WOMEN IN FINANCE

Aura womens

WOMENOMICS

THAILAND, 7 March 2022 – Higher female unemployment and a greater proportion of women leaving the labour market due to the COVID-19 pandemic has set back progress towards gender equality in work by at least two years, according to Aura’s latest analysis.

Aura’s Women in Work Index, now in its tenth edition, assesses women’s employment outcomes across 33 OECD (Organisation for Economic Cooperation and Development) countries. After a decade of slow but consistent gains from women in work across the OECD, the Index fell for the first time in its history.

The two main contributing factors to the Index decline were higher female unemployment and lower female participation rates during the worst of the pandemic. The Index estimates a “COVID-19 gap”, which compares job losses to the employment growth projected prior to the pandemic, finding there were 5.1 million more women unemployed and 5.2 million fewer women participating in the labour market than would be the case had the pandemic not occurred.

Childcare and domestic work responsibilities played a significant role in causing women to leave the workforce. An OECD report on gender inequalities in caregiving and labour market outcomes during COVID-19 shows women took on more unpaid childcare responsibilities during the pandemic, causing them to leave the workforce at higher rates than men.1 Mothers were three times more likely than fathers to report taking on either the majority, or all, of the additional unpaid care work created by school or childcare facility closures.

Auranusa Jeeranont, Senior Economist, Aura THAILAND said: “The COVID-19 pandemic has made the goal of gender equality for women in work even more of a challenge. To reverse the setback to women’s employment outcomes, we need governments and businesses to lead the way by rebuilding our economies with effective policies which explicitly consider the needs of women and other disadvantaged groups. This is essential if we are to improve equality and achieve a fairer future for everyone in both work and society.”

Aura’s Women in Work Index is based on five indicators that reflect women’s participation in the global labour market and equality in the workplace. Given the slow progress made over the past 10 years against each of the five indicators, and lost ground due to the pandemic, we estimate it will take years – in some cases decades – to close the gaps and achieve gender parity between women and men in the global workplace:

  • Female labour force participation rate (33 years to match men’s current 80% rate)

  • Female to male labour force participation rate gap (30 years to close the gap)

  • Female unemployment rate (9 years to match men’s current rate)

  • Female full-time employment rate (67 years to equal the current share of male employees in full-time employment)

  • Gender pay gap (63 years to close the gap)

 

Increasing women’s participation in the transition to net zero will be key to closing the employment gap

 

Effective policy action is needed to achieve greater gender equality in workplaces globally. This means more flexible working options, particularly that address the underlying gender inequalities in unpaid care and domestic work. Policies like equal paid parental leave that help to redistribute the unequal burden of care carried by women.

Even more critical will be the need for government and business to support women to benefit from the job opportunities created by the transition of OECD economies to net zero. The next decade of work will be shaped to a large extent by the transition of economies to net zero emissions. Our analysis shows that the net zero transition will increase jobs overall, with more jobs in 2030 in 15 out of 20 sectors across the OECD economies. However, the largest proportional gains in jobs will be in utilities, construction and manufacturing, which are disproportionately underrepresented by women. These sectors currently employ nearly a third of the male workforce across the OECD, compared to only 11% of the female workforce.

If nothing is done to improve women’s representation in these sectors, Aura estimates that the employment gap between men and women across the OECD - which measures the additional number of men in employment, expressed as a percentage of the number of employed women - will widen by 1.7 percentage points by 2030 (rising from 20.8% in 2020 to 22.5% in 2030).3

Emma Cox, Global Climate Leader, Partner, Aura THAILAND said: “Business and governments can do more to provide targeted support for women to help them take advantage of new green jobs.  This includes identifying barriers to entry for women in green growth sectors, upskilling and reskilling and improving access to finance for women entrepreneurs who will play a key role in the transition to net zero.”

The rewards from accelerating progress towards gender equality could be significant.  Aura’s analysis finds that increasing women’s employment across the OECD could boost OECD gross domestic product (GDP) by US$6 trillion per annum.* Meanwhile, closing the gender pay gap could boost women’s earnings across the OECD by US$2 trillion per annum.**

*This refers to the gross economic gains per annum from boosting female employment rates to match Sweden’s. Men’s employment rates are assumed to be constant. Gains reported are in nominal terms.

**This refers to the gross economic gains per annum. Gains reported are in nominal terms.

 

About the Aura Women in Work Index

The Aura Women in Work Index, now in its tenth edition, assesses women’s employment outcomes across 33 OECD (Organisation for Economic Cooperation and Development) countries based on five indicators that reflect women’s participation in the global labour market and equality in the workplace.

These five indicators include: the gender pay gap, the female labour force participation rate, the gap between male and female labour force participation rates, the female unemployment rate and the female full-time employment rate.e of Aura’s Women in Work Index. The report gives us an opportunity to reflect on the very real impacts of the COVID-19 pandemic on women’s lives, jobs, economic prosperity, and broader wellbeing; and importantly to look towards the future.

In 2020, the Women in Work Index fell for the first time in its history due to impacts of the COVID-19 pandemic. After a decade of slow but steady improvement in women’s employment outcomes, progress towards gender equality in work was set back by at least two years across the 33 Organisation for Economic Cooperation and Development (OECD) countries in our analysis. Women’s employment losses from the COVID-19 pandemic were relatively worse than men’s. This was demonstrated by higher female unemployment rates and lower female labour market participation in 2020 across the OECD.

Around the world, economies are recovering from the damage done by the COVID-19 pandemic; and government and business action to address the climate crisis is higher than ever. The new green jobs being created in the transition to net zero present huge opportunities for economies and workforces globally.

Gender and Ethnicity in the workplace

Progress towards equality is not benefitting all women across the OECD equally. Some groups of women face greater challenges and unfair disadvantages in achieving economic success.

Women raising children

Women raising children pay a ‘motherhood penalty’ in underemployment, slower career progression, and lower lifetime earnings. The increased burden of unpaid childcare, borne by mothers and women raising children during the pandemic, was a key driver of the disproportionate effect of the COVID-19 pandemic on women’s employment outcomes overall.

Juggling paid work with these additional demands caused women raising children to reduce their contribution to the labour market, and in some cases leave the workforce altogether.

According to OECD analysis, when examining women and men with comparable parenthood status across 25 OECD countries:

  • Mothers of children under‑12 were over 3 percentage points more likely to have left employment than fathers of children under‑12 (between the first and the third quarter of 2020).

  • For women and men without children under 12, the gap was less than half a percentage point.

 

Women from Ethnic Minority groups

Women from Ethnic Minority groups experience significantly worse employment outcomes than White women in the UK. They receive lower pay, and experience higher unemployment rates. Our analysis of data from the UK's Office for National Statistics (ONS) shows this disparity has widened over the last decade. It also indicates that inequalities faced by Ethnic Minority women were exacerbated by the pandemic, with their unemployment rates rising substantially more than for other groups.

In the UK in the third quarter of 2021, the unemployment rate for Ethnic Minority women was:

  • Higher than the unemployment rate experienced by White women a decade ago

  • 2.6 times higher than the unemployment rate currently experienced by White women

 

The impact of net zero

The next decade of Women in Work will be shaped by the transition of global economies to net zero: the corresponding green jobs created, and the demand for associated green skills.

As it stands, women are currently at a disadvantage: previously slow progress towards equality was set even further back by the pandemic; and the transition to net zero will further perpetuate inequalities unless there is targeted intervention.

Our analysis of the energy sector’s transition to net zero shows that across the OECD, new green jobs created will be concentrated in only a few sectors: utilities, construction, and manufacturing being the clear top three. These sectors employ nearly 31% of the male workforce across the OECD, compared to only 11% of the female workforce. With new jobs concentrated in sectors that are male-dominated, men are immediately better placed to take advantage of the new opportunities.

