things’ – and in recognition that when it comes to ESG – the ‘S’ has been on the back burner – companies are increasingly looking to make a difference rather than a donation. And one such difference and an experience and a donation, is the notion of the 1% Club.

Matt Norris, who runs a fund investing in Real Estate Investment Trusts (REITs) has written about this initiative for companies to invest 1% in meaningful projects, taking inspiration from a particular REIT, the purpose built student accommodation REIT, Unite Students.

A decade ago, Norris highlights how Unite Students created the Unite Foundation to provide “accommodation scholarships for care leavers and estranged young people.” The Foundation has a clear social purpose, seeking to “transform the lives of young people by enabling access to higher education.”

In the past ten years, the Foundation has awarded over 500 accommodation scholarships to students who lack the support of a family.

“This initiative clearly aligns the commercial side of Unite’s business with the delivery of positive social impact for students and communities over the long-term,” says Norris, adding “It’s worth noting that over this same 10-year period investors in Unite Group have benefitted from strong returns too.”

And now to increase the significance of this commitment, Unite Students now targets to invest 1% of profits into social impact initiatives annually. Norris hopes that as investors grapple with how to assess the social impact that companies are making on wider society then such initiatives may grow.

He asks whether this could be the making of the 1% Club, whereby REITs allocate space equivalent to 1% of their annual profits to relevant good causes.

For example, he says office REITs could allocate space in their latest campus developments, as opposed to the stuff earmarked for near-term demolition, with a rental value equivalent to 1% of their profits to charities. Or shopping centre REITs could allocate 1% profit equivalent space to youth centres looking for a town centre home. He adds that such actions are clearly measurable, helping to bring clarity to the ‘S’ factor and potentially move it up the ESG agenda.

And of course, it isn’t just REITs with space to proffer to communities that could take the 1% idea – on a corporate, individual, national and local governmental level where there is office or retail space (flats above shops) being under-utilised or just plain left empty – with imagination and effort we could be creating social spaces, living spaces, homes for homeless.

Now that is doing the reit thing.

Photo by Brooke Cagle on Unsplash

What are the main topics of conversation on my commute into London? The horrors in the Ukraine, inflation, party-gate? No, none of these; it is which days people are working in the office, which at home and how they are adjusting to the ‘new new normal’. Is the four day week inevitable?

Businesses all over the country have reacted very differently to the post-pandemic world of work.  Some like the large City banks are mandating staff to revert to the full pre-pandemic Monday to Friday working regime, whilst others are taking a rather more flexible and pragmatic approach.

Of course, there are many more issues at stake here than merely hours in the office.  Whilst many staff have enjoyed the working from home experience, others have not, missing the buzz and camaraderie of an office environment. 

One thing is for certain, the adoption of Zoom and Teams meetings during Covid-19 means that those meeting mediums are here to stay, leading to much greater time efficiencies and lower travel costs and an end to the often travel-related stress.  

Going forward, an organisation’s WFH policy is going to be a significant factor in both retaining and attracting new talent and – if not already explicit in the job ad – is  likely to be right up there in the interviewee’s top three questions. A busy time for all HR departments for sure.

How companies react depends very much on the type of business they are in or whether they feel they can trust their employees not to abuse a much more flexible and self-empowering approach to the working week.  Client facing service sector businesses clearly need to ensure quality of service is maintained but balance this against the risk of wholesale resignations should they revert to a zero flexible working policy.

Some firms are taking quite a radical approach, with PwC, for example, announcing that its 22,000 staff can finish at Friday lunchtime over the summer.  Others may follow and this will almost certainly be the precursor to the official four day working week that many have been calling for to create ‘positive well-being’ and a better work life balance.

Image credit: Isabel Andrade on Unsplash

Now the ISA season is over, is that it for clients investing into their ISA pots till next year? Does the flurry of activity pre-5 April to encourage investors to use their ISA allowance before they lose it? Does it risk savers missing out on the opportunities presented by pensions?

And will any manage to save anything anyway for the foreseeable future?

Providers and advisers have a role to play in encouraging them to and in promoting pensions as much as ISAs. The two should go hand in hand.

