Marie-Hélène Blattmann-Lenoir built on her EDHEC diploma with an MSc in International Accounting and Finance at the London School of Economics, and then turned towards banking (Swiss Bank Corporation, which later became UBS), a sector she has continued to explore in London since (Credit Suisse, then NatWest Group, working on credit risk management). We caught up with her in December 2020 for an assessment of the year gone by, marked by COVID and Brexit, and also asked her about the hope-inspiring initiatives in the banking world in favour of diversity, inclusion and the environment.

Can you tell us briefly about your current position and responsibilities? 

I’m responsible for credit risk in financial institutions with Natwest Markets, mainly working in the Europe, Middle East and Africa (EMEA) zones. You might say credit risk is the likelihood that a client will fulfil its financial commitments to the bank, whatever the product in question. My staff team – risk officers in London and credit analysts in India – and I estimate the credit rating of our clients based on several indicators, such as the economic climate in their country or the state of their financial health, and we determine the adapted risk appetite of the counterparty or sector concerned. I also work in direct contact with my internal clients (front office) to help them optimise the structure of their transactions as a function of credit risk.

I also manage a team that serves as an interface between front office and the risk officers and is responsible for approving and monitoring transactions (“flows”), as well as a team who develop our credit risk regulatory framework.

And finally I work with our chief risk officer on implementing our “people strategy”, which includes topics like diversity, inclusion, talent and business development, etc.

What qualities are needed to work in risk management? 

First off you need analytical skills of course, knowledge of the products on the market and a real interest in economics. But above all you must have an appetite to continue to learn in an environment that is constantly changing. We run mandatory training each quarter in areas as varied as regulation, cyber fraud and artificial intelligence, and we encourage professional skills development across all risk-related disciplines (transactions, credit, market, etc.). Many of our department members have just completed a Master’s at Edinburgh University that addresses climate change and was specifically developed for NatWest.

Data has become central to credit risk activities. So what kind of changes are you seeing in the human dimension of your everyday work? 

Retail banking relies hugely on data. The sector has made a clear shift in that direction, and I would say most new recruits are now in data. With the development of banking applications and fin techs, customers are only a few clicks away from all of their banking services nowadays. In more institutional banking this is not yet entirely the case, as transactions are more tailored and increasingly adapted to the client’s needs. When it comes to standardised market products (flow business), automation is developing quickly and some jobs are set to disappear.

Does data management allow banks to get closer to their clients and thereby reduce credit risk?

Data is of course a useful tool, but I think it is very important to have a relationship of trust between the bank and its customers. If you know your clients well, you understand their needs and seasonal shifts in their revenue and expenditure. And so you can anticipate problems. When things go badly, it’s important to be in regular contact with the customer to understand what’s going on at all times so you can support them. 

How is Brexit set to play out in the banking sector? 

That’s the big question everyone is asking themselves, but for the time being we don’t have many answers. The financial players are well prepared, they’ve all set up branches in an EU member state to ensure the continuity of their services. But it’s not in the interest of Europe generally because the market is going to be completely fragmented (Credit Suisse is in Madrid, NatWest Markets is in Amsterdam, others are in Frankfurt …) and therefore less efficient, with additional costs and potentially higher risks. That plays into the hands of other financial markets in Asia or in the United States. 

How can the banking world act to protect our climate and have a positive impact?  

The role of banks is essential if the targets of the Paris Agreement are to be met. Almost 1000 of us completed the Master’s course on climate change at Edinburgh University, so just imagine the impact that will have! In 2021, climate change will be on the agenda for all of our business activities, and the regulators now have huge demands in this area. The role of commercial banks is crucial in facilitating the climate transition. For example, banks have the ability to encourage green projects with favourable pricing, or to help companies finance their climate transition projects and penalise those that pollute the most. The same is true of retail banking, with lending rates that can be adjusted for people living in flood-prone areas or at risk of forest fires for example. Buying a house in those areas will be much more expensive from a lending perspective than in a zone without any such problems. Banks can redirect their capital to where it should be allocated. 

Is that being done in a coherent and pragmatic way or are we witnessing a “fad”? 

It’s very pragmatic and not at all a fad. Banks and investors have begun to tackle this in Europe and the UK, and now in the US since Joe Biden’s election win. If banks don’t align with one another on climate change considerations or ESG (Environment, Social & Governance) criteria, they will be penalised by institutional investors and potentially by credit rating agencies. Everyone is now saying they want to be carbon-neutral by 2030, but implementation has so far proven difficult because there is very little standardised data. Several stakeholders are trying to create a new reporting standard with different methodologies, but a uniform framework has yet to be developed.