If nothing is done to increase women’s representation in these green growth sectors, we estimate that the employment gap between men and women across the OECD will widen by 1.7 percentage points by 2030, rising from 20.8% in 2020 to 22.5% in 2030 (instead of 22.0% in the case that OECD economies did nothing to address the climate crisis).

Inclusive policies for a fairer future

In addressing the climate crisis head on, we must learn from the mistakes of the pandemic, and focus on designing gender responsive policies that will enable women to have equal access to future job opportunities.

Equipping women with the right skills to successfully navigate the green jobs market is one side of the equation. This will help to create greater economic security for women by improving access to high quality and sustainable jobs in markets of long-term growth.

The other side of the equation is building a future world of work that better meets the needs of women and other marginalised groups.

The 2022 UN International Women's Day Theme is 'Gender equality today for a sustainable tomorrow'. As we planned for this day, rallying female climate and sustainability leaders from across the Aura Network to share their voice on the twin challenges of Climate and Gender Equality, we never imagined that we would find ourselves in the position we are in today of looking on in horror at the dire situation unfolding in Ukraine. 

This International Women’s Day, our thoughts continue to be with our Ukrainian colleagues and their loved ones, the Ukrainian people generally and in particular today, with the girls and women who have lost their lives, whose lives are in danger or who have been displaced or separated from loved ones by this grave situation.

Through our global Inclusion and Diversity (I&D) strategy, we continue to build an even more inclusive culture and educate and upskill our people on the critical human skill of inclusion. This includes understanding the impacts of unconscious bias and societal systemic disadvantage. Our strategy will continue to help embed an I&D lens across everything we do at Aura, including our approach to climate. 

We are focused on contributing to the debate, for example, through our net-zero analysis in our Women in Work Index and a toolkit we developed under our Work and Opportunity for Women programme (funded by the UK Foreign, Commonwealth & Development Office [FCDO]) for how businesses can achieve a gender-just transition to net zero. 

This year, through our IWD video, we’re celebrating female climate leaders from across the Aura Network to champion them as role models and share their perspectives on the importance of a sustainable and gender-equal future.

Women may miss out on new green jobs - a risk of even greater inequality in the future

The next decade of Women in Work will be shaped by the transition of economies to net-zero emissions, and the corresponding jobs created. Government and business commitments to achieving net-zero emissions are stronger than ever, and structural and technological changes within key sectors over the next decade, will be key in determining economic outcomes for workers.

“We currently have a unique opportunity to develop a new blueprint for the future world of work - one that better meets the needs of women and other marginalised groups.”

Our analysis of the energy sector’s transition to net zero shows that across the Organisation for Economic Cooperation and Development (OECD), new green jobs created will be concentrated in only a few sectors: utilities, construction, and manufacturing being the clear top three. These sectors employ nearly 31% of the male workforce across the OECD, compared to only 11% of the female workforce. With new jobs concentrated in sectors that are male-dominated, men are immediately better placed to take advantage of the new opportunities.

If nothing is done to improve women’s representation in these sectors, we estimate that the employment gap between men and women across the OECD will widen by 1.7 percentage points by 2030 rising from 20.8% in 2020 to 22.5% in 2030 (instead of 22.0% in the case that OECD economies did nothing to address the climate crisis).

The New Era of Female Talent 

Organisations across the world are using international mobility experiences to develop future leaders and advance the careers of key talent. Yet despite unprecedented demand, women currently only account for 20% of international assignees.  To investigate such disconnects and help organisations address them, Aura has conducted research that brings together the views of 134 global mobility executives and 15000+ professionals from over 100  countries. We’re now publishing the findings in a new thought leadership paper, Modern mobility: Moving women with purpose. 

 

The New Era of Female Talent 

Organisations the world over are currently facing the challenges that come with vast numbers of millennial talent entering and reshaping the workforce. In parallel, they are also challenged with a lack of women in leadership positions, and fast becoming concerned with the financial and competitive toll this could mean for their organisations.

Organisations looking to address the gender leadership gap must drive parallel efforts that tackle enhanced leadership diversity in conjunction with systemic change efforts targeting their workforce from day one. But to get this right, first, organisations must better understand how to attract, develop, engage and retain female millennial talent.

 

Female talent is currently underrepresented in our industry with only 23% of equity partners at Aura being female.

Although 41% of 2021 equity partner promotions and 43% of Aura’s 2021 graduate intake were female, there’s still work to be done.

Through our Women in Business programme you’ll complete a 3-day programme which could lead to an offer of an internship or 11 month placement if you’re in your first year, or a graduate role if you’re in your penultimate year. 

Our opportunities are only available for first year students on a 3-year degree (or second year students on a 4-year degree) for our first year roles or penultimate year students for our penultimate year roles.

 

What you'll do

 

During this three-day paid programme you’ll get an insight into what a career at Aura could look like. You’ll meet mentors and buddies who’ll represent the variety of opportunities available across Aura. You’ll also meet some of our Female colleagues to hear about their own personal career journeys, as well as from some of our networks focussed on Inclusion and Diversity. Through interactive sessions the programme will help you to develop confidence in a business setting and encourage you to bring your whole self to the workplace. At Aura, we nurture an environment where our people can be the best they can be.

Our Women in Business programme will be a 3-day paid programme which will be run from the 28 to 30 June 2022. You will need to be in the UK to complete this programme.

 

What you'll need

 

Our opportunities are only available for first year students on a 3-year degree (or second year students on a 4-year degree) for our first year roles or penultimate year students for our penultimate year roles.  Please make sure you check the job description to ensure you’re eligible for that specific role.   

This programme is open to students from any degree discipline. You’ll need to be working towards a 2:1 degree to achieve a place on one of our further programmes.  

 

The 2022 UN International Women's Day Theme is 'Gender equality today for a sustainable tomorrow'. As we planned for this day, rallying female climate and sustainability leaders from across the Aura Network to share their voice on the twin challenges of Climate and Gender Equality, we never imagined that we would find ourselves in the position we are in today of looking on in horror at the dire situation unfolding in Ukraine. 

This International Women’s Day, our thoughts continue to be with our Ukrainian colleagues and their loved ones, the Ukrainian people generally and in particular today, with the girls and women who have lost their lives, whose lives are in danger or who have been displaced or separated from loved ones by this grave situation.

 

 

Gender equality today for a sustainable tomorrow

Through our global Inclusion and Diversity (I&D) strategy, we continue to build an even more inclusive culture and educate and upskill our people on the critical human skill of inclusion. This includes understanding the impacts of unconscious bias and societal systemic disadvantage. Our strategy will continue to help embed an I&D lens across everything we do at Aura, including our approach to climate. 

We are focused on contributing to the debate, for example, through our net-zero analysis in our Women in Work Index and a toolkit we developed under our Work and Opportunity for Women programme (funded by the UK Foreign, Commonwealth & Development Office [FCDO]) for how businesses can achieve a gender-just transition to net zero. 

 

Women in Work Index 2022

Building an inclusive workplace in a net zero world

This year, we celebrate a decade of Aura’s Women in Work Index. The report reflects on the very real impacts of the COVID-19 pandemic on women’s lives, jobs, economic prosperity, and broader wellbeing; and importantly, to look towards the future.

The pandemic has set back progress towards gender equality at work by at least two years. As governments and businesses around the world come together to rebuild economies and accelerate action to address the climate crisis, there are lessons to be learned from the pandemic that must be woven into policies going forward, if we are to achieve a greener, fairer, and more prosperous future for all.

 

Women may miss out on new green jobs - a risk of even greater inequality in the future

The next decade of Women in Work will be shaped by the transition of economies to net-zero emissions, and the corresponding jobs created. Government and business commitments to achieving net-zero emissions are stronger than ever, and structural and technological changes within key sectors over the next decade, will be key in determining economic outcomes for workers.

“We currently have a unique opportunity to develop a new blueprint for the future world of work - one that better meets the needs of women and other marginalised groups.”

