Speaker 1:
From the Library of the New York Stock Exchange at the corner of Wall and Broad Streets in New York City, you're Inside the ICE House. Our podcast from Intercontinental Exchange on markets, leadership, and vision and global business, the dream drivers that have made the NYSC an indispensable institution of global growth for over 225 years. Each week we feature stories of those who hatch plans, create jobs, and harness the engine of capitalism right here, right now at the NYSE and at ICE's exchanges and clearinghouses around the world. And now, welcome Inside the ICE House.
Chris Edmonds:
Our capacity to achieve success is intricately intertwined with the quality of relationships we cultivate throughout our lives. These relationships span a spectrum encompassing not just familiar ties, but also friendships, mentorships, and professional connections. It's within these interwoven networks that we find support, guidance, and opportunities for growth personally and professionally. Within the realm of wealth management, the significance of nurturing robust relationships cannot be overstated. Clients place an immense amount of trust in their advisors, confiding to them the responsibilities of safeguarding and enhancing their financial assets.
This trust is founded on the belief that experienced professionals possess the knowledge and acumen required to preserve and grow their wealth effectively. Ensuring that clients get rewarded for their trust, at BMO NYSC, ticker symbol BMO, is our guest today, Shannon Kennedy, CEO of BMO Wealth Management, US. With a career spanning over 30 years and diverse experiences, Shannon has dedicated herself to serving affluent individuals, families, and family offices. Her expertise lies in helping clients grow their funds strategically, catering to their immediate needs, while also planning for the future. Throughout her journey, Shannon has honed her skills in wealth management, focusing on each client's unique goals and aspirations. Her commitment to excellence and her track record of success makes her a valuable voice in the realm of financial stewardship and wealth growth, as well as preservation.
On today's episode, Shannon and I will discuss her career, her arrival to BMO in 2019, and the transition into her current role. We'll discuss how wealth management has evolved over the last decade and how she and her colleagues at BMO provide that personal touch to every one of their clients. Our conversation with Shannon Kennedy, CEO of BMO Wealth Management, US is coming up right after this.
Speaker 3:
Connecting the opportunity is just part of the hustle.
Speaker 4:
Opportunity is using data to create a competitive advantage.
Speaker 5:
It's raising capital to help companies change the world.
Speaker 6:
It's making complicated financial concepts seem simple.
Speaker 7:
Opportunity is making the dream of home ownership a reality.
Speaker 8:
Writing new rules and redefining the game.
Speaker 9:
And driving the world forward to a greener energy future.
Speaker 10:
Opportunity is setting a goal.
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And charting a course to get there.
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Sometimes the only thing standing between you and opportunity is someone who can make the connection.
Speaker 13:
At ICE, we connect people to opportunity.
Chris Edmonds:
Welcome back. Remember to subscribe wherever you listen and rate us on Apple Podcasts so others know where to find us.
Our guest today, Shannon Kennedy, is CEO of BMO Wealth Management US and has served in that role since July of last year. With over 30 years of experience, Shannon has spent the last five at BMO and prior to her current role was global president of BMO Family Office. Before joining in 2019, she spent six years with BNY Mellon, that's NYSE, ticker symbol BK, and over 25 years at Northern Trust.
Shannon, thanks so much for joining us at Inside the ICE House.
Shannon Kennedy:
Thanks, Chris. It's great to be here.
Chris Edmonds:
Well, we'll get started with some fun, easy questions in the world that you live in. Give us a little idea, given your extensive experience working with the affluent individuals and families over the last three decades, you understand wealth extends beyond financial assets. But in the context of your work, how do you personally define wealth?
Shannon Kennedy:
So not so easy of a question, actually. What I would say is I worked with billionaire families for several years and wealth is amplified. You can be your truest self, I guess, when you have wealth. And so if you're kind and generous and philanthropic, you're very, very kind and generous and philanthropic. But if you're crabby and unpleasant to be around, you can be amplified and magnified in that way as well. And the way that we could always tell is when we worked with their employees, if they had very quick turnover, you knew that the principal, the matriarch or the patriarch, was probably not the kindest of people.
