IN­TER­VIEW: JUNE FELIX OF IG GROUP

June Felix has helped IG Group weather the coron­avirus cri­sis to emerge stronger than ever, writes Michael O’Dwyer

The Daily Telegraph - Business - - Front Page -

The Covid-19 pan­demic might have laid waste to the global econ­omy, but IG Group has done rather well out of the tur­moil. Busi­ness at the on­line trad­ing plat­form has boomed while nearly 2,000 staff logged on from their homes around the world.

Em­ploy­ees were treated to a bumper £42m bonus round in April, net trad­ing rev­enue from March to May more than dou­bled com­pared with the same pe­riod last year and the shares are up 30pc in the past 12 months.

For IG and ri­val spread bet­ting firms such as CMC Mar­kets and Plus500, wild swings in fi­nan­cial mar­kets cap­tured the imag­i­na­tion of in­vestors and raised the prospect of big gains – and losses.

June Felix, IG’s boss since Oc­to­ber 2018, has had a front-row seat for the cri­sis that helped the firm’s pre-tax prof­its soar 52pc to £296m in the 12 months to May.

“It’s been re­ally quite in­tense,” she says. “You’ve had quan­ti­ta­tive eas­ing, oil go­ing neg­a­tive. You know, I’m re­ally proud of the fact that we were one of the few plat­forms that could price and trade when oil went neg­a­tive. It’s been a se­ries of tre­mors and shocks.”

As well as oil fu­tures con­tracts briefly trad­ing at be­low zero amid a global glut, the FTSE 100 fell about a third dur­ing the pan­demic be­fore mount­ing a re­cov­ery. The pound hit a 35-year low and UK bond yields went neg­a­tive for the first time. Felix, who

‘Or­ganic chem­istry was my favourite sub­ject, which is very geeky, but it taught you to work back­wards’

‘If there are 10 things that women need to have in or­der to do the job, they’ll want to be per­fect in all 10’

worked in Hong Kong dur­ing the han­dover from the UK to China and near New York’s Twin Tow­ers at the time of Septem­ber 11, says IG had prac­tised for ma­jor dis­rup­tion.

One day a year, each of­fice would shut en­tirely and ev­ery­one would work from home in case a build­ing was ren­dered in­op­er­a­ble.

“That’s al­most like a fire drill,” she says. “So when we had to do it, there was that knowl­edge and com­fort, and there wasn’t the anx­i­ety.”

That was just as well. In March, the FTSE 250 firm ex­pe­ri­enced three times its av­er­age trad­ing vol­umes from the same month last year.

But its boss is al­ready look­ing to the next chal­lenge. Speak­ing from her Lon­don home, the for­mer head of IBM’s bank­ing and fi­nan­cial mar­kets di­vi­sion says she wants to know what IG can learn from its pan­demic re­sponse so it can han­dle the next cri­sis bet­ter. Felix says she likes to have a plan. “I am out­come-fo­cused. Where do I want to be and how do I work back­wards [to see how to get there]? Or­ganic chem­istry was my favourite sub­ject, which is very geeky and stupid, but it taught you to work back­wards.”

Her science back­ground as a chem­i­cal en­gi­neer­ing grad­u­ate puts her in the mi­nor­ity among FTSE chief ex­ec­u­tives. So too does her eth­nic­ity. Her fa­ther, an en­gi­neer, em­i­grated from China to the US, where he met her Chi­nese mother.

The Black Lives Mat­ter protests in re­cent months have put racism and equal­ity to the fore­front of the po­lit­i­cal and busi­ness agenda. What should com­pa­nies be do­ing to tackle the prob­lem?

Felix sighs. ”It’s a long con­ver­sa­tion but ba­si­cally I be­lieve in mer­i­toc­racy.” Chang­ing at­ti­tudes and as­sump­tions is hard, she says. “Ev­ery­body has pre­con­ceived no­tions about in­di­vid­u­als. As a Chi­nese woman, peo­ple thought [I] had to be meek and not speak up.”

Through­out her ca­reer, which has taken her from Deutsche Bank and Cit­i­group to pay­ments firm Ver­i­fone, col­leagues of­ten seemed sur­prised when she spoke up and ex­pressed a strong point of view, she says.

Mov­ing past those prej­u­dices takes time, Felix ar­gues, com­par­ing the process to phys­i­cal train­ing.

“Most peo­ple can’t just put on ten­nis shoes and do a marathon. You have to get used to think­ing it’s nor­mal to run at six o’clock in the morn­ing.”

Be­ing a woman places Felix in another mi­nor­ity among her peers. As of last Novem­ber there were only 14 women in charge of FTSE 350 com­pa­nies, ac­cord­ing to the Hamp­tonAlexan­der Re­view.