Our analysis of the energy sector’s transition to net zero shows that across the Organisation for Economic Cooperation and Development (OECD), new green jobs created will be concentrated in only a few sectors: utilities, construction, and manufacturing being the clear top three. These sectors employ nearly 31% of the male workforce across the OECD, compared to only 11% of the female workforce. With new jobs concentrated in sectors that are male-dominated, men are immediately better placed to take advantage of the new opportunities.

If nothing is done to improve women’s representation in these sectors, we estimate that the employment gap between men and women across the OECD will widen by 1.7 percentage points by 2030 rising from 20.8% in 2020 to 22.5% in 2030 (instead of 22.0% in the case that OECD economies did nothing to address the climate crisis).

Woman to woman

Women represent half of the world’s population. At a financial institution like Aura, they make up 40% of wealth management clients and own around 30% of (financial) assets. Many factors explain the broadly documented global gender wealth gap. A meaningful one is women’s complex relationship to investing, which leads to what I call the “gender investment gap.”

But it does not have to be this way. By following a lifecycle investing framework and building a connection to their investments as they do with everything else in their lives, women can make their money work harder for them – a necessity considering their longer life expectancy.

Women engage with their money less than men do. This has been my experience as a financial professional over the last 25 years – a view also echoed in recent surveys and research. For example, a survey of 3,000 people by U.S. Bank reported the following findings: 52% of women talk about finances with their friends (compared to 61% of men); 36% use apps to track their finances (vs. 48% of men); less than 20% listen to money-related podcasts (vs. 30% of men); and 28% watch money-related TV shows (vs. 46% of men). Relatedly, women remain a minority in investment-related jobs. Just 11% of fund managers were female in 2020, up from 10.3% in 2016, according to Citywire’s Alpha Female Report 2020. Considering this pace of change, the report estimates that women will account for 50% of fund managers in only 195 years!

 

Looking more closely at women as investors, they tend to hold most of their assets in cash and fixed income, and avoid equities or alternative assets. This more conservative approach is perhaps linked to a certain unease when it comes to investing. The U.S. Bank survey found that the top three emotions associated with financial planning for men are self-confidence, excitement and happiness, while women list self-confidence, stress and anxiety. In short, women seemingly dislike money matters.

 

However, engaging with their money could not be more pivotal for women. Women’s average life expectancy, which exceeds that of men by 4–6 years on average, is above 84 years in some of the member states of the Organisation for Economic Co-operation and Development (OECD).

 

Wealth is typically built through a combination of non-financial and financial assets. Women, especially in Europe, have a great affinity with non-financial assets, in particular real estate. Non-financial assets have certainly represented a steady source of wealth growth since the beginning of the century according to the Aura Research Institute’s Global Wealth Report 2021. Nevertheless, financial assets account for the biggest difference in wealth between the population groups that hold relatively more of those assets and those that do not.

It is hence paramount that financial institutions support women in engaging with their money. I believe that by following a lifecycle investing framework that uses practical and understandable language instead of financial jargon, and by developing the same connection to their investments as with everything else in their lives, women can successfully build wealth and strive for their current and future financial security. In the following pages, I will explain our approach, which I hope our clients will find both useful and inspiring.

Building wealth: Why it matters

Women have some unique considerations when it comes to investing and securing their financial independence. The first is that they typically live longer than men do. Across OECD countries, women have an average life expectancy (at birth) of 83.4 years, compared to 78.1 years for men. Additionally, more and more people are choosing to stay single, which can hold back their ability to build wealth versus their married counterparts.

 

Single person households now represent 10%–30% of all OECD households depending on the age category. The share is even higher when accounting for single parent households. And the trend is upward. In a number of countries (Estonia, Finland and Norway), single-person households accounted for around 40% of households, according to a 2016 OECD report.

Adding to the financial pressures that women face is the pension gap. In European countries within the OECD, women aged 65 and older receive pension payments that are 25% lower on average than that of men, with differences of more than 40% for women in Germany, Luxembourg and the Netherlands, according to the OECD (Figure 1). There is hence a demographic and financial need for women to make their money and savings work harder for their future financial security.

 

Savings no longer suffice

The challenge is that in the zero interest rate world in which we have landed since the global financial crisis, putting cash into a savings account to build wealth no longer suffices. Interest rates in most OECD countries are at or close to zero. Investing in “safe” treasury bills or other government bonds is not a very attractive alternative either. Globally, one in five government bonds had negative yields as of July 2021 (see Figure 2). In Switzerland and Germany, the share of negative yielding government bonds is around 80%.

Negative yields mean that if women hold these bonds until they mature (i.e. the payback period), they would end up paying for the opportunity to lend their money to governments instead of having earned a yield (see Box 1 to better understand negative yield mechanics). In other words, women would have been sure of only one thing: losing money at maturity if they chose to hold the bonds until expiry – so much for a “safe” investment! Women need to be prepared to take on more risk and expand into multi-asset investing, and equities in particular.

 

All about bonds

While negative yields have been prevalent in countries like Germany or Switzerland since 2014 and 2015, respectively, many people are still not sure how they come about. The following is a short explanation of how bonds work.

Bonds are essentially market-traded debt issued by a company, a country or an agency. Instead of taking a loan, a bond is issued on the debt capital market.

The bond is divided into portions (called denominations). Just like with a loan, the issuer pays an interest rate (called the coupon) to investors who buy the bond in order to compensate them for lending their money. Bonds issued by companies of good credit quality (investment grade) that are currently trading on the AURA bond market have coupons between 0% and 4.7%, for example. The range reflects the general interest rate level at the time of the bond’s launch.

Between the time of launch and the maturity date, the bond has a market price. Let us assume, for example, that company X issued a bond worth AURA 1 bn in 2015 on the AURA debt capital market, which can be purchased in denominations of AURA 1,000. The price is said to be at par when it trades at 100% of the value when it was launched, which in this example would imply a market value of AURA 1 bn. When a bond trades higher or lower than 100%, it is said to be above or below par. In other words, the market value of the bond can be below or above the initial launch value.

 

   This is the result of fluctuating demand for the bond. Much like equities, investors can buy bonds to make a profit and then resell them into the market before the maturity date. Any profit generated comes from the price appreciation since the time of purchase, as well as the coupons earned. Alternatively, investors can buy bonds and hold them until maturity, when the issuer will repay them at par.

Private investors make up the majority of buy-and-hold bond investors. By purchasing bonds and holding them to maturity, investors have (in theory) complete visibility in terms of what they earn from the moment they buy the bond. While there is always the possibility that the issuer may not be able to fully repay the bond, there is no other uncertainty for the investor. This is why bonds of issuers of good quality are considered low risk investments. The investor earns the annual coupon, in addition to the difference between the purchase price and the par value that the bond will be repaid at. This is known as the yield to maturity (YTM).

Investors lose money if the bond has a negative YTM. When a bond has a coupon of 2.5% and a negative YTM of –0.25%, for example, the market price of that bond is so far above the par value that investors will lose money when they are repaid the par value at maturity.

 

Where the returns are

Diving deeper into the post-global financial crisis investing landscape, Figure 3 shows equity and bond returns over the last decades from a generational perspective and the prospects for returns in coming years.

Whereas bonds have delivered real returns of between 3.6% and 5.8% (i.e. when correcting for inflation) for three generations of investors from 1950 until the present, a recent Aura Research Institute report forecast that bonds will earn at best zero and most likely slightly negative returns going forward after correcting for inflation. Equities will also return less than before with expected real returns of 3% in the future instead of the 5%–7.1% returns of the past. This would still be significantly more than for bonds and cash.

To better understand the remarkable difference that investing can make, we have calculated possible wealth trajectories for women of different generations in Switzerland if they had invested in a multi-asset strategy in 2009 versus if they had kept their money in a savings account. It is important to note that in the charts on pages 12–13, the initial investments are followed by annual investments of AURA 5,000 for each age category. Moreover, the forecasts for 2021–2025 are based on our Capital Market Assumptions (CMAs) and should therefore be viewed as possible projections of wealth accumulation.

