Elizabeth Dillon has more than 20 years of experience at Pictet Asset Management, a pioneer in the independent wealth and asset management industry, and a heritage spanning more than 200 years. Before being appointed as CEO of Pictet Asset Management Corp in 2021, she served in both London and Geneva. Elizabeth spearheads the firm’s U.S. operations and growth strategy, with a keen focus on ESG/sustainability, and she established Pictet’s first U.S. presence in New York City.
Russ Alan Prince: Tell us about Pictet Asset Management and the reasons for your expansion into the U.S. in 2021.
Elizabeth Dillon: Pictet Asset Management is a leading independent asset manager in Europe, overseeing over $200 billion in assets under management. Founded in 1805, Pictet operates through a partnership structure, which has provided a stable foundation and continuity for our long-term thinking.
While Pictet AM applies a multi-decade mindset and offers an uncompromising focus on the long-term interests of clients, it also demonstrates trailblazing capabilities, and an ability to evolve with the world around us. We offer strategic solutions across thematic equities, ESG investing, emerging markets, multi-asset and alternatives.
The U.S. is a region that Pictet AM has a long history of serving, having conducted business with institutional clients in the U.S. out of our Montreal office since the early 1990s and intermediaries clients out of London since 2004. Over the last five years, we identified the U.S. to be a market of strategic importance and committed further resources to expand our presence in the region. In 2021, we opened a dedicated office in New York City, where our investment and business development teams operate. Opening an office in the U.S. allows us to be close to clients, particularly in times of market turmoil, which is very important to us. We are a global company with a focus on local service.
Our expansion into the U.S. presents an exciting new chapter in Pictet’s narrative, where we can combine our deep expertise in thematic strategies, emerging markets, and responsible investing, our DNA of stability and long-term thinking, and our successful history in Europe, with the energy and dynamism of New York City. As a native New Yorker, I was delighted to return home as the CEO of the U.S. operation, where our team is working to expand our offering of strategic capabilities, as well as focusing on the areas where we can create value for our U.S. clients.
Prince: Pictet Asset Management has been recognized in the Broadridge “Fund Brand 50” survey as a top European Asset Manager for nearly a decade. What do you attribute that success to?
Dillon: Pictet Asset Management has established its reputation as one of the leading European asset management brands, through the recognition of its investment expertise and by offering appealing, and often innovative, investment strategies. We have been ranked the fourth leading asset manager brand in Europe, behind three U.S. giants, Blackrock, JP Morgan and Fidelity, for the past seven years.
While Pictet AM’s successful reputation has been driven in part by its position as the world’s leading thematic equity provider, Pictet AM’s expertise goes beyond thematic equities, with compelling strategies in areas such as emerging debt, multi-asset or alternative investments. However, what is particularly noteworthy about Pictet AM’s brand reputation is its championing of sustainable investment strategies in both equities and bonds. In addition, Pictet AM is committed to working with scientists on research programs to develop a deep understanding of topics such as climate change, water scarcity, global nutrition, and more recently, biodiversity, and establish an investment approach that is focused on science-based targets instead of rhetoric.
Prince: Pictet Asset Management is known in Europe for their thematic and environmentally focused investment expertise, where do you see opportunities now?
Dillon: Our thematic equity strategies capitalize on the megatrends transforming the economy and society, such as digitization, urbanization and environmental degradation. We pioneered the thematic investment approach in the 1990s, launching our biotech strategy in 1995 and our water strategy in 2000. Today, we manage some 66 billion in thematic equities across 15 different strategies.
From the outset, we have always believed that, because of their distinctive characteristics, thematic equities could deliver superior excess returns over the long run. Yet we would say that the case for embracing a thematic approach is arguably stronger today than it was even five years ago. Not least when it comes to environmental investing.
It is our view that thanks to technological advances and new laws and regulations designed to reduce carbon emissions, prospects for companies operating in the clean energy and environmental tech industries are among the brightest across the equity market. The U.S. Inflation Reduction Act, and similar measures being implemented around the globe, should provide a particularly strong boost to the clean energy transition, something our clients are following closely.
Many renewable energy technologies are in any case already achieving economies of scale unthinkable just a few years ago. Today, wind or solar are the cheapest new sources of electricity in countries accounting for around 73% of the world GDP. The firms making this possible form the core of our Clean Energy Transition strategy.
Also, there are companies operating in other sectors of the environmental industrial complex such as water recycling, pollution control, forestry and agriculture that should also see a marked improvement in their valuations. Our Global Environmental Opportunities strategy is designed to identify the most attractive investments right across the environmental value chain. It deploys a unique environmental screening tool known as the Planetary Boundaries framework, developed in 2009 by the Stockholm Resilience Centre at the University of Stockholm, which defines nine quantitative boundaries within which humanity can continue to develop and thrive. By applying this framework, the strategy seeks out the firms developing the products and services that will play a crucial role in placing the world economy on a more sustainable footing.
Russ Alan Prince is the executive director of Private Wealth magazine and chief content officer for High-Net-Worth Genius. He consults with family offices, the wealthy, fast-tracking entrepreneurs and select professionals.
