Ladies who don’t lunch: Maike Currie talks to Hermes Investment Management’s Harriet Steel about success, failure and building things
Most people detest building. Whether it’s a new build, extension or renovation, chances are it will feature somewhere on the list of life’s more stressful events, perhaps only a few notches below death, divorce, starting a new job and moving home.
Harriet Steel, global head of business development at Hermes Investment Management, however, relishes it. In fact, she’ll move home regularly, just so she can take on a new project and “build something”.
It’s probably down to her “inner frustrated architect”, she tells me over lunch at Coq d’Argent restaurant in the heart of the City. You see, she was never supposed to be in finance.
Having grown up in a globe-trotting family, Harriet was schooled in Britain but decided to study architecture at Princeton University. As part of her studies, she had to submit a written piece alongside her design work, and embarked on a very ambitious project trying to quantify the value-add of design in residential real estate development. “It got really complex and beyond the scope of the architecture department,” explains Harriet. “I ended up with an adviser in the economics department and this got me interested in the more commercial aspects of real estate. So when I finished university, I took up a career in real estate in London, working on the acquisition team, coming up with the values for particular sites.”
She was set on a career in the sector but then external factors intervened, most notably the property crash of the early 1990s. With a mortgage to pay, and interest rates doubling overnight, she found herself looking for a job in the City. “I can’t pretend that I had some great vision about being some sort of financier – I simply knew a lot of my friends who weren’t having trouble paying their mortgages and making ends meet were working in the City and I decided to follow suit.”
She ended up joining Bankers Trust, with a job on the capital markets trading floor. “I liked numbers and, while I enjoyed all the visual aspects of architecture, I realised my aptitude for understanding things quantitatively.”
The first day she walked on to the trading floor felt like walking on to “some kind of an alien planet.” “It was a bit zoo-like at times – you can just imagine, back then, a 400-person trading floor with only around 10 to 20 women. It didn’t intimidate me, though. It was like a giant frat-house scenario and I was used to going to all those parties,” she laughs.
It’s harder to be noticed as a woman – you really have to be much better than the guy next to you to get noticed because of unconscious bias
She learnt quickly, trading currency options and holding senior derivatives sales roles in Paris, London and New York. “I really enjoyed it. We did some electronic trading but most of the trading was over the phone. You had to be quite good at multi-tasking – pricing up options and swaps with markets quickly shifting – it was a good environment if you were a thrill-seeker.”
Are you a thrill-seeker? I ask. “No, I don’t think so especially, but I’m not intimidated by things moving quite quickly around me and I’m not scared of change.”
She describes her City debut as a “positive experience” with great senior level sponsorship. “It was a really stimulating environment to work in at the time. It was really at the forefront of derivatives as a tool – you know, we were inventing things as we went along.”
I stop her in her tracks, and ask the inevitable question: “So did you help cause the credit crunch?” She pauses, unfazed by the question. “Now, that’s a good question because it does get attributed to lots of different people. I do think that interest rate swaps were the forerunner instrument to what then became credit default swaps in the corporate sphere, and, yes, a lot of that very early stage work that was done in inventing some of these instruments can probably be attributed to the downturn.”
From Bankers Trust she moved to Morgan Stanley’s fixed income group in 1996, working mostly on the client-facing side of the business. “I enjoyed it, although it was based in Canary Wharf back in the dark days of Canary Wharf, when there was nothing there. I think there was one pub.”
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She wasn’t at Morgan Stanley very long before she got pregnant with her first child. “That wasn’t part of the plan – a lot of my life hasn’t been part of a plan. We had planned on waiting longer, but it happened early on.” At the same time, her husband’s career meant a move to Monaco, where she had her three children in quick succession. “It was very hard at first – imagine being transplanted from working in Canary Wharf and having no children, to living in Monaco with three kids under the age of four.”
But it didn’t take her too long to venture back into finance, establishing Portico Advisors, an asset raising company for hedge funds, private equity and real estate strategies. “It started out in the early noughties and grew into what was a great business model. It was interesting and fun with lots of different investment strategies. Then suddenly the world blew up, all the redemption notices came in and things changed.”