More com­pa­nies are adopt­ing di­ver­sity tar­gets to im­prove rep­re­sen­ta­tion of women and peo­ple from mi­nor­ity groups in se­nior roles. Are tar­gets, or even manda­tory quo­tas, the way to im­prove equal­ity? “No one wants to be a to­ken. In the past, it prob­a­bly was help­ful and it still can be used as a guide but no­body wants to be a to­ken, so this is the con­flict.

“You shouldn’t be pro­mot­ing peo­ple that aren’t able to do the job,” she says, but adds there are other con­sid­er­a­tions that com­pa­nies must fac­tor in.

“If there are 10 things that [women] need to have in or­der to do the job, they’ll want to be per­fect in all 10.”

What is that num­ber for a man? “It’s less,” Felix vol­un­teers diplo­mat­i­cally. “You ask any head­hunter – they’ll tell you. If you change the name on the ré­sumé from Han­nah to Hank, it’s quite in­ter­est­ing.”

Im­prov­ing gen­der bal­ance among com­pany bosses will re­quire “con­certed ef­fort” on all sides, she says. Women need to “hang in there” and so­ci­ety must recog­nise the value of di­verse lead­er­ship of or­gan­i­sa­tions.

IG’s own em­ployee base is 69pc male, match­ing Felix’s de­scrip­tion of which the changes were in­tro­duced. “There were a lot of bad prac­tices out there and it was ap­pro­pri­ate for the reg­u­la­tors to make some ef­fort to en­sure that some of those prac­tices were stopped,” ad­mits Felix, hint­ing that reg­u­la­tors could also have done more to clamp down on some of IG’s ri­vals. “What they de­cided to do was re­ally im­pact the cat­e­gory or the prod­uct as op­posed to go­ing af­ter the in­di­vid­ual play­ers that par­tic­i­pate in the cat­e­gory.”

The firm in­sists it has strict tests to en­sure clients are wealthy enough and have suf­fi­cient un­der­stand­ing to use its prod­ucts. The ma­jor­ity still lose money but Felix says that, un­like its ri­vals, IG doesn’t have a fi­nan­cial in­ter­est in its clients los­ing money. “We don’t profit from their losses. We’re ex­e­cu­tion-only.”

Felix’s strat­egy is to make IG a global player and diver­sify its prod­uct range so clients will in­vest more of their port­fo­lios through IG.

New prod­ucts in­clude IG Prime, a bro­ker­age ser­vice for institutio­nal in­vestors, while fo­cus­ing on tech­nol­ogy could al­low the firm to achieve scale. Asked to de­scribe IG’s busi­ness in three words, she says it is a “tech­nol­ogy-en­abled fi­nan­cial ser­vices com­pany”.

The push to go global has meant tai­lor­ing its mar­ket­ing for lo­cal au­di­ences. Ja­panese cus­tomers want more de­tail from the in­vest­ment app than those in the UK, for ex­am­ple.

As for the UK’s stand­ing as a global fi­nan­cial hub, Felix be­lieves it can re­tain that sta­tus post-Brexit pro­vided there is po­lit­i­cal will to pri­ori­tise the sec­tor. the firm’s typ­i­cal client. “They’re 30 to 50 years old. They’re men. They are wealthy, they’re well ed­u­cated. They’re as­tute in fi­nan­cial mar­kets. They’re either in fi­nan­cial ser­vices or en­trepreneur­s or in tech­nol­ogy.”

IG’s client base is grow­ing but Felix is keen to break away from the spread bet­ting in­dus­try’s im­age of cater­ing to un­in­formed pun­ters to fo­cus on higher-end and pro­fes­sional clients.

Hav­ing served as a non-ex­ec­u­tive di­rec­tor at IG since 2015, she was brought in to steer the com­pany through a reg­u­la­tory crack­down in 2018 that up­ended the busi­ness model.

Alarmed at the big losses be­ing run up by some cus­tomers, Euro­pean and Bri­tish reg­u­la­tors clamped down on spread bet­ters, in­clud­ing through in­dus­try-wide re­stric­tions on con­tracts for dif­fer­ence (CFDs), fi­nan­cial in­stru­ments that al­low in­vestors to bet on the price of a share, com­mod­ity or cur­rency with­out own­ing the un­der­ly­ing as­set.

Lever­aged bets al­low cus­tomers to take big­ger po­si­tions, mag­ni­fy­ing their gains or losses. IG’s pre-tax prof­its fell 31pc for the fi­nan­cial year in

June Felix has been in charge of IG Group since Oc­to­ber 2018, and has guided the spread bet­ter through ‘tre­mors and shocks’

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