A global affair

Standard Chartered has a rich history in financial services – 150 years in the business of banking. The company operates in many of the world's fastest-growing markets with an extensive global network of over 1400 branches (including subsidiaries, associates and joint ventures) in over 50 countries in the Asia Pacific Region, South Asia, the Middle East, Africa, Europe and the Americas.

This diversity lies at the heart of the bank's values and supports the bank's growth as the world increasingly shrinks to one global market. “Diversity is extremely important,” confirms Hopkins. “Diversity and inclusion is a distinctive element of our brand, our culture and also the way that we manage employees. We set up a diversity council within each region where they look at specific actions that we can take to promote concepts of cultural awareness. That’s at the heart of what we’re trying to do.” Of course, diversity has tangible business benefits. A diverse work culture leads to increased awareness of international trends and ¬– usually – a more creative environment too. HR professionals have long known that different kinds of people interacting can lead to new value generating activities and a more creative environment all round.

Strategic position

For Standard Chartered, their strategic positioning involves having a strong focus on emerging markets, particularly in Asia, Africa and the Middle East, which is their strategic focus. This is unsurprising when you learn that over 90 percent of their profits come from those areas. As trade is increasing between Asia, Africa, the Middle East and OECD markets, the bank is well positioned to capture a large percentage of that. To give an example, Hopkins mentions that the trade between Africa and China has increased almost tenfold over seven years up to 2006 to US$56 billion. He predicts the figure will increase to the region of US$100 billion by 2010.

Luckily for Hopkins, Standard Chartered is extremely well placed to capture some of that trade. “We’re one of the biggest foreign banks in both Africa and China. In China, we already have a presence in 15 cities with 30 branches and sub-branches; and we’re looking to increase our network rapidly, but it’s obviously a huge market to penetrate.”

Standard Chartered are – of course – in the enviable position of having spent 150 years building this global network. But merely operating on this international scale isn’t enough to guarantee annual profits that the market estimates will approach US$4 billion in 2007. The financial services marketplace is becoming a crowded one, particularly as the internet has meant some organisations can spread their presence further than ever before.

Local markets and sustainability

In order to compete, the bank has found it needs to have a comprehensive local knowledge as well as capitalising on its global network. “We’ve been in our core markets for a long period of time,” says Hopkins. “We’ve been in some countries for over 150 years, when the bank was first set up. Obviously we’ve had a lot of time to build up relationships with the regulators, with the customers and get an expert sense of the local challenges.” But it’s more than just being in a place for a long time, he continues. You have to make the effort to get embedded in those markets: by employing local talent and supporting the local community.

This kind of approach is typical of Standard Chartered’s commitment to sustainability, in the broadest sense of the word. The bank looks at the entire spectrum of its ability to deliver sustainable business for the long term through all its markets. “We’re interested in sustainable business practices and the long-term impact we have on a community. Responsible selling and marketing and how we treat employees are a big part of that. It’s obvious to us that this is the heart of building our business on a local level, long-term. Of course the economic aspect is important, but it’s the broad range of activities around your business that will make it sustainable for the long-term,” Hopkins says.

In 2006, Standard Chartered started publishing a sustainability report across their seven key areas of focus. This ranges from responsible and sustainable lending activities, to environmental aspects such as how much the bank is lending to renewable energy products, through to what it is doing on a community investment basis. “We set targets,” explains Hopkins. “For example, 0.75 percent of our profits will be invested in community investment projects around the world. Part of that is attributable to employee volunteering, so we give each of our employees two days’ paid time to support volunteering activities.”

The environmental aspect of corporate social responsibility is also taken seriously: Standard Chartered measures its carbon footprint across 40 countries. The amount of energy and other resources used and by-products and waste created is measured in each of its locations. The bank then monitors that while targeting deductions for future development.