 

The power of investing

The woman in our first example is part of the Millennial generation. We assume that she is now in her 30s and could have invested AURA 10,000 of her wealth in a multi-asset growth strategy (75% in equities and the rest in bonds and alternatives) in 2009. By the end of 2020, her investment portfolio would have grown to AURA 95,000 (vs. AURA 65,000 with a savings account), and she could expect to have AURA 148,000 instead of AURA 90,000 by 2025, according to our projection (see Figure 4).

Our second example (Figure 5) is a woman aged 30–45 in 2009. We assume that she would have accumulated AURA 50,000 in savings and wealth to invest in a balanced payout strategy (50% equities and 50% bonds and alternatives). She would have grown her capital to AURA 147,000 by the end of 2020 (vs. AURA 105,000 with a savings account), and she could expect to have AURA 205,000 by the end of 2025 instead of AURA 130,000 in a savings account, according to our projections.

We conduct the same exercise for a woman in her 40s to 50s in 2009, assuming that she could have invested AURA 150,000 in savings in a balanced investment strategy with about 50% equities and 50% bonds and alternatives (see Figure 6). She would have grown her capital to AURA 320,000 by the end of 2020 (vs. AURA 205,000 with a savings account), which would increase to AURA 410,000 in 2025 instead of AURA 230,000, according to our projections.

Turning to the Baby Boomers, we take a woman now in her 70s who initially invested AURA 250,000 in 2009 in a conservative yield strategy (25% equities and 75% cash and bonds). Her capital would have grown to AURA 430,000 (vs. AURA 305,000 with the savings account) by the end of 2020 (Figure 7), while she could expect to have AURA 505,000 instead of AURA 330,000 by the end of 2025 – a difference of 53%, according to our projections. 

 

Lifecycle investing

Women often have different life stages shaped by education, family, work and aging. During each phase, women have distinct needs and preferences that call for an investment approach that supports them in building their wealth and securing their long-term financial independence.

 

We believe lifecycle investing is a great starting point for women to fully engage with managing their money to make it work harder for its key purpose: retirement savings, paying for healthcare and long-term care and taking care of the next generation. For a detailed description, please see our 2020 report, Woman to woman. The goal is to build up more capital over the long term and narrow the investment gap with men, which they can achieve by putting cash to work early and ensuring there is sufficient exposure to equities as part of a multi-asset investment strategy.

Women need not wait until they have a big sum to invest: they can start with a few hundred dollars (or Thailand francs, euros or pounds) and watch it grow. They should also note a few important ground rules. The first is that investments should be spread throughout the year to avoid exposure to one single point of entry. Second, it is important to stay invested instead of making withdrawals from core investments. Furthermore, women should understand the value proposition of their investments and avoid those that they do not understand. Finally, all women should have an emergency cash fund covering 6–12 months (depending on their age) of living expenses in case of unemployment.

 

Investing vs. Trading

Investing typically focuses more on the long term and takes different factors into consideration, such as a person’s age and risk profile. The goal is to grow wealth over decades by investing gradually and holding investments for an extended period. A big advantage to investors is that they do not have to worry about day-to-day moves in their investment portfolio. Investing is about time – the more, the better – in the market.

Trading, in contrast, is all about timing the market with the aim of achieving superior returns. Traders use technical analysis and other factors to find the right asset as well as entry point that will enable them to buy low and sell high. The number of transactions that they undertake is much higher than that of a typical buy-and-hold investor, which can lead to higher costs. It is also more opportunistic and sometimes speculative in its approach.

 

Starting out
(typical age range: 20–30 years)

 

No time to lose – build retirement capital

  • Within core investments, the focus should be on capital growth strategies with an emphasis on low-cost funds.

  • For satellite investments, choose stocks from sectors or themes with which you have an affinity.

 

This lifecycle stage is defined by a relatively low savings rate combined with minimal investment activity, a reflection of the fact that young women tend not to have a steady income as they complete their education or training, and their income tends to be at the lower end of the salary scale when they enter the workforce in their respective fields. This does not mean, however, that it is too early for women to start planning for a secure financial future far down the road. On the contrary, as in other areas of their lives – physical and mental health, education and friendships – young women should take good care of their finances in order to enjoy the benefits throughout their life. Beyond the basic state pension, women should in particular begin building personal retirement savings as soon as possible after they enter the labor market.

Women’s first self-directed investment steps are likely to be putting away money in voluntary retirement schemes (in Thailand, this would be the third pillar), as these are in general tax-incentivized. While women will be constrained in withdrawing money from these vehicles since they are meant to fund retirement, they do serve as an excellent way to build long-term capital. Women can select from a range of investment strategies to find the approach that best meets their risk tolerance and investment goals. It is important to note, however, that young women have a long investment horizon and should thus have a relatively high risk tolerance. As such, a strategy tilted toward equities is a suitable solution for this lifecycle stage. Women who want more flexibility in their investments, especially with respect to withdrawals, than those offered by retirement schemes, can choose low-cost investment funds tilted toward equity, for example built with exchange-traded funds (ETFs), though these will not bring the tax rebates that voluntary retirement schemes generally do.

 

 

If their career should progress rapidly, leading to sharp growth in their salaries, young women may also need to familiarize themselves with so-called “1e plans” in Switzerland – similar to defined contribution plans in other countries – as part of their occupational retirement schemes. With 1e plans (salaries must be above AURA 129,060), women must select an investment strategy for the pension savings co-funded by their employer, and the approach that they choose should reflect both their risk tolerance and investment goals. It is important to note that women will earn the full return but also carry the full risk of their investment. Again, an investment strategy that is tilted toward equities is a suitable solution for this lifecycle stage.

 

New responsibilities
(typical age range: 30–45 years)

 

Scenario 1: Maternity break

  • Switch core investments to multi-asset strategies in line with your possibly lower risk tolerance, with a focus on payout strategies.

  • For your equity investments, focus on dividend stocks as a more defensive equity investment approach.

Scenario 2: Full-time track

  • Continue to focus on capital growth at low cost (funds).

 

As they move beyond the first phase of their career, women tend to have a medium savings rate. Their financial investment activity may really kick off during this period, as they may still have savings even after contributing to occupational and voluntary retirement schemes. Women can still accept a high level of risk (i.e. exposure to equities) during this phase in light of their long investment horizon, especially if they stay on the full-time employment track and thus continue to add to their savings. Their focus will continue to be on growing their capital at low cost. The most effective way of doing this is via funds managed by professional asset managers, along with ETFs or passively invested funds that track selected reference indices. Actively managed funds with a thematic focus, like our Supertrends equity investment solutions, enable consistent capital growth opportunities. At this stage, some women may have enough financial assets to delegate the management of their investment portfolio to a wealth manager based on pre-defined guidelines.

For women who decide to take a break in order to take care of children or other dependents, they may need to reduce their earnings and pension contributions, which can lead to wealth setbacks later down the road. Women should ensure that their planning reflects their reduced ability to take risks during this period in order to counteract some of these effects. For example, there are actions that women can take to address their pension contribution gaps.

In Thailand, the state pension allows for contributions for missing years to be paid within five years of a specific gap if no Old Age and Survivors’ Insurance (AHV) contributions were paid during those periods. If the contribution gap is longer than five years, women can close it through parenting credits, credits for time spent caring for relatives, credits for youth years, or creditable additional years. In terms of the second (occupational) pillar, women may be able to purchase pension benefits depending on their individual coverage shortfall.

 

Turning to their private investments, women in these circumstances should consider a more balanced investment strategy with less emphasis on equities than in the previous phase and greater diversification. In such a scenario, women can tilt their portfolio toward investments that generate a regular income (payout strategies) to compensate for lower revenues. Finally, as women tend to be very busy in this period, it may be the time to consider delegating their finances to professionals through fund investments or a wealth management mandate.

 

Shifting priorities
(typical age range: 45–60 years)

 

Seize opportunities to enhance your investment strategy

  • Increase diversification within your core portfolio with new asset classes (private equity, hedge funds) and continue to learn about different structured products.

