Trick or treat? Time to shine a lantern on open banking

February 2020 will be the stroke of midnight for open banking in Australia.  From this time forward, banking, and in the longer-term the broader Australian economy, will be transformed as the control of personal financial data moves from data holders to consumers.  But despite a tremendous amount of work by government and other stakeholders to build a robust and secure framework, whether open banking is seen by consumers as a trick or treat may hinge on effective communication.

Open banking is the sharing of personal financial data between consumers and financial institutions.  It has been presented as everything from an apocalypse for banks, with fintech beasts ready to strike, through to a wonderful new dawn for consumers. 
In May 2017, the Federal Government initiated a review into the potential introduction of open banking in Australia after its adoption in the UK, Japan and other countries.   A year later, all recommendations from the review were accepted.  These included the introduction of open banking from February 2020 starting with the big four banks, with eventual implementation across the entire banking sector, and longer term across other industries such as energy and telecommunications.

Importantly the recommendations also included the establishment of a consumer data right (CDR).  The CDR enshrines in law that consumers own their data, thus giving Australians the ability to obtain their financial data from institutions they currently deal with and share it with other providers.

CDR legislation was passed by parliament in August and the big four banks, as well as other institutions who want to participate in open banking from the outset, are now preparing for February 2020 when customers will be able to access the first tranche of their financial data.

The CDR is unique to Australia’s open banking model and paves the way for services that are tremendously rich in personalisation.  People increasingly want products and services that are highly tailored to them and open banking promises to be a thriller in this regard.   

From the overseas experience of open banking, we can see it has led to innovation in banking services and the emergence of new solutions.  Open banking was introduced into the UK at the beginning of 2018, and it has been estimated that it could realise £18 billion in value a year for consumers and SMEs.  However, take-up has been hampered by a lack of customer communication and education, and it is broadly viewed that much work still needs to be done in this area. 

Publics are also highly sceptical about the security aspects of open banking with many spooked by recent high-profile global data breaches.

Compounding this for Australia is a backdrop of distrust of financial institutions as the media continues to recall ‘horror’ stories that emerged during the Hayne Royal Commission.  Also, the CDR presents additional complexity to effectively selling the Australian open banking story to a wary general public. 

It is likely Australians will need to be convinced about the merits of open banking and then guided as to how to effectively leverage the CDR.  The onus will be on open banking providers to play this role and to earn an open banking ‘social license’. 

Open banking – and particularly the CDR – presents a great opportunity for Australian financial institutions, fintechs and consumers alike.  But the key to success will be to ensure people understand and embrace open banking rather than seeing it as something scary lurking at the front door.  It will be up to Australian financial institutions and fintechs to get stakeholder communication about open banking right, starting way before midnight.

Is your ‘story good to tell’ in an evolving marketplace?

Four companies announced their intent to list in recent weeks and at the eleventh hour, all four IPOs had been shelved. In the days and weeks to come, we will no doubt see countless explanations about why these companies – that are heavily advised by some of the country’s most eminent listing experts – have failed to secure sufficient demand and support for their respective bookbuilds to take their stocks public.
tony boyd says in his article this week – that “fund managers have been happy to rush into companies with good stories to tell”.
These recent failed IPOs reinforce the need to address the nagging question that financial communicators have no doubt tried to push to the top of the agenda in those endless company-advisers transaction meetings. The question is what makes an equity story compelling and good to tell prospective investors in this evermore noisy marketplace?
It goes without saying that companies considering going public should focus on the presentation of their current operations and financials as well as their future growth options in their investment proposition and equity story.
However, considering the Latitude IPO for example, the financial attributes and performance indicators alone were not sufficient to address the valuation gap related to the potential growth opportunities and overall future sustainability of the business. This gap between the company view and the market view effectively led to a breakdown of communication between the investors and bankers on the case despite earlier positive signs of commitment.
In the case of WeWork, doubts were cast regarding the operations and financials of the company which affected its overall equity story. But it was the softer non-financial matters related to the credibility of the management particularly the CEO and the quality of business processes that ultimately kicked the bucket for the company.
The undeniable fact is that the Australian capital market is undergoing a watershed transition period where softer non-financial attributes have taken centre stage for institutional and sophisticated investors. At the same time foreign investors have made clear their positioning on alignment of ESG and other components of responsible investment strategies that look beyond the financials of companies.
In this new market reality, a ‘good story to tell’ should be by design.
Companies intending to list, or to engage the capital market, need to up their game and present a better narrative and equity story that consists of all the traditional financials but also clearly covers its non-financial attributes. These may be the long-term vision for a sustainable business, the quality and credibility of its management, its people and culture strategy and succession planning, as well as innovation, scalable capabilities, quality of business processes and execution on corporate strategies. The story should also address clearly and definitively the influences that affect the sector and market overall.
This type of holistic equity story is what investors want to hear to help ease their process of separating the wheat from the chaff when committing capital to IPO suitors.

