Audio Coverage

Credit Suisse's Brady Dougan Speaks with Dean Snyder at Management Conference

With hedge funds booming, markets emerging in China and India, and lines blurring between financial vehicles, financial institutions must adapt, according to Credit Suisse Investment Banking CEO Brady Dougan, AB ’81, MBA ‘82

“This industry in particular reinvents itself every twenty years,” Dougan said. “Eighty percent of the revenues that we make today were businesses that didn’t exist twenty years ago.” Dougan shared his thoughts with Dean Edward Snyder at the 54th annual Management Conference May 19, an event that drew nearly 1,000 alumni and friends of Chicago GSB to the Hyatt Regency Chicago for lunch and to Gleacher Center for afternoon panel discussions on a range of issues.

Business strategies and customer bases are going to change, so the most important part of management success is having employees who can deal with change, he said. “You have to have really great people [who can adapt].”

Dougan said fast-growing parts of the world will bring “incredibly exciting change.” India is rapidly developing a middle class, and China is changing from having an export-led economy to a consumer, domestic economy. “This is really going to drive a new era in terms of how China interacts with the world,” he said.

“Another good trend is that growth is happening in places like China and India, so we’re actually seeing a better redistribution of some of the wealth and the growth around the world,” he said.

Dougan cited statistics that show the world’s resources are distributed disproportionately. While 100 million people are spending money to lose weight, another seven billion basically eat to live, and another four and a half billion don’t know where their next meal will come from. “That distribution is something the world’s financial systems have to do a better job of equalizing,” Dougan said. “Clearly, that’s not sustainable in the long run.”

One way to build value and improve standards of living is to marry microfinance with macrofinance, he said. “Huge capital surpluses” around the world need to be put into microfinance-type businesses, Dougan said. CS has a $400 million fund to do just that. While it is a “very effective” method, a “tremendous” amount more needs to be accomplished in this area, he said.

“We’ve had some government sponsorship,” Dougan said. “But the private sector really needs to pick it up and run with it and drive it. And I think that will increasingly happen.”

—Mary Sue Penn