Refugees can be a welcome boost for companies seeking talent

Quantum Matters – Quantum Culture

Not just another brick in the wall  

“You think you are the messiahs!” cries out Lily, the super-hero of BBC series Devs, to the bosses in charge of the secretive quantum unit.

That slur can just as easily be applied to the Big Tech chiefs, who started out with missions encapsulated in Google’s motto “Do no evil,” yet proceeded to abuse their monopolistic powers, promote addictive behaviours and allow hate speech to flourish.

Can a different culture be created in the newly emerging quantum ecosphere?

This matters to the world. The Quantum Computing market is forecast to be worth $50bn by 2030, only nine years away. The pace of funds into the sector has already accelerated. Data platform The Quantum Insider (TQI) notes that total disclosed capital flows into the sector were $1.9bn in the first half of 2021, compared to $1bn in all of 2020.

And quantum computing’s capacity to change the world for good can best be harnessed through a diverse workforce working in an inclusive culture that supports stakeholder capitalism.

The key challenge – a decent culture – also matters to quantum companies themselves for three reasons: innovation, recruitment and funding.

Innovation

Similar to all nascent sectors, innovation is key to the development of profitable companies producing jobs and goods.

More inclusive companies are 1.7 times more likely to be innovation leaders in their field, according to a Deloitte report. Gender-diverse companies are 15% more likely to outperform their peers, while ethnically diverse ones are 35% more likely, according to a McKinsey report.

Even without citing hosts of corroborating studies, common sense dictates that the wider the range of opinions, the more chances of new ideas arising. The most productive meetings for transformative ideas are often those where disagreements flourish. The flame of innovation is often created out of friction; group think is the result of bonhomie.

Given that human beings have around 188 cognitive biases, ranging from the self-explanatory Familiarity Bias to the Just World Hypothesis, recruiting in one’s own image is difficult to resist. It behoves quantum company CEOs and their colleagues to diversify the mix, adding to the mainly white and male university PhDs and tech executives in order to bolster innovation.

Recruitment

There is a global war for talent in many sectors. Goldman Sachs, an erstwhile golden destination, is seeing some problems in recruitment. And those it does recruit are now surprisingly vocal. Young bankers complained to senior management about their workload earlier this year, a story avidly picked up by the media.

The UK’s mission to attract the best global talent is not helped by its expensive, time-consuming new immigration regime. One well known quantum start-up was forced to set up two subsidiaries in Continental Europe due to Brexit. On the plus side, the company was pleasantly surprised by the response to a recruitment ad there. Unfortunately, this stood in sharp contrast to its UK job advertisement, which received far fewer responses.

Employees and future employees are empowered, and they are demanding workplace cultures that align with their values. Over 85% of Gen Z believe companies should stand for more than just making a profit. Note that at Apple there was a successful petition to dismiss a well-known new hire with a sexist reputation, as well as a public letter demanding flexible return-to-work policies.

And yet, basic prejudice persists. A female student working on her quantum PhD at an Oxbridge university was asked by her professor: “How do you expect to progress if you keep smiling all the time?!”

Oxford Quantum Circuits (OQC) is doing all the right things and reaping the fruits: over 40% of its job applicants are women. One of its latest ads used these phrases: “We aspire to thrive…thanks to your diversity of thoughts and background…We are building quantum computers to enable life changing discoveries.” The company, led by Ilana Wisby, anonymises all the CVs it receives, posts roles on diversity-focused job boards (LBGT+, black engineers and others) and celebrates its new arrivals with photos on social media that highlight its diverse workforce.

Although helpful, a female CEO is not essential to enable a wider recruitment strategy. Cambridge-based Riverlane, for instance, headed by Steve Brierley, lists its first two values as being “supportive” and “collaborative” and posts a friendly group image of its relatively diverse company.

Denise Ruffner and Andre König of Women in Quantum (WIQ) and OneQuantum are the two major protagonists of the move to shake up the look of the industry and widen access. Their fast-growing mentoring schemes, online recruitment fairs and the setting up of free-to-use country chapters – from Zimbabwe to Nepal to Argentina – are inspiring a new generation.

TQD has been highlighting the issue, while The City Quantum Summit in November will host a special panel on the subject.

To create an inclusive culture, the Good Finance Framework is a good place to start. Designed by The Inclusion Initiative’s Director, Associate Professor Grace Lordan at the London School of Economics*, its 10 steps will also help boost staff loyalty and enthusiasm. This is crucial when quantum companies are competing for the best talent against other industries, as well as between themselves.

What is relevant for talent, is just as relevant for funding.

Funding

Political guru Frank Lunz predicts that how you treat your employees will be the single most important issue for companies over the coming years – above sustainability and shareholder returns.

It is an issue institutional investors are grappling with as part of their Environmental, Social and Governance (ESG) criteria.  Regulation will drive it. The US Securities and Exchange Commission (SEC) this year approved a proposal from Nasdaq, the stock market for tech, requiring its listed companies to publish, comply or explain on board diversity. They must have “two diverse directors, one identifying as female and another as an underrepresented minority or LBGTQ+.”