But basically, with wealth, there's kind of the easy thing is four pillars. You try to acquire it, protect it, grow it, and then give it away. But as you really look into wealth management as you've acquired it, I think part of it is looking at financial assets and how you've accumulated those. Intellectual capital, your knowledge, your expertise, whether you're a business owner or you're an owner of money management. Your social capital and how you engage and give back to the community. And then finally, cultural capital. And that's really family and family values. And I think wealth can be very comforting when you have it, but it also can be really scary.
In fact, I just met one of our clients who was from the Midwest and from a very middle-income family and moved to California, went to Stanford and she and her husband met at a startup and it would be a startup that you would all know. And then they went to another startup that everyone would know, and he's now a CFO of another technology company. And she came into significant wealth and she just wrote a book called The Memoir of Wealth because she felt like she had no place to go, no place to speak about it. Talking about money is often taboo. She didn't know if people would feel like she was bragging or if they would ask her for money. And so it can definitely open a lot of doors, but it also can be a huge responsibility when you've accumulated significant wealth.
Chris Edmonds:
It's interesting, I think one of the first stories you shared with me at one part of your career, someone to have the opportunity to work with you at that time had to have, I think the number was like north of 500 million in liquid assets or something like that. And I remember you were transitioning to a different role when you told me that story and the number got smaller than that.
Shannon Kennedy:
Yes.
Chris Edmonds:
We'll leave it at that. Does it change over time or are the principles the same of how you manage that social, emotional, and intellectual wealth management, because you got to hit all three of them in order to have that positive client experience that you're looking to provide.
Shannon Kennedy:
Yeah, it is always changing, because our lives change. And so things that influence it are perhaps you get divorced or you inherit additional wealth, or if you're a business owner and your whole identity has been that business, and many consider a business like a child, once that child is sold or infused with private equity, all of a sudden, your identity seems to be lost and you don't have that particular identity. You're now an owner of financial assets, which is maybe not as fun as whatever widgets you were making or whatever you were selling. So it absolutely continuously changes. And we do a lot of work with families just on communication exercises. It really doesn't matter how much money you have, we all have our issues within our families. Some have harder issues than others. And that's often why people will create trust agreements because they might have some family members that they are not confident can manage the wealth responsibly after a matriarch or patriarch can pass away.
And that's really where fiduciaries, firms that manage with trust agreements, really can play a significant role because they can help those children, I guess so to speak, from the grave, to help the parents to maintain the values that they've put in place. So it's always kind of changing. It's not a set it and forget it business. It's one that you just have to keep asking clients what are they going to buy, what are they doing, what's happening in their lives? Are they getting older? Do they have health issues? So it makes it more fun, I guess.
Chris Edmonds:
Well, you had the opportunity to work for a number of the iconic brands within the wealth management space throughout your career. How do you see the opportunity at BMO Wealth being a different experience for the clients that are out there today and how do you make sure that you and the team every day deliver that experience that is above and beyond? Certainly, at ICE, we're looking to provide an incredible positive user experience, but how do you separate that from where the competition is on the street and how you earn that trust and ultimately the opportunity to work with these families?
Shannon Kennedy:
Yeah, it started out with how you began the program, which this is a relationship of trust and there's no book of wealthy people that we can try to call and obtain clients. It's a distributive business, so when clients come to us and they have money, they pay taxes, they buy things. Hopefully, we can provide a loan or they get divorced, pass away. Money is always leaving the bank and so we need to have really great people that can develop a very, very strong relationship and a relationship so strong that they feel compelled to introduce us to other people like themselves. But I think with BMO, what sets us apart really starts with our purpose. And we're a purpose-led company, which is we boldly grow the good in business and in life. And so we are focused on, obviously, answering to our shareholders, but we also feel a deep commitment to the community. And so there's really three areas that we focus on.
One is thriving economy, the other is zero barriers to inclusion, and the third is sustainability. So fun fact, we actually have a climate institute in Canada and a lot of people might ask, well, hold on, you actually lend money to that industry, which we do, but we also can influence their sustainability laws and what they're focusing on. For zero barriers to inclusion, we're probably one of the few companies that have over 50% of our board women on the New York Stock Exchange. In fact, I think last year, there was still more CEOs named John than there were women CEOs, which is pretty pathetic. But 40% of our leaders are women, and so that really speaks to a lot of women who are looking for money managers. And then the third is really to have a thriving economy.
