Henley Business School Position and Prospects - Alumni Masterclass 2017 - Amazon S3
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Henley Business School
Position and Prospects
Alumni Masterclass
2017
1
Henley Business School
Henley empowers individuals to become great professionals and
outstanding business leaders who think with clarity and act with
confidence and conviction.
Our strength lies in our approach. We enable people to better
understand themselves and their responsibilities while at the same
time blending the practice and theories of successful business.
An engaging, focused and distinctive business school
Being a truly international business Our sense of community and
school responsibility
The excellence of our learning
The strength of our networks
experience
The breadth and depth of our
World-class research and thinking
relationships with industry
2
Henley Brand Positioning
Engaging Business
Teaching & Executive
Research Centres
Learning Education
Subscription Based Ctrs
Custom programmes Henley Partnership
Professional conferences
Professional Accreditation Open Programmes
Collaborative events
Guest Speakers/site visits Customer Programmes
Alumni
Events
Engagement Engaging Business Series: Careers
Events (including Keynotes, Breakfast Careers Fairs
Webinars) Seminars, Spotlights Involvement in workshops
Master classes Journalist Day
Sponsorship/Funding
3
Rankings
Accreditation Rankings
• Triple Accredited • Full-Time MBA: #27
o Under 100 of the world’s
• Exec MBA: #47
16,500 Bus Schools
• Exec Ed: #20
• Master in Finance: #40
• Complete UG
o Acc & Fin: 14
o Bus & Man: #28
Good but not yet great o Land Man: #1
4
Teaching, Research and Industry
Research: REF and Industry
REF – Bus & Mgmt (135 entries) Industry impact
#16 for GPA (up 30) • ESRC on Finance History -
£800,000
#10 for Impact
• Newton Fund for Energy -
Art and Design: History,
£750,000
100% Practice and Theory :
Typograph
90%
80% Improved
Education
Business & Management
Studies
Architecture, Built
Geography,
Environment
Studies
Environmental
Agriculture, Veterinary
& Planning&
& Archaeology:
Food Science
• Cabinet Office: reputation
Classics Archaeolog
Earth Systems &
70% Overall
Politics and International Environmental Sciences
2014 REF%
• Deloitte: Tax and Ethics
Studie Psychology, Psychiatry &
60% History Modern Languages
Neuroscience
English Dance
Music, Drama, Language
andand
Allied Health
Mathematical Professions,
Sciences Law
ArtLiterature
and Design: History,
50% Performing Arts
Dentistry, Nursing & Practice and Theory : Ar
Pharmac
40%
Geography,
Biological SciencesEnvironmental
30% Electrical and Electronic
Studies & Archaeology:
Engineering, Metallurgy
Geograph Philosophy
20% and Material
Chemistry
10% Declined
0%
0% 20% 40% 60% 80% 100%
2004 REF
6
Excellent research and thinking
• Henley’s research has always had a strong focus
on policy and practice, as well as pure theory
• Our research centres profile our key themes
John Dunning Centre for Henley Centre for Customer
International Business Management
Informatics Research Centre Centre for Intelligent Places
John Madejski Centre for Henley Centre for
Reputation Entrepreneurship
Centre for International Business Henley Centre for Engaging
History Leadership
The ICMA Centre Centre for Euro-Asian Studies
7
Teaching and Industry
• Innovation in teaching
o Started British management education
o First distance learning MBA in the world
• Professional contacts
o Individuals with industry experience
o Connections with over 25 professional bodies
o BSc Accounting with PwC; Huawei Academy
• Corporate Qualifications
o Financial Conduct Authority
• MSc Financial Regulation
o Deutsche Telekom, ING, Roche
• MSc Strategic Marketing
8
Research programmes
Phd Programme DBA Programme
Selective Aimed at Practitioners
c 200 registered c 100 registered
Good completion AMBA accreditation
rates Strong alumni
9
International
Henley South Africa
• “We build the people who build the businesses that build
Africa.”
