We made it. That’s the feeling many of us share after a year like 2020. There is a lot of change ahead, and much to look forward to — here’s a quick rundown of my insights into what 2021 will bring.
Rolling back the pandemic
The rollout of the COVID-19 vaccine to the general population was expected to be in full swing by summer. In the US the vaccine rollout is behind schedule and the Biden administration will need to address this as one of their first major problems to remedy. As restrictions ease across the world, we can predict some major shifts in travel, working practices, entertainment and productivity. We’ll see increased asset flows to mid-sized firms as in-person meetings begin once again. By Q4, we expect most people to have had their second immunization shot, with the resumption of meetings benefitting small and mid-size firms the most. Virtual events will continue to thrive, of course, as they offer the ability to attend more events in less time — virtual meetings and virtual cap intro events have proven their case over and over again, and the benefits of efficiency, flexibility and value will continue into the future.
Democratic fiscal policy
Joe Biden’s victory for the Democrats will see a significant pivot from the America first strategy of his predecessor. We expect greater engagement of issues on the global stage, from the Paris Accord to peace agreements. As Biden selects and installs his team of advisors and chiefs, we are likely to see continuity with the aims of the Obama administration.
Environmental, Social & Governance investment
We believe that the growth in ESG investment is a given for 2021, and that responsible returns will keep coming from this direction. The US is reaching a tipping point with ESG as a policy. Covid-19 and social justice movements will be a catalyst for the pension funds, endowment foundations and sovereign wealth funds, who will employ ESG principles to make a meaningful impact.
Global Outlook
Every nation has suffered in some way, and recovery will advance at local speeds. The slowing of global trade, disrupted by Covid and dampened by falling demand and consumer uncertainty, will damage specific industries — those with longevity will be planning ahead, diversifying and realigning their strategies already. However, pent up demand is likely significant across many areas of the economy and may be realized if the vaccine is deployed effectively. Keep an eye on alternative investment growth driven by healthcare institutions, for instance.
An aging US population and advances in technology make this one of the fastest-growing investor segments. With multi-billion dollar asset pools, these organizations have built up sophisticated investment departments.
Tech and Antitrust
Will 2021 be the year that the big names break up? While it’s tempting to think of a tech scene of improved competitiveness, it’s unlikely that the rules will change anytime soon. Trump’s calamitous exit from power threw a light on the ethical dilemmas of social media, app stores and hosting firms: will momentum for change grow, or will the giants of tech reposition themselves just enough to stave off legislative demands? We await the coming year with interest, and our finger paused over the ‘refresh’ button.
– Ron Biscardi, CEO, iConnections