We deeply believe that we need to allow opportunity for all. So there's been 40 billion earmarked there where we invest and or lend to women or minority businesses. So it kind of starts there. And I think when people are picking wealth managers, just like what you're seeing in investments where they want to align their investments with their values, they want to find firms that value the same things they do. So we just acquired Bank of the West in California, and I can tell, geographically, those clients are very concerned about sustainability when you compare it really to the Midwest or the East Coast. So all of the money and the 300 billion we have in sustainable finance is something that speaks to them. And so that's a value that they align with so they'll be more likely to pick BMO. But we also manage as a fiduciary, so that basically means we must have a duty of loyalty to our clients and we must do what's in their best interest. So we sit on the same side of the table as our clients.
And the wonderful thing is BMO is an enterprise bank, so different than Northern Trust and Bank of New York who are really global custodians. BMO is not a global custodian. I'm one of the top 10 North American banks. So we have a middle market investment bank, we have retail banking, we have commercial banking, we have business banking. And so all of those other areas we can tap into to help our clients fulfill other financial needs that they have.
Chris Edmonds:
Well, it's interesting to bring that up. First, I would have to highlight as well, we share that on the leadership side because our board is 60% plus women on that here at ICE.
Shannon Kennedy:
Impressive. I love it.
Chris Edmonds:
We've been that and taught that as well. But you talk about those different parts of the bank working together. The question I would ask you, do you ever see that create conflict as you're trying to serve a client? You have a given client who has a negative experience with one part of the bank or not, that then all of a sudden becomes a problem for you and the team on the wealth side to navigate through.
Shannon Kennedy:
What I would say is we have a motto at BMO, which is one client. Every other institution that I've worked with has also had that in one way or the other. The difference is at the very top of the house is a multi-disciplined one client steer co, and then there's one client councils throughout every single region. And we're always talking about what can we do to help our clients in a better way, so it's really mostly about all of them. But of course, there can be times where... I can give you a perfect example where we have a credit card. We have credit cards, and we had a client that was in Europe and forgot to tell us they were traveling. And so with credit cards, all of a sudden, it looks like fraud and so shut the credit card down and they were not at all happy.
And often, it's difficult because you don't want one small part of the relationship to affect an enormous part of their wealth management experience, but all we can do is develop that emotional currency with clients while we're working with them, one where they know that we're trying to do everything we can to help them, which buys us some forgiveness in times when we stumble. We're all human and mistakes are going to happen, but what I say is you've got to have that emotional currency built in with these clients in order to be forgiven because a mistake probably will happen at some point.
Chris Edmonds:
Yeah, we're not perfect and nor is technology, by the way. So it's-
Shannon Kennedy:
That's true. We love technology.
Chris Edmonds:
It's something we have to manage through and have those relationships and value that. So you talked about the optimal client experience, how you all address that and stay after it from the top down. I got to ask this question, share something of a strange request, because I got to believe in all that you all provide in the Wealth Center, that you're the first phone call that some of these families will make or some of the clients make to you directly and say, "I need X done." And that's maybe something you all have never had to do before, that was the first time you had to do it in this opportunity. How does that happen on the other end of the phone when you get that strange request that is new territory? Do you look at the phone and go, "What do I do now?" Is there a mobilization of a team? Give us a little one side, and obviously, no personal details, but I don't know, do you move boats and airplanes and art?
Shannon Kennedy:
Yes. We actually had to... And one story is there was a client who had a large yacht in Monte Carlo and the team had to fly out to put the technology app into the boat. So they were very happy with that because they all got a beautiful trip out of it. But they were also installing the tech on the boat. But often the craziest ones come from estate administration, so I was a probate and a guardian administrator at one point. In guardian administration, it's often a very sad story where minors are, there's some kind of medical malpractice that happens and it's typically at birth. And so the child ends up having cerebral palsy or something very sad and a lawsuit ensues. And much to the parents' surprise, the guardian of the estate is often not them. They're the guardian of the person, of course, but when it's significant sums of money, often a fiduciary is appointed by the courts. And there's a whole host of reasons that I won't go into why, but there's a reason why you would do that.