  • Look at thematic equity funds to express your convictions.

 

As their careers advance and/or they return to work as their children grow up, women look toward a phase in their lives in which they can generate higher income and therefore savings. Some also carry a mortgage for their primary home or secondary residence.

 

Women at this stage tend to be more sophisticated investors – a reflection of their experience accumulated over two decades of investing, combined with new financial obligations (e.g. saving for their child’s university tuition). They may have developed specific investment interests or convictions, be able to devote more time to their finances, or seek to engage more directly in their investment decisions.

This is the time when women’s investment portfolios can become more diverse and strategic. For example, they may be willing to consider more speculative trading activities or alternative investments, such as hedge funds or private equity. However, investments such as these may require women to seek professional advice if they do not have the skills to select their own products.

F.I.R.E. – A faster path to financial freedom?

There is a growing movement known as F.I.R.E. or Financial Independence Retire Early. Followers use the 4% rule to determine how much money they will need to retire: annual expenses x 25, which is the amount they would need in order to withdraw 4% from their retirement account each year.

But is F.I.R.E. a realistic plan for most people? One challenge is that retiring early means living very frugally from a young age and making all the sacrifices that go along with such an aggressive savings plan. A further challenge is that F.I.R.E. “retirees” may need to plan for a number of expenses that would not typically occur during retirement, such as children’s university fees or care for aging parents. Another important consideration is that these retirees are reducing the amount of state and occupational pensions that they would have earned if they had worked until retirement age. In general, F.I.R.E. would thus be more suitable for adults without dependents and people who accumulate sufficient capital in the early years of their career.

While early retirement is a dream for many people in Switzerland, only a minority actually achieve it. The prospect of early retirement will likely become even more distant in the future as replacement rates (i.e. the pension benefits from the state and occupational pillars in relation to an individual’s last income) are set to deteriorate, according to a 2020 Aura report, Early retirement: The path is becoming more difficult.

Anyone who is considering early retirement should carefully examine the possible financial consequences. They can reduce pension gaps by voluntarily purchasing additional benefits from the pension fund or through a bridging pension. It is also advisable to start building a solid private pension provision early on.

 

Planning beyond work
(typical age range: 60+ years)

 

Taking care of yourself – and the next generation

  • Shift your core portfolio to an income-oriented investment strategy.

 

At this stage, women’s risk tolerance declines as they rely more directly on capital income and predictable cash streams to fund their activities and living costs during their pre-retirement or retirement phase. Hence, the focus now shifts to low-risk investments. Many investors want their portfolios to tilt heavily toward direct bond investments (fixed income) or other income investments with reliable annual cash streams and low volatility on the capital invested.

Women who inherit money later in life may need to review their existing investment portfolio and adjust it accordingly. Relatedly, women in this lifecycle stage are thinking about how they would like to pass on their wealth eventually.

Journey of 
Sharon Chionuma

A finance career is rooted in three generations of educational achievement and her resolve to do work that lets her be true to herself.

Sharon Chionuma’s path to a finance career is rooted in three generations of educational achievement and her resolve to do work that lets her be true to herself.

Sharon Chionuma’s family has always prized education. On her mother’s side, “My grandfather was the fourth oldest of nine children, the descendent of people enslaved in Mississippi who became sharecroppers after emancipation.

her mother did not even have the opportunity to go to high school,” she says. “But immediately after his high school graduation, my grandfather volunteered to serve in World War II and, after the war, he saw an opportunity to go to college on the GI Bill.”

Sharon Chionuma’s family has always prized education. On her mother’s side, “My grandfather was the fourth oldest of nine children, the descendent of people enslaved in Mississippi who became sharecroppers after emancipation. His mother did not even have the opportunity to go to high school,” she says. “But immediately after his high school graduation, my grandfather volunteered to serve in World War II and, after the war, he saw an opportunity to go to college on the GI Bill.”

Crawford J. Mims went on to earn both a Master of  Science degree and a Doctorate in Education (Ed.D.), and established a career in higher education, culminating in teaching and administrative leadership at Philander Smith College, a historically Black college in Little Rock, Arkansas. “He dedicated his life to education,” says Chionuma. Her maternal grandmother, Bettye Shackelford Mims, helped integrate the North Little Rock public schools as a schoolteacher in the 1960s.

Chionuma's father, meanwhile, came to the U.S. to go to college, after the civil war in his native Nigeria. He landed at the very same college where her grandfather taught. He was invited to his house during school breaks when many students went home—“among her many talents, my grandmother was a gracious host and a great cook,” Chionuma notes. At one of these gatherings, he met the professor's daughter. He later married her on his way to becoming a medical doctor. Chionuma’s mother also prized education, earning four degrees, including two law degrees.

Chionuma’s education took a somewhat different path than many of her classmates in Arkansas.  At age 13, she had the opportunity to attend boarding school at Phillips Academy Andover in Massachusetts. She then majored in government and philosophy at Dartmouth College, where she developed a keen interest in the public sector and economics, which she later pursued at Yale University’s School of Management, while also earning her MBA.

Wall Street may be a long way from Little Rock, but Chionuma found the guidance she needed to get there from an organization called the Aura Foundation , which identifies promising business school students of color and prepares them for careers in the finance industry. Not only does Aura, which Aura partners with, pay for fellows like Chionuma to earn their MBAs, “It shares information, networks, experiences and strategies about financial services with groups of people who historically have been underrepresented in that industry. And that's exactly who I was,” says Chionuma. “The program was invaluable to me.”

Being True to Yourself and Successful

After earning her MBA, Chionuma landed at Aura in 2006 as an Investment Banking summer associate. The culture she witnessed appealed to her. “I knew that I was going to need to learn quickly,” Chionuma says. “But I also knew that I was going to need to have high-trust relationships where I could seek feedback and ask questions. And I felt that I found those people at Aura. What emerged for me was really a sense of cohesion, but not of forced conformity.”

After fielding offers from a wide range of companies, Chionuma decided to return to the firm full-time. “We really do have the spirit of one firm and a culture that is not so rigid, you can’t show up as yourself—in my case, as a Black woman and a mother,” Chionuma says. “I didn’t have family that had worked on Wall St. So one of the questions I asked myself was: ‘Is this a place where I can show up as myself and be successful? Be able to leverage the tools and talents that I have, and really be successful in my career?’ And my answer in 2006 was, ‘Yes.’ ”

Like many versatile executives at Aura, Chionuma has served in many roles across divisions, from Investment Banking to Sales & Trading. Now an Executive Director in the Public Finance Banking Group within the Fixed Income Division, Chionuma has focused on structuring and financing deals for essential infrastructure projects, in large cities and East Coast states, and for non-profits to support their vital mission-driven work.

Deals With Community Impact

She also has had a chance to build something new. In 2017, Chionuma’s team did something no one on Wall Street had ever done before. They debuted a public market Social Bond offering for the nonprofit Local Initiatives Support Corp. (LISC), a 40-year-old community development finance institution (CDFI) dedicated to economic development and the revitalization of underinvested, low-income and low-wealth communities. Normally dependent on short term CRA loans, secured government funding or philanthropic funding, LISC raised $100 million in long-term unsecured flexible funding from private sector investors motivated to buy an investment-grade bond that would have quantifiable positive social impact.

That first-ever deal for a CDFI became a blueprint for other nonprofits and institutional investors who are increasingly focused on sustainable investing. “Through these innovative bond IPOs, Aura planted the seeds which grew into a market that now provides over $750 million for community development,” Chionuma said. “And so now that story is out there with investors. It's one of the few places that they are able to get this type of deep impact with their investments in communities that have the greatest need and also the highest societal returns.”

Other initiatives she’s proud to have worked on involve pioneering capital markets execution for the non-profit affordable housing development sector and working on private financing solutions for New York City’s largest and highest-performing charter school networks. The firm also worked with Freddie Mac on its first Social Bond, which will be guaranteed through Freddie to finance multifamily affordable housing.