Its global nature means the bank faces a considerable carbon footprint from travel. Trying to make that more efficient is a goal, although in an international business it is proving to be a challenge. To meet this, the bank is using video conferencing where it can. There are video conferencing facilities in most of its bigger locations, but Hopkins concedes this technology is best used for two or three-hour meetings. Any longer than this – or for trust-building initial meetings with customers – and the bank has found that air travel is often the only way. In his own words: “Reducing emissions for air travel is an issue we’re trying to address, but it’s not the easiest when you’re running a global business.”

Technology

The C-suite in other industries is slowly realising what those in financial services have known for a long time: technology is key in delivering services to customers. Where banks are concerned, millions of transactions must be managed per day, and all of those transactions must execute accurately and smoothly. “Because of this, we have to make a significant investment in technology every year. We have to invest in our core operating systems through to desktop systems. Significant teams of people are involved in running and maintaining our systems.” Regulatory requirements mean that banks have to keep on top of these things more than in other sectors, and this requirement is also driving the business, according to Hopkins: you can’t underestimate the importance of technology in maintaining competitive advantage in financial services.

With regards to specific initiatives, Standard Chartered has an initiative called eBBS, which operates through an electronic banking system and has been developed internally using the latest technology and architecture. It has been implemented across 30 countries within the bank’s network, allowing it to standardise operations and allow increased flexibility for future change in the systems, allowing the bank to bring new products into play more quickly.

Innovation

Innovation is also a big topic for business. Being a bank, Standard Chartered has to innovate effectively for new ideas on products and services; underlying that is innovation and technology. The bank is in the enviable position of having an innovation lab in Singapore which is linked to Singapore Management University. This provides it with excellent knowledge within the research community in Singapore (and globally through the SMU academic network). Looking to the future, use of mobile technologies and fingerprint and other biometric security are two things Hopkins points to that will feature more prevalently in banking.

The future

Despite the fact that the company’s main focus is Asia, Africa and the Middle East, the European franchise is extremely important to the bank: it banks many of the biggest multi-national institutions that do business in Asia, Africa and the Middle East. There are about 1900 employees currently based in Europe, and the bank has completed – or is in the process of completing – acquisitions for American Express Bank, Pembroke (an aircraft leasing company) and Harrison & Lovegrove (an oil and gas M&A advisory group). Standard Chartered has seen good expansion in the European network, giving the bank presence in a number of new countries next year when the American Express Bank deal is complete: Germany, France, Spain, Italy, Russia, Romania, Ukraine, Kazakhstan, Poland and Luxemburg (which will be another strategic business centre). Given all this activity, it’s no wonder Hopkins is bullish about Standard Chartered’s future. “The company as a whole is doing really well. There’s good momentum into 2008 and we’re very optimistic about the future. We’re well placed in many of the world’s most dynamic and fast grade markets.” Which sounds like the best place to be.

About Standard Chartered

Standard Chartered has a history of over 150 years in banking and operates in many of the world's fastest-growing markets with an extensive global network of over 1400 branches (including subsidiaries, associates and joint ventures) in over 50 countries in the Asia Pacific Region, South Asia, the Middle East, Africa, the United Kingdom and the Americas.

As one of the world's most international banks, Standard Chartered employs almost 60,000 people, representing over 100 nationalities, worldwide. This diversity lies at the heart of the bank’s values and supports the bank’s growth as the world increasingly becomes one market.

With strong organic growth supported by strategic alliances and acquisitions and driven by its strengths in the balance and diversity of its business, products, geography and people, Standard Chartered is well positioned in the emerging trade corridors of Asia, Africa and the Middle East.

Standard Chartered derives over 90 percent of profits from Asia, Africa and the Middle East. Serving both Consumer and Wholesale Banking customers worldwide, the bank combines deep local knowledge with global capability to offer a wide range of innovative products and services as well as award-winning solutions.

Trusted across its network for its standard of governance and corporate responsibility, Standard Chartered takes a long-term view of the consequences of its actions to ensure that the Bank builds a sustainable business through social inclusion, environmental protection and good governance.

Standard Chartered is also committed to all its stakeholders by living its values in its approach towards managing its people, exceeding expectations of its customers, making a difference in communities and working with regulators.