But there was one child who's mother had passed away and it was millions and millions of dollars in a settlement. And so her brothers and sisters were taking care of her. We purchased a house for the family, we buy modified vans, all of that sort of thing. It's all approved by the court and she passed away. And when a minor passes away, they are not 18, so they can't have a will. So you have to utilize what's written in the probate code, which basically says it first goes up to the parents, then it goes to siblings. And so seven fathers, potential fathers, said they were the father. And so we had to exhume the body and do a DNA test. And the funniest part is none of them were the fathers. And so then the siblings were able to get, that's the craziest story. We always say we could write some kind of after school special on that one, but it's usually in the estate area.
I would say having been a probate administrator, you really get to see the impact of how well clients planned during their lifetime. And the biggest mistake, the biggest is they go to estate planning attorney, they fill out wills and trusts and they never fund the trust. And so you might as well use the paper for wallpaper because you have to actually rename and retitle your assets into the name of the trust, otherwise the trust document is not even effective, it's never been funded, but that's kind of the biggest mistake, but you see some crazy stuff in the estate world.
Chris Edmonds:
Interesting. So let's shift gears just a little bit. So you're recruited to come to BMO to run the Family Office business for BMO, and you do that from 2019 until last year. Now you transition to BMO Wealth Management, so a larger team, larger set of responsibilities. How are those positions different? Where's the line of demarcation? How have you felt the transition has gone thus far for you personally?
Shannon Kennedy:
Yeah, so when I started at BMO, if you're talking about going from heading BMO Family Office to heading all of Wealth Management, Family Office is a go-to-market strategy. It's a subsection of wealth management. It's working with clients at 30 million and above, and most of my career has been in the uber-wealthy space. So moving to now managing over a thousand people where we serve clients at 2 million and below, two to 30 and 30 and above, that's kind of our demarcation. It's been a good learning experience for me on how do we continue to improve on the client experience, enhance the client experience. Of course, we do client surveys every year, so we get feedback from them. And really, I think, for me, the focus has been on employees. It's an easy formula for me in this business because it's so relationship-based, is if you have happy and engaged employees, they will service clients in a better way.
If clients are happier, they are better advocates for you and they'll be willing to act as a testimonial or introduce you to their CPA or their attorneys. And then we continue to grow the business. But I think from a strategic standpoint, we always do our strategy five years ahead of time. So I knew the strategy of all of Wealth and then that strategy played into the strategy that I was implementing within BMO Family Office. But there's different KPIs and other metrics. I think what's new is presenting to the board and presenting to regulators. That's new. I'm not going to say that's the most fun part of the job because the regulatory environment has definitely shifted with the failures of a couple of the banks. But those are some of the things that are a little bit different. But I've always stayed curious and taken the wisdom. And thank you for saying 30 years, it's really 38 years of wisdom in this business. I've always taken the wisdom from those other roles and I listen a lot.
Chris Edmonds:
Well, let's listen a little bit more of that wisdom. So undergraduate Loyola in Chicago, and then you find yourself two decades at Northern Trust. Did you know that you were destined for a career in finance?
Shannon Kennedy:
Okay, this is a funny story. So no, I was going to be in physical therapy. And in fact, last week I was at Waubonsee Community College and I received a distinguished alumni award, and I actually went to community college on scholarship, and my high school principal had come to me and said, "I have the scholarship for you." I was totally intent on going to a four-year institution. I was going to go majorly in debt because while my parents were both educators and it was an absolute expectation we would go to college, I didn't qualify for anything. So it's like, okay, go to college, but I don't have any money to go to college. So having that as a gift was tremendous. So went through two years, it was all physical therapy and I was enrolled to go to university for physical therapy when I got a call from a friend whose sister in New York City needed a nanny for the summer.