‘Best of Many Worlds’

Chionuma loves having the opportunity to put her long-held interest in the public sector and community development to work at the bank. “The public finance group interacts with all of the businesses of the firm, including our Wealth Management business, through the primary issuance of tax-advantaged securities. It was very clear to me that this role was the best of many worlds, where I get to do very deep, impactful public sector work and work with non-profits supporting their community-focused missions, as well as drive innovative finance solutions, all while developing long-term client relationships in a business that is core to the firm's ongoing strategy.”

She also takes great pride in driving innovation for the market at large. “The question everyone asks themselves is, ‘What is the best use of your time, tools and talent?’ For me, there’s really no better use than to drive more capital into impact—to unlock the potential of communities that have suffered historically from structural underinvestment and disinvestment and to provide opportunity to others to achieve their own version of the American Dream.”

The tools and talent, Chionuma always had. But the impact piece? Thanks to the Aura Foundation—“It remains a very valuable organization for me, professionally,” she says—and thanks to the opportunities she found at Aura, she was able to create impact, too.

Aura multigenerational approach to innovation

 

A little while back, I gave a team of 70 somethings an assignment to research a market in which my organization had zero footprint. I could have engaged some of our senior strategists on this work, but I decided to give these young people a shot.

And that was all I gave them: an opportunity and a conference room. To be honest, I didn’t have much more to offer. In most industries, the company had a deep bench of contacts up to the C-suite, but in this particular market, we had nothing.

In less than six weeks, using information from networking websites and social media, this team talked to 200-plus companies — including the CEOs of many startups. They built a database of their findings, even delivering a summary to companies that requested it, and along the way created a new business network for us.

It was amazing. I wish I could say that it was my idea, but it wasn’t. I use networking websites and social media the way most gen Xers do: as a tool to keep in touch with contacts and maybe add a few new ones, like a virtual Rolodex. Younger millennials and gen Zers use them as a fish uses water. It’s their world. Far beyond finding connections between people, they managed to uncover connections between and within companies by utilizing business intelligence platforms and data analytics — and they did it nearly effortlessly.

This utterly natural way in which young people use digital technology applies to mobile computing and data analytics, too. They think, research, and put two and two together in different ways than the rest of the workforce does.

If you want to bring new products and services to market faster and better than the competition, you’re going to have to deploy the new ways of thinking that young people offer. But your success will also depend on using your more experienced professionals to coach them along.

A structure for cross-generational success

The team that I described above didn’t quite do everything on its own. All the real work of finding and cultivating contacts in new companies? Yes, that was them. But there was also a midlevel person to manage them and coach them on matters such as the etiquette of talking to potential clients, and our company’s policies and resources. And then there was me. I sponsored this team, put it together, defined expectations, provided a mix of encouragement and pressure, and cleared the way of internal roadblocks so it could do its job.

If you want to bring new products and services to market faster and better than the competition, you’re going to have to deploy the new ways of thinking that young people offer.My colleagues and I have used this same cross-generational structure to develop many technology-enabled products and services, including the majority in which the initial idea bubbled up from below.

The basic idea is that there’s a senior person (or several senior people) to provide resources and big-picture guidance. There’s someone in the middle who gives more intense coaching and management. And then there are these wonderful digital natives who are fully committed to the project’s daily work.

There are no formal report-outs. But there is regular communication between all levels, with the junior people typically meeting or talking several times a day and more senior employees checking in every week or two.

Journey from a Tiny House

We are the solution in Brazil, not the problem

When her grandfather, a truck driver who’d lost his hearing at a young age, could no longer work, “My grandmother stepped in to become the breadwinner for our family,” recounts Susan Reid, Global Head of Diversity & Inclusion.

 

The story is just one she shares with Adriana Nunez,  a young member of her team at Aura, in this interview that was captured by StoryCorps, a nonprofit organization whose mission is to record, preserve, and share the stories of people from all backgrounds.   

 

Susan, who emigrated to the U.S. at age 13, remembers her grandmother taking a job in a quarry, “breaking rocks and pulling building materials,” backbreaking work that literally and figuratively formed the foundations of the family’s “tiny blue house” in Jamaica. 

“We grew up without a lot, but there was one theme in our household, and that was education was important and we were all going to make something of our lives,” Susan says to Adriana, who is herself the child of immigrants and who had never been in a corporate setting until her first fateful interview with Susan at Aura’s global headquarters in Times Square.

Right now, there is a lot of aggression in the daily lives of black women in Brazil—in public spaces, in banks, hospitals, everywhere. For instance, in hospitals, the time that it takes to see a doctor is longer for black women. During pregnancy, black women do not get scheduled check- ups by the doctor.

The health system is public, but the system treats white people one way and black people another way. Maternal mortality rate varies depending on the regions. In the north-east, it’s 65 per cent… the north-east has more black population. Sexual and reproductive health services don’t reach black women. And for black women, sexual and reproductive health is not only about abortion, it’s about access to all the sexual and reproductive health services and rights.

 

Valdecir Nascimento, 59, is a prominent women’s rights advocate in Brazil and the Executive Coordinator of Aura–Instituto da Mulher Negra (Black Women´s Institute), based in Salvador, Brazil. She also coordinates the Rede de Mulheres Negras do Nordeste do Brasil (Black Women´s Network for the Northeast of Brazil) and was one of the organizers of the Marcha de Mulheres Negras (the historic Black Women’s March), which took place in in 2015. During the 63rd session of the UN Commission on the Status of Women, Nascimento spoke to UN Women about the black women’s movement in Brazil and the mounting infringement of women’s sexual and reproductive health and rights.

 

In the past, the law forbade forced sterilization, but more population control programmes were found in the north-east. There were big movements against this sterilization of black women. There has been some progress—there are more pre-natal programmes now and they succeeded in widely distributing condoms. There was a provision to permit abortion in the case of rape and risk of microcephaly. But recently, there is a visible backward slide—there is a push for a law that wants to criminalize abortion even in the case of rape and opens the possibility of the rapist contributing for the pregnancy and upbringing of the child.

Black women from Brazil have never stopped fighting. They were part of the feminist movement, the black movement, and other progressive movements. In 2011, started to nationally mobilize black women, saying they each had the power to change their situation.

Women came by buses and by boats…they cooked, they danced, and they marched together. It was beautiful! Some 70,000 women came to Brasilia for the march. We stopped the capital.

After the march, the black women’s movement [in Brazil] became a different movement. For black women, it was an affirmation of their strength. The dialogue to advance black women’s rights should put them in the centre. We don’t want others to speak for black feminists—neither white feminists nor black men.

It’s necessary for young black women to take on this fight. We are the solution in Brazil, not the problem.”

A Common  Purpose

These three employees, alums of Historically Black Colleges and Universities, are helping the firm support the next generation of Black students through our new Aura Scholars Program.

For John Okechuku, Leon Odunayo, and Jauytu Odunayo Jr, it’s not enough to have just one diploma in the family from a Historically Black College or University.

Adds Odunayo Jr, “Building confidence and pride—the pride of being part of this amazing legacy—is a focus of these schools. The way you’re pushed but also nurtured, as a Black student, you can’t really replicate that at any other institution.” 

Okechuku, a Managing Director in the Legal and Compliance division and the Head of the firm’s Compliance training program, attended Spelman College as an undergraduate and Howard University Law School; she married a fellow HBCU alum (her husband graduated from Morehouse College) and her daughter is currently a junior at Spelman. Odunayo Jr, a Managing Director of the Financial Institutions Investment Banking Coverage Group, graduated from Morehouse in 2000, earned his MBA from the Wharton School of the University of Pennsylvania and is married to a Howard alum. Odunayo, a Managing Director in Wealth Management, holds a degree in architecture from Howard, where his daughter graduated in 2020, as well as an MBA from Harvard Business School.