Why pursue a career in financial communications? – Thoughts from a PR grad

Picture this: I am eight months into my graduate position at Honner working as an Account Coordinator in Sydney’s bustling CBD. One weekend, I’m visiting my family and friends in Brisbane, attempting to explain to them (yet again) what my job actually is.

The top three responses thrown back at me are:

  1. “I don’t actually understand what you do.”
  2. “Your job sounds intense!”
  3. “Can you please clarify – isn’t PR the same as marketing / advertising?”

These almost automatic responses have led me to believe that a) my family and friends have not been paying attention to my detailedpost-work-debrief-phone-calls as I walk home, or b) it’s difficult to articulate to those outside our industry what we do on a daily basis. The latter conclusion is not helpful for all those university students and almost graduates who may be interested in working with us but just don’t know that such a niche field exists.

If you are a PR student or grad reading this, you might think you have a pretty good understanding of what a job in PR will involve, but you might not have thought of specialising in financial services PR, and what that would be like.

In light of this, for all those reading wherever you are in the world, let me break down these questions for you.

How I found myself working in financial PR and what the Account Coordinator role is.

After getting through the struggles of university, I completed a Bachelor of Business, majoring in Public Relations and Economics. It was a pairing a lot of people were sceptical about, and at times I thought the goal of marrying both disciplines would be unattainable.

My worries subsided when I was offered a position at Honner. I was discovered on LinkedIn through a mutual connection (and realised the platform really is a form of resume in this digital age) and was soon embarking on an exciting new chapter in “the big smoke”.

For those on the brink of entering the workforce for the first time, I implore you to appreciate the (what can seem mundane) tasks that you are given each day, as they can be a stepping stone to a bigger lesson down the track.

Some examples of this would be compiling media lists, clipping coverage or completing a media search for a new business client.

From these tasks alone, you learn the following things:

  • Which journalists are currently at different publications (something you need to stay on top of as this changes frequently)
  • What beats those journalists are writing on
  • Timely industry announcements and news
  • Activity that’s happening within the business outside your scope

My role has expanded over time as I have gained more experience. I now attend regular client facing meetings, write media releases announcing executive appointments, assist with drafting posts for the social media channels of my clients and Honner, take part in presenting PR campaigns and have a role in creating new business projects.

Since beginning my career journey at Honner, I have grown immensely (both professionally and personally) and continue to increase my skillset and knowledge with the support of my peers, mentors and senior leadership team.

Financial PR might sound intense, but it isn’t as scary as you think!

So you’re thinking PR (enter thoughts of Roxy Jacenko) and finance (and now Wolf of Wall Street). That’s a whole lot of intensity meshed together in one job. Working at Honner opened my eyes to how not scary financial PR is.

If fashion and makeup is the extent of your knowledge of PR, then you would be glad to know that it’s possible to incorporate that into working in a finance related job that might not seem so glitz and glam. Dress to impress!

The most intense part of the job is having to keep up with the fast paced, high performance industry that leaves little room for errors. However we’re all human, so when you do make those errors, it’s a steep learning curve.

As much as it is intense, it is exciting – think chasing stock market prices moving, crisis communications, having coffees with some of the country’s best journalists, client anniversary events, roundtable media lunches with high level executives… my heart beats faster just thinking about it all.

Our clients include some of the world’s biggest asset managers and top Australian banks and superfunds, as well as innovative fintech companies that are transforming the landscape. This is an industry where our clients are doing mutli-million dollar deals, responsible for making sure that hundreds of thousands of retirees are able to have a secure financial future, and even engineering financial products that have the capacity to help solve some of the world’s biggest problems, like climate change.

On top of this, Honner has a great team culture. In fact, we recently celebrated our team quarterly social event at ten pin bowling.

Why you should specialise in financial public relations and how they work together with marketing and advertisings

The three areas of communication are largely separate but often cross paths with each other. Unlike advertisers and marketers, in public relations we aim to persuade our audiences through the spectrum of owned and earned media and digital channels. This Forbes article sums it up quite nicely. Honner is a great example of how public relations can work alongside the other two specialities as we expanded our services to be an integrated communications firm with the addition of a marketing expert.

Each day working in financial public relations brings something new to the table.

If working at Honner sounds interesting to you, email with your resume and get in touch!