And so I thought, sounds like a cool thing to do. I will go be a nanny in New York City. And their son worked on Wall Street, and I literally came to Wall Street and I said, it's like angels singing in heaven. I went, "Oh my God, what is this?" I've never been exposed to finances, stocks, bonds, the market, any of it. And just began to have a voracious appetite and trying to learn what it all was before I left. And so went back to Chicago and de-enrolled and then enrolled in Loyola Business and then was selected to participate in a work as you study program, which was Northern Trust. And I worked in their family business unit and that launched a 26-year career there and then moved to BNY and then to BMO. So I had no idea. In fact, I said at the commencement, "Had someone told me in 1985, you would be a head of a wealth management firm. I would've said, I don't know what that means, but I sure would like some wealth."
Chris Edmonds:
So you just mentioned it. So 26 years at Northern Trust. You get recruited away, you leave the balmy city of Chicago, the city of broad shoulders and opportunity, and you go where for BNY?
Shannon Kennedy:
I went to California to Newport Beach, which was absolutely amazing.
Chris Edmonds:
Did you find wealth there?
Shannon Kennedy:
Oh, yes. I mean, crazy. Well, California is what, the fifth largest economy in the world. So there's tremendous wealth there. And that's one of the reasons why we purchased Bank of the West. One of the things I tell people, because people are quite surprised that I left a 26-year career, is I say people leave people not firms, and I won't throw anybody under the bus, but you can often outlive a different boss or someone coming through. But when you work with an individual where you feel unheard or disrespected, you can't control their behavior, you can only really control the decision you make and how you pursue your career after that. And so I left and it was enormously scary. We didn't know anyone in California, but it was the biggest growth opportunity I ever had.
I think my kids learned how to be resilient. They knew they could make new friends. I knew that I could grow a business. I had to grow it, there was so much pressure to be successful. I got tremendously involved in the community and was accepted very quickly in California. In fact, I was just there last week with the Women's Philanthropy Fund and I can now say I proudly own a world record, a group world record, because we built the most hygiene kits. I think it was 6,100 that have ever been built. So I can add that to my resume now.
Chris Edmonds:
Excellent, excellent. So go to California, customer base changes, process doesn't. New firm?
Shannon Kennedy:
Yeah, new firm, same client base. I had left working with single-family offices, so I guess different in that they certainly didn't have $500 million or $200 million. So it was working more with the individuals, I'd say more like 20 or 30 million, but still wealthy enough where you needed to do and help with planning. But my job was really trying to develop the strategy, hire the right individuals with the right wisdom who could get out in the community and be brand ambassadors for us to help grow the business. So it was a little bit different. BNY Mellon is a ginormous global custodian. One in every $5 makes its way through there. Every firm has things that really pronounce their value, but there's enough money for all of us, really, at the end of the day, so I think when I went to BMO, which is more of a commercial capital markets bank, what's wonderful there is all of this one client because there's so much business just within the bank where at BNY and at Northern Trust, you really needed to hunt it a little bit more.
And again, in this business, it's not B2I, there's no phone book that's out there, so it's all relationship driven. It's all by making connections with divorce attorneys, M&A transaction attorneys, maybe executive recruiters, maybe top mortgage brokers. You're trying to get anybody who's in an industry where there's money in motion so that you can get an introduction and have an opportunity to potentially win that client over.
Chris Edmonds:
So here at ICE, we have a large portfolio of data services and tools. I have the great pleasure of leading that team at the moment. When you think about the tools that your team and the bank, obviously, you've talked about how the other parts of the bank and you all work together on behalf of the client, but when you look at those, I need to know something or the client wants to know something, how do you determine the tools that you use to tell that story, to reassure them that the path they're on is consistent with the journey you've laid out for them to travel and things of that nature?
Shannon Kennedy:
Yeah, I think a big part of our business now is data information and data delivery, to be honest, and it has to be accurate. If that is not table stakes and that's not accurate, we don't deserve to be sitting in front of the client. But I think as we analyze different tools, a lot of it starts with, really, planning for us and what's the money for and why are you here and how can we help you? So the systems and the due diligence that we put together is unbelievably robust and it constantly is changing. Right now we're looking at a lot of AI and how can we utilize that. So you can utilize data and prompt advisors on questions they should be asking at a particular life period. Or you use the data because you know their birth dates in there and instead of in the old days where you'd have a tickler or something like that, now it just populates. So we want to be asking our clients questions and being proactive and not reactive to them.