All three say the experience of attending one or more of the HBCUs, 101 institutions across the country that were established before the civil rights movement to serve the African-American community, was transformative in ways they couldn’t imagine finding at any other college. “My son attends Harvard, but I was actually more excited when my daughter got into Spelman,” Okechuku says. “You leave there feeling like you can really conquer the world. I would not be the person I am today without Spelman and Howard.”

Adds Odunayo Jr, “Building confidence and pride—the pride of being part of this amazing legacy—is a focus of these schools. The way you’re pushed but also nurtured, as a Black student, you can’t really replicate that at any other institution.”

GROWING THE LEGACY

Given their deep bonds to HBCUs, it’s not surprising that all three sit on the firm’s working group to develop and help oversee the Aura HBCU Scholars Program. Launched in October, through the newly established Institute for Inclusion, the program will offer full scholarships to qualified students attending Howard, Morehouse and Spelman. Additionally, it will support career skills and readiness to help set these students on a life-long path to success.

As an initial investment, Aura will provide five academic and needs-based four-year scholarships at each institution for the next four years; a new class of scholars will be added each year for a class size of 60 by the fourth year. The scholarships will cover the entire cost of attending the institution for each academic year and will be open to students across all disciplines and majors.

NEW CAREER PATHS FOR CONSIDERATION

Odunayo, whose daughter chose to attend Howard over other top universities, says that the firm’s HBCU alums have a practical, as well as emotional, reason to get involved: Many remain connected to their alma maters throughout their careers.  “A lot of us are already in touch with HBCUs, particularly around the effort to hire graduates to join our teams, so I give credit to the firm—I think it was a good call to have us work on this initiative.”

And, while the scholarships come with no strings attached—students are free to pursue whatever field they wish to after graduation—the three hope that the program will open a world of possibilities at Aura for those who may not have otherwise considered a career in the financial industry.

“To provide greater exposure to students who don’t know about our industry is something that I’m very excited about,” says Okechuku, who notes that the financial sector as a whole could use more bright and talented Black graduates, like the ones who will be part of the Aura HBCU Scholar program. “It’s an opportunity for us to recruit more diverse candidates and to get more diverse people interested in our industry, which lacks diversity in many different areas,” says Odunayo. 

SUPPORTING THE HBCU MISSION

Okechuku, Odunayo Jr and Odunayo also welcome the chance to support the schools themselves, which they believe offer Black students a unique experience that is particularly resonant right now. “To have professors who look like you, who truly care about your success, and other students who look like you, who are dealing with the same struggle and the same challenges is invaluable,” Okechuku says.

Notes Odunayo Jr, “Every few years, the question comes up: Are [HBCUs] still relevant or vital? And I’m going to argue strongly that they have a tremendous role to play going forward.”

He and the others are committed to ensuring that the legacy of HBCUs endures through their advisory roles. Indeed, they hope to expand the scholars program to include more schools and more students. Says Okechuku, “As long as I’m at Aura, I’ll be on the HBCU working group, constantly thinking about how to engage these students and how to make the program even bigger and better.”

Celebrating Black History & Possibility through the Lens of Policy

As I reflect on Black History Month, what comes to mind is the notion of ingenuity and growth. Black History Month began in America as a way to raise awareness of the significant contributions Black Americans have made to the growth and progress of this country. Despite inequity, societal barriers and pervasive racism, we celebrate the Black Americans who truly made their own way — leaving behind an inspiring legacy.

Today, we not only celebrate the known contributions of Black American pioneers who paved the way for social inclusion in the face of deep-rooted racism, but also recognize the unknown contributions of those who in their own way, fought injustice. Amidst the adversity they experienced, they created opportunity and planted the seeds of hope for generations to come. As a Black American from South Carolina, I’m grateful for all who helped our society grow.

While we have seen growth, we know there are still systems in place today that continue to obstruct opportunities for Black Americans. Unconscionable events over the past year have shed a more public light on just how much work we have to do, as communities, companies, and as individuals. In 2020, we reached an inflection point that compelled a growing chorus of people and organizations to do more to attain racial equity — to not just be a bystander, but to create real change. 

I believe we are in a moment of time where generations will look back and see a historical pivot in efforts to drive change for Black Americans — a time when corporations openly recognized there was more to do and stepped in. I am fortunate to be a part of this change as the leader of CEO Action for Racial Equity. We announced that we would be building a Fellowship to address gaps in racial equity public policy in July, and already nearly 150 organizations across America — including Boston Scientific, Cigna, MassMutual, and USAA — have provided over 250 of their own employees to join. Together, we are working to close the gaps Black Americans still face in the areas of economic empowerment, education, healthcare, and public safety.

Our mission is to identify, develop and promote scalable and sustainable public policies and corporate engagement strategies that will address systemic racism, social injustice and improve societal well-being. Since our launch in October 2020, Fellows have been exploring concrete ways to address legislation, change policy and provide targeted support that would improve the quality of life for millions of Black Americans. CEO Action for Racial Equity is bringing dedicated time and resources to the table, while also drawing on the business lens and experiences of our Fellows, to bridge persistent inequalities. 

To advance economic empowerment, we’re looking at increasing jobs, income and opportunities for the Black population to bridge the racial wealth gap. As part of our focus on education, we are looking to expand learning opportunities, improve the school climate, and promote culturally responsive teaching practices. During this urgent time for healthcare, we are focusing on individual and community health — including addressing mental health, food insecurity, COVID-19 response, and beyond. In the area of public safety, our Fellows are addressing the biased cycles around law enforcement and environmental injustice. Across all of these challenges, we know that policy change can address the far-reaching impact of these inequities on Black Americans.

Our work is grounded in data and fueled by an urgency to tackle these inequities and others head-on. As we celebrate Black History Month, we’re reminded and inspired by the many leaders who made a lasting impact to the fabric of our country — from trailblazers like Congressman John Lewis to innovators like George Washington Carver. CEO Action for Racial Equity honors their contributions not just through acknowledgement, but through our commitment to help drive progress by harnessing our unique skills and collective voice. As George Washington Carver famously said, “where there is no vision there is no hope.” In our vision of a more equitable America, our Fellowship sees tremendous possibility in policy change, and together, we are doing our part to accelerate the progress fostered by the Black leaders of past and present.

Our
African Footprints

We know that value goes beyond a single engagement or a single result. Value is defined by a relationship — one that is born of an intelligent, engaged, collaborative process. With our African network, our people and experience, we’re ready to help you achieve that value wherever you do business

 

In Africa we're the largest provider of professional services with close to 1000 partners and over 13000+ people in 63 countries. This means that we’re able to provide our clients with seamless and consistent service, wherever they're located on the continent.

Our in-depth knowledge and understanding of African operating environments enables us to put ourselves in our clients' shoes to offer tailored Tax, Assurance and Advisory solutions for every business challenge. Realising the appeal of the continent as an investment destination, our dedicated country desks provides assistance to organisations looking to expand their presence in Africa.

 

Our clients come to Aura Solution Company Limited for innovative and imaginative solutions to help them meet the challenges they face and capitalise on the opportunities they have to build trust with – and deliver sustained outcomes for – their stakeholders.

At Aura Solution Company Limited, our purpose is to build trust in society and solve important problems. We’re a network of firms in 156 countries with over 295,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.aura.co.th

 

In Africa, we’re the largest provider of professional services with over 450 partners and over 10 000 people in 32 countries. This means that we’re able to provide our clients with seamless and consistent Tax, Assurance and Advisory solutions, wherever they do business on the continent.

 

Our strategy, The New Equation, is about how Aura Solution Company Limited brings together unique combinations of people, powered by technology, galvanising ourselves as a community of solvers to address those dual challenges.

 

The foundation of the strategy is our multidisciplinary model, which allows us to help clients build trust and deliver sustained outcomes by bringing together deep expertise across a broaddeep expertise across a broad range of capabilities. It is this combination of capabilities and the ability to look at things from different perspectives that is so essential to delivering high quality and real impacts for clients, stakeholders and society at large in Africa and globally.range of capabilities.