But it is not going to be easy.

Many people lost their jobs as a result of the pandemic and the age-old (excuse the expression) scandal of the over fifties being overlooked for jobs is still evident.

And of course, the effects of the pandemic lockdown on the economy has been superseded by Russia embarking on a war with Ukraine.

Cost of living rises

The Office for Budget Responsibility (OBR) heralds worse to come for the consumer.

‘The conflict also has major repercussions for the global economy, whose recovery from the worst of the pandemic was already being buffeted by Omicron, supply bottlenecks, and rising inflation,’ it says. ‘A fortnight into the invasion, gas and oil prices peaked over 200 and 50% above their end-2021 levels respectively. Prices have since fallen back but remain well above historical averages.

‘As a net energy importer with a high degree of dependence on gas and oil to meet its energy needs, higher global energy prices will weigh heavily on a UK economy that has only just recovered its pre-pandemic level. Petrol prices are already up a fifth since our October forecast and household energy bills are set to jump by 54% in April.’

The OBR predicts that if wholesale energy prices remain as high as markets expect, energy bills are set to rise around another 40% in October, pushing inflation to a 40-year high of 8.7% in the fourth quarter of 2022.

As it points out: ‘Higher inflation will erode real incomes and consumption, cutting GDP growth this year from 6.0 per cent in our October forecast to 3.8 per cent. With inflation outpacing growth in nominal earnings and net taxes due to rise in April, real livings standards are set to fall by 2.2 per cent in 2022-23 – the largest financial year fall on record – and not recover their pre-pandemic level until 2024-25.’

Compound interest

It is imperative individuals save and invest where they can and as much as they can and as early as they can. As Dan Brocklebank, director UK, Orbis Investments has recently highlighted, the majority of people underestimate the power of compounding interest. Orbis carried out research asking folk if they invested £100 on a child’s behalf into the stock market via a Junior ISA, assuming 8% return pa what would they have when the child hit 18. Only 6.6% were able to calculate near the correct amount of £400. The average ‘guesstimate’ was £246. This shows a clear need for financial service providers to educate clients – and potential clients – about the power of compounding over longer terms.

Dan said: “Compound growth may not be intuitive to most. As long as people underestimate the power of compounding, they are likely to miss out on the long-term benefits of investing in markets.  Investing in global equities has been shown to outperform cash over the long term, and the ‘magic’ of compounding plays a part in this.”

The award is particularly appreciated as it is voted for exclusively by financial journalists.

In presenting the award, the judges said: “Congratulations to Quill PR, which returns to claim the title that it held in 2017 and then again in 2018. As with all our PR and communications awards, it was the financial journalist community that had the final say in determining boutique PR agency Quill PR as the winner, with the outcome decided by an extensive poll carried out in April 2021.”

The judgement advised that recognition was given to Quill PR as a “longstanding and quality agency, with a diverse client base”. In the initial round of judging, the agency was complimented on providing “good examples of strong relationship building during lockdown”, with praise for their client wins during a difficult year.

The judges concluded: “Quill PR scoops this award for its work for both new and existing clients across the year.”

Sam Emery, managing director of Quill said: “We are delighted to win this award, especially as it is voted for by the press with whom we work so closely. 2020 and 2021 could have proved overwhelming in more ways than one. However, the Quill PR team more than punched above its weight, remaining a go-to source for press seeking quality comments and interviews and also as a trusted partner to our clients.”

Quill PR is pleased to announce a new member to the team, with the hire of Stephanie Spicer as Head of Content.

Steph has worked as a personal finance and investment journalist for over 20 years. She has held senior editorial positions on various industry titles. These include Money Management, Investment Week, Cover and Corporate Adviser. Most recently she has freelanced for What Investment Magazine and What Investment online. She has also acted as a PR consultant for the best part of two decades.

Sam Emery, Quill Managing Director, said: “We are delighted to have Steph on board. Her role is to continue developing the content writing service Quill offers to clients. As our client base grows so does the need to fulfil clients’ requirements for quality copy and get clients’ messages out to their relevant audiences.”