Chris Edmonds:
We appreciate those services that you procure for us, so we're glad to be part of that process and along from the journey. Let's switch gears just a little bit. Outside the office, you publish a monthly newsletter, Sincerely Shannon. Recent articles include, Can Women Have It All? What Was I Made For?, and Doing Gifting Differently. What spurred you to start that?
Shannon Kennedy:
So I started doing Sincerely Shannon in 2013. So when I went to BNY, and the reason was my staff will know this one too, I'm like, when you have change, 13 times. Employees need to hear it at least 13 times before they really start absorbing it. And so we were going through some change at BNY, but it was a communications tool. It was one of the 13 communication tools that I used and I usually would put on the KPIs what we were trying to accomplish and where we were trying to grow. But then I started just humanizing myself because I think it was a region at one point where everyone wasn't in Newport Beach. I then, at one point, had Texas, San Diego, LA, Hawaii, Arizona. So I didn't see everybody all the time and people didn't really know who I was.
So I started just humanizing myself and would get really positive feedback. People and employees would respond back to me like, oh, thank you for sharing that story. So during the pandemic, we were all trying to get staff together and I did a whiskey tasting and a chocolate meditation, and then I challenged the team to do 30 days of gratitude. And I said, I'll send mine out to all of you and you can read it and there's only so many times you can be thankful for the sun or the wind or whatever. So then I was like-
Chris Edmonds:
Especially when you live in California, it's probably a little bit tougher.
Shannon Kennedy:
Well, this was actually in Chicago. I was back in Chicago for the pandemic. But then I just started getting probably more philosophical and just talking about what I thought about that day or the value of our dog and how much he's a unconditional lover and he's sat on your lap, I know [inaudible 00:32:57] when you've been to our home. And then people would share. And then it was just an unintentional, I ran out of things. So I did the 30 days, which then turned into Feel Good Friday. So then every Friday, I would send something out that I felt was inspirational or something I was happy about or something that I would challenge the team to think about. And then I ran out of ideas, to be honest with you. And so I started asking my leaders or other staff members, I would just pick people, "You do Feel Good Friday."
And they had so much rich content. One of our employee's mother passed away and she just talked about how she felt so loved by her other partners. We had another, one of my leaders who was in the hospital for several months and we card bombed him. And he's like, "My wife couldn't visit me and she would just give me five or six cards." He probably got a hundred cards from us. And that's what just really kind of kept me going. So I'm like, this is amazing. This is better than what I could say. So now that I don't do Feel Good Friday anymore, I kind of had this gap where I'm like, oh, I needed another outlet. So just decided, okay, well I'll just do this blog on LinkedIn. And that's how it started. And there's no rhyme or reason. Probably the next blog will be about this podcast and doing a podcast. And I saw The Fearless Girl and I felt like her and I want to take a picture with her when I leave. Oh my God.
Chris Edmonds:
I think we can help make that happen.
Shannon Kennedy:
Yeah, 38 years later where it all started, I'm back here, which who would've thought. It's crazy. It's just reflections on what I think. And I think I have a thousand people who read it, which is crazy, but kind of fun.
Chris Edmonds:
We all care to learn from each other. It's impressive. Your most recent edition was titled April Showers Brings May Flowers: Ignite Change Personally and Professionally This Spring. In it you wrote, "When change happens at work, and it will, you can accept the change or create another opportunity for yourself. To fight change and things you do not control is a waste of your energy." You want to elaborate on that?
Shannon Kennedy:
Yeah, I think earlier in my career I tried to control a lot. Type A, super driven, goal-oriented. And if I felt like something wasn't right, I would fight it, even within work. And I think at some point I'm like, why am I spending so much time on decisions that are not in my control? Decisions like maybe the allocations that you're receiving from finance from some of the other groups or I can't even think of... Well, another time I thought that one of my other leaders needed help because she said she was really busy. And so I really wanted to change a process. So I thought I was helping her. I had great intention, but I had a horrible impact because she felt that I was basically saying she couldn't do her job. So you learn from all of those things.