She admits that closing down her business, and letting the people who she had employed go, was one of the hardest things she’s had to do. “Our first asset raising was for a credit fund so we had a lot of the early warning signs in the spring of 2006 when credit markets started showing signs of stress – it didn’t come as a complete surprise. But what was a surprise was the sheer enormity of it all as the size of those balance sheets became obvious to the world. It was… well you’ve seen the Big Short, right? There were a few people who worked it out, but we weren’t one of those.”
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It was time to build something new, and Harriet decided that the next obvious step was to leverage the different experiences she had in financial services, from trader to capital market sales, principal investor, business owner and alternative asset raiser. Then the Hermes opportunity came along.
Chief executive Saker Nusseibeh recruited Harriet with a brief to redesign the business development function and transform Hermes into a fast-growing and profitable third-party business, relevant to the needs of institutional clients. Since her appointment, third-party assets under management have tripled, external client revenues have bulged from 15 per cent to 40 per cent of the total, and the company has 200 new clients.
It’s fine to fail and, sometimes, you’ll fail spectacularly
“At the time, I couldn’t decide if this was the best business development job in the City or the worse business development job in the City.” Four years on, and she says with conviction that it has been one of the best.
In driving the change she needed at Hermes, she jests that she might have interviewed half the City, recently appointing her first direct female report. Is it harder to hire female talent in senior positions? I ask.
“No, but I do think you have to work harder at it. I don’t think it’s a case of institutionalised sexism, that’s not what I am saying at all. I have never really felt that my gender has held me back in any way. At times it has been a little bit harder, but I think it’s this unconscious bias that people like to hire in their own image.”
Harriet adds: “The senior headhunters are great champions, by the way. They’re always trying to build one woman into the shortlist. But then talk to women who get to the final two for a job but don’t get the role because…” She holds up her fingers to make air quotes. “They’re not quite the right ‘cultural fit’.”
This clearly infuriates Harriet. “I mean, really, what does that mean – ‘cultural fit’? The whole point of diversity on boards and excos (executive committees) is to get different cultures represented, encourage different ways of thinking and avoiding group think. I talk to so many women who get down to the last two, get on with the person hiring like a house on fire but then don’t get the job because the other person was a better cultural fit – i.e the ‘other person’ – white, pale, male…stale… was the safer option. I think women are still seen as the risky option.”
Harriet adds that she feels lucky in having a good male sponsor in her boss. Having a sponsor, especially in a larger organisation, can make all the difference, she says. “It’s harder to be noticed as a woman – you really have to be much better than the guy next to you to get noticed because of unconscious bias.”
I ask her about her own upbringing. “There was never any question that what was expected of us would be any different had we been boys – you know, having grown up in the 70s and the 80s. We were brought up to be competitive and to compete to win. That was how it was in my family: it’s a race… let’s see who can win. Let’s have a chess tournament… and see who can win. We were brought up to believe that it’s one big competition and you’re in it to win it. I am still very competitive, mostly with myself. I like to set the bar high.”
A competitive swimmer at school, she jokes about taking up triathlons after having children. “I needed a competitive outlet… and now I am reduced to this…” She laughs and points to her Fitbit. “I thought I was a really good athlete and now I am reduced to counting my steps. I could run marathons really fast, now I think 10,000 steps is a triumph.”
Harriet admits to raising her own children with a similar mind-set, but without winning becoming the be all and end all. “We’ve always encouraged our kids to have a go. It’s about giving them the confidence that they can win, that they can enter the game. But also that it’s fine to fail and, sometimes, you’ll fail spectacularly. You need to not be scared of failure. Even the most successful people will face failure.”
It’s time to go. Harriet takes a look at her Fitbit. She’ll be counting the steps back to the office.
WHERE WE ATE
COQ D’ARGENT, 1, POULTRY, LONDON EC2R 8EJ
“Excellent French cuisine”
Nice venue. Perfectly executed menu. The souris d'agneau, crème brulée and tarte à l'orange were simply delicious. Amazingly reasonable prices for this quality of food. Great wine list. Very professional staff and service. We would recommend this restaurant even to our most demanding friends.
Source: Tripadvisor
LADIES WHO DON’T LUNCH is a regular feature in which Maike Currie profiles a woman working in the City. All interviews are conducted at a restaurant table – as an exception, nothing is eaten within the proximity of a PC, with a plastic fork or out of a cardboard box. Maike writes about investments and money matters for Fidelity International, following a career in financial journalism. @MaikeCurrie