Why I am excited about Santander’s future, based on my take from IMF/WB meetings in D.C.

After a busy week in D.C., where my team and I met with finance ministers, central bank governors and participated in several panels, here are the reasons why I am excited about Santander’s future

First. Responsible business is now mainstream, and is likely to remain so.

Whether it is a focus on so-called ESG (Environmental, Social, and Governance factors) or sustainability, investors and regulators now expect major businesses to have a strategy to be responsible -and this strategy needs to drive the business, and not be an afterthought. Indeed, this is what consumers, and particularly millennials, expect from business.

There was also interesting conversations about how fiscal policy might support climate change -“green spending”, you could call it. This, as Larry Summers suggested, could be a means to fight back against (secular) economic stagnation. 

What does this mean for Santander? 

As many of the people we met these days have recognized, we have a great story to tell on responsible banking and we will continue to tell it, as I did at the pannel with World bank president, Goldman Sach’s CEO and Ivanka Trump.

We are focused on embedding twin tracks, strengthening our culture, and delivering profit with purpose, to meet two challenges, the new business environment and inclusive and sustainable growth.

Responsible banking also means diversity and gender equality. There is no room for inclusive growth without equal opportunities. According to the UN, women remain less likely to participate in the labor market than men around the world (63% Vs 94%) and when they do, they are often underpaid and under-promoted.

This is why we support and empower women at all levels, inside and outside our organization. Having higher ratios of women in the workplace is not only fair, it is also good for business and shareholders. We have set 2 specifics targets for 2025: increase the number of women in senior positions to at least 30% and eliminate the gender pay inequality for those holding positions at the same level and area.

Second. Multilateral organizations - from the OECD to the FSB and our peers, are mostly in agreement that have we need a level playing field - and the dangers of outdated competition rules, regulations and tax systems, designed for the analogue age. This is neither fair nor sustainable and is creating distortions and contributing to inequality.

A number of participants made a strong argument for some form of data sharing (so-called data openness: in order to foster competition, companies are obliged to share data with competitors) but also the right of consumers to know what is happening with their data.

There was also a discussion about how we (private and public sector) can work together to use new technologies to enhance payment systems, and get faster and cheaper cross border transfers in a secure and trusted way, without disrupting monetary systems. All that said, although there was debate about what needs to happen, there was much less on who should be responsible for what.

What does this mean for Santander? 

On a practical day to day level as a bank, we must continue investing together across the Group in better, smarter and more accessible services for our customers, that empower them financially. This often means easy to use, simple, safe and effective payment and accounts solutions via mobile devices.  

A great example of this is Superdigital, our digital solution ‘to bank without a bank’ in Latin America, which will reach 5 million active customers in the medium term –that is a 10 fold increase since 2018, as we announced in our Investor Day in 2019.

Another great example: our micro finance initiatives, like Prospera and Tuiio, which combine digital tools with in the ground agents from communities and collaboration with partners to support low income and underbanked entrepreneurs. Together with other initiatives across Santander we have committed to financially empower 10 million people by 2025.

Overall, on the macro view, concern was slightly schizophrenic. People are pessimistic about all manner of things: the impact of negative rates in the EU, slow growth, Brexit, the impact of the disputes (on trade and also technology) between China and US, and the consequences of the breakdown in multilateral organizations.

But I -and I sense this is shared by most attendees- came away with an overall positive feeling about the prospects for the world economy, especially as the US consumer is still holding up. This is good for our US business. On top of that, Latin America will grow faster in 2020: Brazil was singled out by some for its lowering interest rates, reforms and investment opportunities, for example.

What does this mean for Santander?

Our diversified footprint across Europe and the Americas model should continue to open up many opportunities for Santander. We are serving 142 million customers -a number which continues to grow. Then there’s our Group’s scale and investment in even better digital and personal services, plus our strong team across the world. All this means we will continue to deliver profitable and more predictable growth in the years ahead.