And I think I mentioned earlier, you get a boss or someone that you work with and it's an untenable situation and either you stay in it, you get a different job at that institution or you go somewhere else. Those are the only you. You're not going to ever change someone else. I think when I finally said, I'm only going to focus on what I can control, that's it. It was liberating. It just was absolutely liberating.
Chris Edmonds:
Now, did you see that same change happen at home or is there a different Shannon in home in the type A and the driven piece of that?
Shannon Kennedy:
Well, you happen to know my husband who is also type A, maybe even more of a drive-
Chris Edmonds:
Maybe the genesis of the question I'm asking-
Shannon Kennedy:
Maybe more of a driver than I am. So I have done, it's not a 360, but where you do something where you're like, here's your work persona and here's your home life persona. And I think probably my marriage persona is a little bit different, and I probably sometimes will take a back seat to my husband who loves a party and loves having people. I'm kind of more of an introvert, to be honest, and he's the exact opposite. So I think he lifts me up in that way. My girls would probably tell you, all I do is work. In fact, one time Anna, my youngest, when Blackberry was around, I was talking to her and she kind of tapped the table. She goes, "Mom, look in my eyes when you're talking to me." I was like, "Oh my gosh, I'm on my phone. This is terrible." So yeah, I'm probably a little bit different at home than I am at work.
Chris Edmonds:
But conscious decision?
Shannon Kennedy:
Yeah.
Chris Edmonds:
Yeah, that's your growth on there. So workforce and how we work has changed significantly over the last 10 years with remote becoming commonplace. Here at ICE, our founder and CEO, Jeff Sprecher encourages and is a huge proponent of in-person collaboration among employees in all parts of our business. In fact, we announced internally that we're moving to four days in the office in September. How has the shifting work landscape impacted, not only your role, but that your team and how they engage with the clients?
Shannon Kennedy:
Yeah, we have asked for three days a week, and I am confident that not a 100% of our employees are following it. I think that being around people, especially early in your career, makes an enormous difference. One of the things we say to families, our values are caught not taught. And I feel like that's the same with work. So much of my growth was listening to someone else on the phone. Maybe it was just one of our portfolio managers talking about the market, or it was a banker talking about what they needed to get a loan completed or just walk around management and seeing what's going on and keeping a pulse on things. And what's crazy to me is I had a girlfriend whose daughter called her recently and said, "I think I'm going to call HR on one of my employees, but I wanted to check with you first."
She's fully remote. And it basically was she'd gone to Michigan and there was a game coming up and one of the employees sent her an email and said, "Hey, go blue." And she told her mom, "Well, I think he's stalking me." And both of us, I said, that is the craziest thing I've ever heard. But I even hear with some of... My daughters are 23 and 27, and their workforce, they feel like you need an appointment when you call them, and I just have never lived in that environment. I think the value of just picking up the phone is better and being in person is probably even better.
So I think that if ICE goes to four days and some other large institutions go to four days, the rest of us will need to probably, and likely will, follow that. And I think it'd probably be a good thing. I still think having some element of flexibility because that seems to be an entitlement now and an expectation and maybe somewhat of a competitive advantage we'll need to provide. But I do think being in-person is definitely something that we need to do more of.
Chris Edmonds:
Look, from our perspective, we life happens, right? There are going to be some times where the electrician can only come in that day and we fully understand that. I think this is an opportunity to discuss maybe less entitlements and how do we work. I need you to pick me up on the team. I got to handle this. And I think we all understand that.
Shannon Kennedy:
I don't know how you build culture remotely. That was why we were all doing these collaborative sessions and trying to get everybody on a screen and a screen's better than, I guess, the phone. Now when we do phone calls without seeing a person, it seems a little odd, doesn't it?
Chris Edmonds:
It does. I'll ask you this question. If someone is on a video call, whatever service you use, what's your policy on camera being on versus camera being off?
Shannon Kennedy:
Oh, if you're with me, camera on.