What impact has the public health crisis had on your business sector?

With offices in Asia, we knew that the crisis was bound to hit Europe, but we never imagined it would be so intense over such a long period. We thought back in March that only 2020 would be affected, but we now know that the main impact on the economy, and necessarily on banks, will be felt in 2021. At the beginning of the crisis, everything was put in place to support the economy, and so to adapt as quickly as possible to the government’s proposed measures and above all avoid hastening the bankruptcies generated by COVID. Even though there weren’t really any new tools available, we had to adapt our analyses. To produce forecasts, we usually rely on past financial data. But we couldn’t do that because the data from December 2019 was useless in trying to understand what would happen in June 2020. We went back to the fundamentals, among other things translating GDP and unemployment projections into expected impacts on different sectors, country by country.

And now are you able to forecast a more general trend? 

Yes, we are relying on macroeconomic analyses at a country or continent level, as countries are not all at the same stage in terms of handling the pandemic. The more economists change their projections, the more we rely on their data and we can see which banks or which countries will potentially be affected more, and we try to assess the “winners” and “losers” in each country. 

What are you working on in terms of diversity and inclusion? 

Diversity is an area in which we share data with the UK financial regulatory authorities. The George Floyd drama in Minneapolis in May led to renewed efforts on diversity, not only with regard to women but also BAME (Black, Asian and Minority Ethnic) groups. There is a real desire within the executive to increase the pace of change at all levels. Around 13% of the population in London is BAME, and so we aim to have 13% of our staff from those groups in our company. The composition of businesses should reflect their environment.

How do you obtain the data?

That’s the challenge, collecting the data, because with the protection of individual data (GDPR), HR cannot or will not provide this information. So we sent out anonymous diversity and inclusion (D&I) questionnaires to all staff members, clearly explaining how the data would be used. Analysing the responses will help us identify and address the gaps in each department.

How will recruitment be done, based on this process? 

We can’t favour a woman for a particular job, as that would be positive discrimination. However, we aim for a list of candidates and finalists who represent what we are looking for. The panel of interviewers must also be representative. The lines have to be redrawn at all levels. Work is underway, but much remains to be done, particularly in senior management positions, where, even though women are beginning to be better represented, we are still way behind when it comes to minority ethnic groups.

How do you think it is possible to achieve this kind of inclusion without engaging in positive discrimination?

It requires a cultural shift and a new approach, where the first step is about learning to understand others. At NatWest, for example, staff have attended webinars to learn how to include those with hearing impairments in the virtual environment, which can be very hostile for them. We also celebrated Black History Month (Editor’s Note: an annual commemoration of African-American history) to open up more to black culture. This kind of initiative encourages exchanges and openness. 

What other steps have been taken to strengthen the involvement of staff members? 

We run social initiatives like the Charity of the Year, when staff vote for a charity and then organise events or other initiatives to raise money for it. It really builds up team spirit and group morale and allows for a broader contribution to society. 

When it comes to finance, what is EDHEC’s reputation internationally? 

EDHEC seems to be surprisingly better known for its research than for the school itself. I’ve recruited quite a few people from EDHEC in my career, and each time I was impressed by their skills and their ability to integrate. Senior management in the UK were calling out for more! It’s important to rely on the EDHEC Alumni network to show international recruiters that EDHEC is a benchmark when it comes to finance, and not only for research.

What are the EDHEC values that you still hold today? 

The one that is dearest to me is the international dimension, which the School embraced very early on. That’s what allowed me to do an exchange programme at the London School of Economics during my time at EDHEC, and later pursue a career in London. I would also say its strong sense of entrepreneurship, because across all business sectors and departments – especially right now – we need creative people willing to put everything they’ve got into their projects. Volunteer work and ideas can make anyone an entrepreneur in any business sector! That’s the mindset of the “People Forum” I set up in my risk department with volunteers, with the aim of creating a real staff strategy to address varied themes (diversity, career management and training) and establish a link between staff and the executive.

What does it mean to be an EDHEC alumna in 2021?

It’s at once a way to be a point of contact and about transmission and solidarity between generations, because EDHEC Alumni is a network that works in every direction. You need to know how to support it as well as benefit from its power. And it’s always useful to discuss ideas with students. You learn a lot by gaining professional experience and you want to hand something over, to help those who are starting out. It’s also about wanting to spread the good name of the School: in order for it to prosper, helping each other out is the way forward.