• The only foreign business school in South Africa
• Over 1,000 students on site in January
• Mission to become
“Henley Africa”
• MBAid initiative
• 60% of Henley MBA
students registered in
ZA
11Henley International
• International Partner Network (IPN)
o Subsidiaries
• Finland, Germany, South Africa
o Partners
• Beijing Institute of Technology (BIT) – BSc Accounting
• Rotman (U of Toronto) – DBA
• Venice – BSc in Finance
• Ghana - MSc Informatics
• Denmark, Malta – MBA
• Closed/Terminated:
o Henley Hong Kong (after 35 years) and Trinidad
• University of Reading in Malaysia (Johor)
12The Henley Alumni Community
• Ranked #1 for potential to network and breadth of alumni network
• Masterclasses, events, and special interest groups (LinkedIn: 7,500)
• Alumni associations in more than 15 countries
• Alumni provide mentoring, advice, support for recruitment and funding
• 60% of Alumni are in mid/senior positions
13Administrative Staff College of India
• Based on Henley
• Founded 1953
• Hyderabad
• Still a key Civil Service
academy in India
• Describes itself as
o The only bar with a management college attached.
14Issues and Summary
A trusted relationship
Aligned identities
Shared ambitions
Different markets
Henley is an excellent business school and
a significant asset of UoR
16Changing Markets Insert footer on Slide Master www.henley.ac.uk
• European Regulation
o Trading size and speed
• Technology
• Scandals and Reputation
o LIBOR
• People
o Knowledge and the Levy
• Environment
o BREXIT
18Regulation
MiFID II
• Markets in Financial Instruments Directive 2
o In effect from 3 Jan 2018
• Fund managers must explicitly pay for research
separately from trading fees
o Arguably increases transparency by hurts smaller firms
• Much stricter “Best Execution” rules to reassure traders
that they have got a good price
o But volume of reporting is very large!
• Block Trading
20Block Trading
• How does a big institution trade a large block of shares
without obtaining a damaging price?
o Been a major regulatory question for decades
• London used to be the centre of institutional trading
with its “upstairs market” and trade reporting delays
• Arrival of electronic platforms made this untenable
o Either large trades are automatically cut up
o Or trade off-exchange in “dark pools”
• Dark Pools
o Dark Pools share was 2% in 2010 and 9% in 2016
o The LSE’s own dark pool is Turquoise-Plato executed £550m in
July 2016 and £1.75bn in Feb 2017
21Block Trades
• MiFID forces reporting even in dark-pools
o “Double cap” to prevent reliance on off-exchange (If more than
4% of trading in any stock on a dark-pool, or 8% across pools,
then trade off exchange is prohibited for 6 months
% of trading above 8% on Dark-Pools
STOXX 50 45
CAC 40 49
MDAX 57
ISEQ 73
OMX 530 76
FTSE 250 83
FTSE 100 95
0 20 40 60 80 100
22Block Trades
• Regulatory arbitrage already led to “innovation” EG
o “Periodic Auctions” in which orders are given at “indicative”
prices and are matched by volume and executed at “best” price
• Since the bid price IS public, this is not a dark pool (even
though executed price isn’t)
• Periodic may be “many times per second”
o “Indication of Interest” platform allows pre-trade matching but
execution is then public.
23Equity trade size shrinking
• In FTSE 100 stocks the average trade size
o in 2002 it was £60,000
o in 2012 it was £6,500
o In 2017 it is £4,750
• Consequence of High Frequency Trading (HFT) provision
of market liquidity versus traditional OTC dealer
provision
• AND difficulty of executing block trades
24High Frequency
• Traders realise that
o “cutting up” big trades gains value
o Very quick trading is itself profitable
o Trades now execute 1/100,000 seconds
• Trades executed direct to exchange
o Regulation cannot keep up
o “Flash Crash”
• Attempts to control it by trading limits
o Resisted by those seeking “fair” profits from exploiting
innovative technology
• 50% of US trading is High Speed
25Execution speed
• How fast can I trade?
