The Business Interview: Charles Hague
Julius Baer Leeds Office
Charlie Hague and I both agree. It’s difficult to understand the nuances of conversations over video platforms. Getting to hear first-hand from his clients over a coffee and reading the body language is something that you can’t quite fully appreciate over a small computer screen.
It is, however, a sign of the times that will take a while to disappear.
The Julius Baer Executive Director for Yorkshire & North East is a naturally gregarious person who enjoys catching up and spending time meeting people.
“90% of my time is with clients and that will never cease to be the case.”
And Charlie is keen to set out his Yorkshire credentials. He hails from South Yorkshire where his family were part of the Sheffield steel scene.
“We had a family business for very many years. It was sold when I was at Newcastle University. So, to some extent I understand how clients feel when they go through the same process and understand their perspective.”
He has returned to Yorkshire and Leeds to head up Julius Baer’s regional team.
“I trained in London for 12 years with Kleinwort Benson then Barclays Wealth before joining Julius Baer,” he tells me.
His patch stretches from Chesterfield across to Newark and Lincoln then up the east side of the country to the Borders “on our side of the hills”.
We ignore the limitations of the video call and get straight down to chatting through some of the issues his clients are facing.
“What I am told frequently is that the Julius Baer ethos of offering global financial advice, delivered locally, is appreciated.”
“There’s huge value in high-quality global advice being delivered from somebody who knows the patch and the professionals operating across the region. These connections and links between businesses and communities are important and beneficial for clients.”
Charlie, who has nice turn of phrase, describes it as “boots on the ground.”
There has been so much happening across the business world that I am keen to swap notes.
“I think there is generally pent up excitement, a cautious optimism.”
“Throughout the pandemic I have been surprised by the number of times I have heard clients say, you know what, it’s not ideal but we have found new ways of doing things, worked out how we can do more for less, or pivoted our business in a certain way. Many have found new ways to market and new uses for products.”
“The amount of silver linings I have come across is staggering.”
For Charlie, the diversity of his client base along with the geographical area in which he operates, are the fun things about his patch, and which make it such a good place to do business.
“You get the old heavy industry & engineering in South Yorkshire, the old textile industry in the west, the agricultural heartlands of North Yorkshire and the old
shipping businesses in the east.”
“Andrew, the innovation, and ability to change is marvellous. In East Yorkshire, the transition into renewable energy coupled with South and West Yorkshire looking to divert more of those old skill sets into newer technologies, is fascinating.”
“My clients range from pharmaceuticals to offshore wind and from supermarkets to manufacturers, but with a lot of new technology in between.”
Getting round to hear directly from clients at the coal face leads to his cautious optimism point and figuring out what the new normal will look like.
“Eventually it will probably look something like the old normal, though it will take different sectors different times to get there as they figure out their route maps.”
The pandemic has hastened some changes and we get granular on markets.
“Clients that were market aware, interested and wanted to discuss their portfolios in detail before this pandemic have become even more so. Those clients that enjoy the process of portfolio reviews have become more interested in what markets are doing.”
“Equally, there are clients who are perhaps less hands on, the ones that want to engage around building a strategic mandate but who are then happy to hand it over on a day-to-day basis. They just want to know we are there and thinking about them, and to tap into our international global resources.”
“Even our agricultural clients are adapting. The majority are not professional farmers, but choose to be farmers or linked to the land in some way. A lot of the clients in the space have diversified in to commercial or residential property or leisure.”
“The leisure side is looking to benefit from staycations and there will be changes in residential property as many of us look to get away from the regular commute.”
“It’s quite easy to fly at 35,000 ft and get a stereotyped image of somewhere. One that is completely wrong. It comes back to my boots on the ground comment. If you are not embedded in a community, you don’t know.”
Even though we are discussing the Covid-19 impact on the business community, we can’t quite get away from the B word.
According to Charlie, his clients’ views on Brexit are diverse. He says it was palpable at the time although views changed the closer you got to London.
“In some ways it forced businesses to look again at their business models, and what changes they needed to look at.”
“Julius Baer is an international Swiss-based business and that puts us in a strong position. We found clients wanted to tap into our international wealth planning to discuss how to structure the holding of their wealth across different jurisdictions. That is a significant differentiator for us.”
“The overarching thing we have heard from clients in Yorkshire are the huge Brexit opportunities. Whether it is manufacturing, be that old, or new technology the last 10 years have been about just in time and the efficiency of supply chains. What we are now seeing and hearing from clients, is that the robustness and sustainability of supply chains matters, driven partly by the diversification of supply chains and about bringing them closer to home.”
“I was with a client who makes high end hand tools. Demand has gone through the roof and the company is recruiting new people. A well-known DIY chain wants to stock the products alongside stuff from the Far East. I think that’s about robustness, sustainability and reassurance, plus the Made in England brand, which is coming back into play.”
“It’s a real opportunity, if you talk to corporate finance guys or corporate lawyers in our region you have to book calls weeks in advance. Partly that’s what we are seeing with Brexit but also partly with potential tax changes.”
In a way the Budget was inevitable. “Everything that has been spent over the last year has got to be paid for in some way, at some point, be that higher taxes, inflation or some form of public to private transfer of capital, which we will continue to see. The budget was more interesting for what it didn’t say that what it did say.”
Image by David Schwarzenberg from Pixabay
“Owners of liquid capital are looking at what they can do in the short term. Owners of private businesses and agricultural land are thinking the same. There are no shortage of conversations going on.”
“Six months ago, in the middle of summer and mid-pandemic, if I had said corporate financers and lawyers were going to be busier than they have ever been Andrew, I think you would have raised your eyebrows and yet that is where we seem to be.”
Charlie and I move on to the UK economy. The pound is telling an interesting story.
As Charlie says, there has been an overhang from Brexit for a long time.
“Notwithstanding that the overhang has not gone away, and that there are frictional costs to businesses longer term that are still bubbling away, the pound is nevertheless rallying significantly against the euro and the dollar.”
As to the vaccine roll out it has been amazing success and played a part in that.
“It is giving the UK a real competitive edge particularly over our friends in Europe. And maybe it won’t last forever but we are certainly seeing its benefits now.
Both from a pandemic perspective and more broadly Europe is facing challenges too.”
Looking across the Pond to the US, Charlie says the States is going great guns on the rollout and have “approached it in a very American way”.
The economy was never shutdown as much as ours and has reopened quickly, and will grow strongly maybe the strongest growth in 20 or 30 years, admittedly from a low base.
“If the strong growth is boosted by the on-going stimulus, which we think it will be, plus boosted by a mini consumer boom, which we think it will be, it will lead through to some very strong earnings growth.”
For Julius Baer, its Yorkshire office has been open for three and a half years and is a huge vindication of its strategy of offering global, discrete, specialist advice for families, delivered locally by people who know what their region is like from the ground up.
“For families, the preservation of wealth and succession planning are still topics to discuss and not a lot has fundamentally changed.”
“Those family businesses that want to remain family business have a very long time horizon. They can invest and take opportunities that quarterly reporting denies to some listed businesses.”
Image by Engin Akyurt from Pixabay
Our time is up, our virtual coffees nearly finished; if we had been in a café, we would have moved on to different things but for now the clinical aspects of technology means we will look forward to catching up in person when lockdown is finally behind us.