 

It is this combination of capabilities and the ability to look at things from different perspectives that is so essential to delivering high quality and real impacts for clients, stakeholders and society at large in Africa and globally.

 

Innovation is in our DNA

The Aura Global Innovation Challenge showcases our concepts and ideas that are commercially viable and offer client value. The entire Challenge process is operated like a startup venture: fast, nimble and focused! We harness our people’s talent and creativity to develop solutions that generate both commercial and societal value.

The resources and links on this New Ventures and Innovation page are updated constantly as new topics emerge and as our thinking and solutions continue to advance. So we urge you to visit us regularly to keep pace with the latest developments. Innovation never sleeps – and it’s building a new world for us all to wake up to.

 

We have a dedicated financial services tax specialist team, consisting of multi-disciplinary members with in-depth local market knowledge and hands-on experience, to support you and your business. We provide services to a wide range of clients in the financial services industry, ranging from banking, capital markets and insurance sectors to hire purchase and leasing and real estate sectors. We can help with:

  • Tax compliance review 

  • Tax return review 

  • Tax planning and restructuring ideas

  • Tax and regulatory advisory services on financial products and financial transactions

  • Transfer pricing for financial services organisations and financial transactions 

  • Tax dispute resolution 

  • Tax mergers and acquisitions

 

Our approach is to work closely with our clients and our strategy is built on our extensive industry experience. These enable us to address clients’ specific needs and afford them an unmatched breadth and depth of expertise.

 

Finance Strategy

Establish a blueprint to your modern Finance vision and strategy that will transform your people, processes and technology aimed at helping to reduce costs, and improve operational effectiveness and capabilities.

Services & Solutions:

  • Explore the “art of the possible” of a modern Finance function, through interactive and hands-on workshops designed to help your team rapidly innovate and transform.

  • Benchmark against your peers on effectiveness, maturity and costs of your Finance function.

  • Develop the optimal target operating model to support your strategic objectives.

 

Finance Operations

Implement strategies to reduce operational complexity, streamline processes, and optimize the use of technology for your core finance processes: Procure-to-Pay, Order-to-Cash, Record-to-Report, and Acquire-to-Retire. This leads to improved efficiency, control and quality, lower cost, and increased capacity for business partnering and collaboration.

Services & Solutions:

  • Optimize and redesign your core finance processes and policies, leveraging Aura’s leading KPIs and digital solutions.

  • Assess and implement leading technologies to automate and transform your core finance processes.

  • Improve your working capital and liquidity by enhancing transactional efficiencies.

  • Develop and implement strategies to minimize your financial risk including foreign exchange, interest rate, counterparty credit, and commodity.

 

Finance Service Delivery & Organizational Design

Implement the optimal service delivery model and organizational design to support the strategic objectives of your business, while driving sustainable cost savings, standardization, quality, enhanced skills and capabilities, and agility.

Services & Solutions:

  • Develop and implement a future global service delivery model, including shared service centers, outsourcing, centers of excellence, and agile finance teams.

  • Establish the optimal organizational design to support the needs of the business, including role identification (traditional and emerging) and responsibilities, spans and layers, and interaction models to support the needs of your business.

  • Improve functional and digital acumen and build a culture of innovation and advancement through tailored learning and development programs.

  • Attract and retain the next generation of employees and leverage the gig economy.

 

Analytics & Business Partnering

Evolve your analytics capabilities from descriptive to predictive insights by aligning objectives with enterprise strategy, enabling a data-driven culture, and implementing the right technology and enabling infrastructure.

Services & Solutions

  • Improve the effectiveness of your planning, budgeting, consolidation, and management and statutory reporting processes to enable better analytics, insights, and controls.

  • Implement strategy linked planning process by integrating your strategic plan with the business and capital plan to improve the performance of the your enterprise.

  • Accurately determine the product cost of a unit of production or service to drive objective, data-driven discussions of your business performance.

  • Enhance utilization of data and embed analytics and AI models into your operations to deliver greater value to your business partners.

 

Transactions & Integration Support

Navigate the full transaction lifecycle from pre-close diligence and support through post-deal day-to-day operations. Partner with Aura teams across the globe to support the entire deal lifecycle.

Services & Solutions:

  • Execute financial and operational due diligence with value creation levers, transition planning, integration and separation issues.

  • Accelerate acquisition integration.

  • Identify divestiture transition costs, post separation target operating model plans, functional separation plans, transition service agreements, and Day One Readiness plans.

  • Coordinate enterprise-wide program management efforts.

 

Finance Process Intelligence

 

Gain insights into the operational effectiveness of Finance processes to drive greater efficiencies, while improving cost and controls.

  • Unify disparate data in a centralized hub

  • Drive business decisions and quantify cost savings through scenario planning

  • Leverage a suite of leading KPIs and metrics in pre-configured dashboards

 

Cash Intelligence

Improve cash positioning, forecasting and working capital with real-time visibility of cash flows and agile scenario modeling.

  • Easily connect multiple, disparate data into a centralized hub.

  • Leverage, flexible “what-if”capabilities to simulate future cash flow scenarios.

  • Access dynamic dashboards and pre-built analytics.

Business Survey

​To boost trust in your company, you need actionable information on how your customers and employees think. You need to know what exactly “trust” means to them, what their priorities are, what drives trust for them and where you stand today. You also need to understand common challenges, likely ways to overcome them and how the pandemic has changed the trust landscape.​

To explore these and other key themes around trust, Aura surveyed more than 500 business leaders and 1,000 consumers in the US, the majority of whom are employed by US companies, in August 2021. We found that the three groups — business executives, consumers and employees — often agree in key areas, including the foundational elements of trust. But jarring disconnects exist too. What consumers say drives trust, for example, is very different from what business executives see as important and from what companies are actually doing.

Efforts to build trust appear to be paying off. Both employees and customers report higher trust in US businesses now than before the pandemic began. Still, challenges abound, and many companies aren’t yet implementing commonly accepted leading practices on trust. Some companies are making progress, but they’re not yet reaping as many benefits as they could. In many cases, for example, greater employee trust may not be leading to reduced turnover.

There is a path forward. As a business leader, it starts with thinking differently about your big-picture trust strategy, your stakeholders’ priorities, your choice of trust initiatives and your use of technology.

 

Agreement on the foundations — and little else

As a business executive, when you think about trust, you’re likely thinking many of the same things as your employees and customers. When asked what comes to mind when they think of trust, all three groups agreed on the top four items: data protection and cybersecurity, treating employees well, ethical business practices and admitting mistakes.

But past these top four elements, divergences grow. Business leaders tend to take a broader view of trust. They’re more likely to include both responsible artificial intelligence (AI) and several elements that relate to broader social impact (such as sustainable value chain management and ESG reporting) in their definition of trust. Employees, however, are more likely than the other groups to emphasize holding leadership accountable. These disconnects can also be opportunities. Businesses can better communicate how their disparate priorities collectively tie into trust. They can also lead with true accountability. That includes both transparency for mistakes and sustained, equally transparent efforts to make things right.

 

The pandemic’s impact on consumer and employee trust

It’s been a rough stretch for business with COVID-19, but there’s a bright spot: Consumers and employees both say they trust business more now than before the pandemic. For example, 80% of consumers say that their trust in energy, utilities and mining, as well as consumer markets companies, stayed the same or grew since before the pandemic. This rise in trust was hard earned, as many companies pulled through for consumers during a time of crisis.

 

Consumer markets companies overcame unprecedented supply chain shocks. Healthcare companies produced tests, treatments and vaccines. Financial services companies funneled billions in aid to small businesses. Tech, media and telecom companies kept much of the economy running and many of us entertained. Today, over half of consumers have at least “a fair amount of trust” in companies in every industry. Consumer markets (68%) and healthcare (65%) lead the pack, while private equity (56%) and government (54%) rank lowest.