Round-Trip Latency (milliseconds)
8.8
8.6
8.4
8.2
8
7.8
7.6
2012 2013 2014 2015 2016
Actual Theoretical Minimum
• Is it worth it?
o Cost of connection between Illinois-NewJersey is $2m/annum
26Why is this necessary
• Is this:
o Good Business
o Pointless
o A rip-off
o Damaging to the market
o A cause for regulatory concern
• Is it insider trading
o Who owns the order flow?
• Last year’s news – “the market has peaked and focus is
now on strategy not speed”
27Is this new
• Rothschild made their money with pigeons at Waterloo
• 2017 it is all in Basildon and Slough
28Technology
Examples
• Trader fined £37,000 for using WhatsApp at work
o DB has banned apps from work phones
o GS has capped private phone bills after people switched to own
phone use!
• Blockchain (core of bitcoin) being tried to settle oil
trading to avoid costs and delay of the traditional
contracts/letters of credit/inspection regime
• Quantopian – crowdsourced algorithmic trading hedge
fund
30On the other hand
• The London Metals Exchange is the largest market in
metals
o Still open outcry
o “unusual” rules
o Bums on seats
• New premises
in 2016
• Plenty of phone/online trading but ring price is key
• Established above a hat shop in Lombard Court in 1877.
31Stephen Ross
• Died 2017
• “Arbitrage Pricing”
o Basis for much financial
innovation
o Equity / hedge funds
o Option pricing
• ”If I can copy it, I can value it”
32LIBOR / Behaviour
33Corruption: Libor
• London Inter Bank Offer Rate
o Used as the “reference” interest rate for 100 years
o Set by “agreement”
• Was the market rigged?
• Settlements:
o ICAP $87m
o Barclays $450m
o RBS $615m
o Rabobank $1,000m
o UBS $1,500m
• So how much did they make from this?
o And for how long
34LIBOR
• Latest twist is allegation that Bank of England pressured
Barclays (and others) to rig LIBOR
• Fines to date £7.5bn
o Barclays fined £350m; Bob Diamond resigned; 4 traders
imprisoned
• ICE (which owns Liffe) also owns LIBOR
o Bought for £1 from BBA after scandal
o New measure based on actual trade information
• 4.5million data points per day
• Algorithm is based on trading which is based on algorithms!
• CEO “Need humans when the machine goes nuts”
35The Professionals
• Bob Diamond
• “One of the most thoughtful and
intelligent bankers”
• Resigned (again) after LIBOR scandal
• Rebuilding reputation:
“incredible entrepreneurial opportunity”
to invest in financial companies competing
with so-called systemically important banks
that are facing increasing scrutiny from regulators.”
• Now owns historic London stockbroker Panmure-Gordon
which is now very active on AIM.
36People
37Buyers of Financial Products
• FT Survey of 18-35 year olds
• 17% did not know their tax band
• 25% unsure whether they were in a pension scheme
• 38% think Lifetime ISA better than Pension
o In spite of better tax regime and employer contributions
o “Mis-selling risks written all over this” Ros Altman
• 56% did not know what compound interest is
• “Those Hargreaves Landsdown people will tell me what
to invest in, won’t they?”
38Professional Competence
• Been questioned for decades (not just financial services)
o GS cut training to $100 employee/annum
• Apprenticeship Levy – Truly Disruptive
o Mandatory “Use or lose” training budget as from 1 April 2017
o Levy set at 0.5% of Payroll – approx. £2.4bn by 2018
o Affects over 2,000 private and public sector entities
• Programmes at all levels in-work to employees
o To industry approved “standards”
• Estimates are for 2,000 standards and 3m participants
o By Registered Providers
• Already approved:
o Chartered Manager (levels 5, 6 & 7)
o To be approved: Accounting (level 7), Financial Services (level 6) 39Environment
Brexit
• Changes everything
o Or not
• Individual positions are non-negotiable
o Discussion is difficult
• “We have had enough of experts”
o How many people actually know what “WTO rules” are?
• LSE / Deutsche Börse merger failed
o Very close to Article 50
o “Difficult to do cross-border business when there are strong
nationalistic undertones”
o Carsten Kengeter (CEO of DB) is under investigation for insider
trading related to deal
41Brexit
• Will Slough and Basildon save the UK?
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