The UK’s Financial Conduct Authority (FCA) has proposals out for consultation on how it can accelerate the pace of meaningful change on Diversity & Inclusion, noting that it is relevant for risk management, good conduct, healthy working cultures and innovation (my italics).

The writing is on the wall: whether public or private, investors are going to be leading a push for the right cultures. Getting ahead of the game is the best bet for any quantum company.

Build back better is a much over-used phrase. But it encapsulates the desire to avoid the mistakes of the past. In the case of the quantum ecosphere, steering clear of Big Tech’s grave errors to create a better world, both within quantum companies and through quantum computing, is key.

*To note, the author is Co-Director of LSE’s The Inclusion Initiative for the City.

The City Quantum Summit at the Mansion House on November 10th is hosted by the Lord Mayor of the City of London and Redcliffe Advisory, and supported by the National Quantum Computing Centre (NQCC) with TQD as media partner. Diversity and Inclusion is at its core. Register here

The City’s New Face

Marrying public and private ethics

Does it matter what the chattering classes are talking about? From the 1970s, column inches and speeches were dominated by Chicago economist Milton Friedman and the principle that companies should focus on shareholder returns and forget about suppliers, customers and community – they would benefit tangentially. This was famously encapsulated by legendary American CEO Al Dunlap´s 1990s outburst: “The most ridiculous term heard in boardrooms today is stakeholders. How much did they pay for their stake?”

Shareholder primacy and the Washington Consensus on economic growth had their time in the sun. Today, a couple of years after the election of Donald Trump and the Brexit referendum, we see an avalanche of books with titles like “Democracy and Prosperity – the Reinvention of Capitalism in a Turbulent Century” and articles in the mainstream press headlined “Populists have a point, the system has to change.”

At the end of last month Christine Lagarde, Managing Director of the IMF, quoted Aristotle on the need for a personal sense of purpose to be linked to a social purpose. Speaking in the heart of the City at the annual World Traders’ Tacitus lecture she called for the financial sector to develop “broader social responsibility.”

She noted that Fintech is producing cheaper and more accessible products to drive an inclusion revolution; that a higher share of women on boards is correlated to more financial stability and sustainable growth; that the younger generations prefer to invest in financial instruments with social impact.

Today, achieving social cohesion in our societies is key. The widening of the net of financial and societal gains of the last forty years is essential to underpin democracy and sensible government.

How should the corporate and financial sector react? Here are four suggestions for companies already on this journey, and for those who are being left behind.

1. Add a dollop of emotion to any policy changes. Making the world a better place is no longer the monopoly of charitable bodies and starry-eyed university students. Company actions need to be marketed emotionally as well as financially, not least because so many experts have been found wanting and ‘facts’ are under attack from the echo
   chamber of news.
   

2. The audience is both internal and external. Millennials and Generation Z – those who are working for your company, those you want to be working for your company. Politicians – who after the financial crisis dare not mention the financial sector as a source of growth or responsible capitalism. Investors – often cited as a barrier to change, because of their short time horizons. They are altering as well, ranging from Black Rock Chief Executive Larry Fink’s 2018 letter to CEOs calling on them to make positive contributions to society, to a family office that handed nearly a billion dollars to a Swiss private bank with the proviso that the bank itself must have a sustainable culture or the money would be withdrawn.

3. Be ahead of the curve by making clear that the costs involved in becoming sustainable are investments in growth opportunities. And that change cannot be immediate. Unilever is a much-cited and much-deserved, case in point. The consumer goods company proudly notes that on average it pays 27% corporate tax worldwide. It is very open about its shortcomings. For example, they overcame the innate contradiction in producing Vaseline, an extract of crude oil, by setting up a health initiative to send the crucial product plus health kits to disaster zones.
   

4. Diversity & Inclusion may sound like politically correct balderdash. Not true. Inclusion means creating an atmosphere where all can thrive and be themselves. This includes Black, Asian and minority ethnic (BAME), older workers and the white middle-aged men who form the backbone of the City and are wondering where they belong in this new world. Don’t leave them out.
   

5. Measure the impact of changes in diverse ways, such as lowering company risk, increasing well-being (an OECD-approved policy), helping achieve the UN’s Sustainable Development Goals and boosting employee loyalty. Stakeholders will all have a specific measure that engages them more than others.

To reach middle age and find yourself and your peers veering leftwards politically is a shock, not least because of that well-known phrase about a young person who isn’t a socialist hasn’t got a heart; an old person who is a socialist hasn’t got a head. But this isn’t socialism. It doesn’t mean voting for Jeremy Corbyn in the UK or Bernie Sanders in the US. It doesn’t mean throwing profits and return on equity out the window.

It does mean marrying private and public ethics. The divide in the moral codes between home and business is over. In the words of Christine Lagarde, the financial industry can be economically rewarding and ethically right.