Chris Edmonds:
Okay, same here.
Shannon Kennedy:
Camera on.
Chris Edmonds:
Same here.
Shannon Kennedy:
What's really strange is I sit on Loyola's board, Loyola University of Chicago, and they are not allowed to have their students be on camera. There's some kind of legal thing, which I think is a shame. But now they're in person, so I guess we don't need to worry about that.
Chris Edmonds:
Let's hope that continues along that.
Shannon Kennedy:
Yeah.
Chris Edmonds:
Give us some advice on how you manage a relationship. Obviously, it's got to get personal. And sometimes we hear, my experience and perspective has been, we hear, see, or experience things with those who we define as our customer and client. That doesn't sit well with us. How do you manage that? Stay focused on the end goal of I'm here to serve, or in some of these cases, those individuals are our friends and they're our client.
Shannon Kennedy:
Yeah, in this business it's definitely not unusual to have a client become a friend because you're asking very personal questions about their health, about their family, about how they feel about money, about what they want to leave to their children, about their parents. You're trying to educate their next-gen. So that can be difficult, but I've never really found that a problem. I think the elements that in building a relationship where I have really no tolerance for is when a client treats one of our employees in a very unkind and bad way. And I don't do it often, I've only fired two clients in my career. And this kind of goes back to being in office.
So we were in office and one of my employees had gone to meet with a very, very wealthy client. And I don't mean difficult clients or clients asking you tough questions. I mean he commented on her appearance in an inappropriate way and just made her feel terrible and devalued. And she came up and I could tell she was upset, but I didn't know she'd been at the client meeting. And I went over and I said, "Is everything okay?" And she burst into tears and I gave her a hug and I asked her what happened. And she told me and I said, "You know what, there is no client worth this unhappiness. You don't deserve that. I'm firing him."
And the effect it had, which I didn't even realize with the entire team because he had been abusive, I would just say verbally abusive for years, and no one... I think we got stuck on, or maybe prior leaders got stuck on the revenue and how much money the client made. But it's like, there's plenty of other clients are out there. And it gets back to employee happiness. And when employees know you have their back, even in situations like that, again, I'm not talking about difficult clients or those asking tough questions about the market, but those that are abusive, I have no tolerance for that.
Chris Edmonds:
Understood. We would share that. We invest a lot in our employees and we expect a lot from them, and we have to give them the opportunity to perform at those high levels. And sometimes those situations require what seems to be a crazy decision at that time. We've discussed the definition of wealth, the optimal client experience, the art of investing a little bit, but what about protecting the wealth? Is there ever controversy with a client relationship where they want to do X, but the advice coming from you and the team is you need to protect Y?
Shannon Kennedy:
I think that just goes back to education and knowledge and wisdom that the clients have about the market. I think one thing that clients really don't realize is when you work with a fiduciary, the assets that you have on the platform are not assets of the bank. And so literally, our bank could fail, but your assets are really subjected to the risk of what you've invested in. So if you're, just as an example, just Amazon or Target, whatever stocks or other money managers, that's your risk. It's not the risk of the bank failing. So you contrast that with FDIC insurance and there's a limit. And when you go over that, you're not insured after that. We're insured for errors and omissions if we make a terrible mistake. But I think that a lot of clients don't really understand that safety of working with a fiduciary.
But at the end of the day, I think if clients are asking to do something that we know, and this is what makes our business tough, that we know is not the right decision, it's our responsibility then to educate. But at the end of the day, clients can vote with their feet and if they really don't like what we're asking of them, or if a client comes in and they only want investment performance, that's probably not the right client for us, or they don't really understand the amount of risk that they're taking when they say that. I want 15% return and I want no risk. Well, that's an impossible task.
Chris Edmonds:
We all want that.
Shannon Kennedy:
We all want that. I would love to have that. And so sometimes just saying that, well, how would you propose we do that? And then you're educating on the market. And so it really just comes down to education. If they don't want to hear the education, then that's their choice and it's their money. And we'd probably say something like, well, we've recommended this and you're recommending not to do it. Because often what happens then is three years later, they'll make the decision they want to make and then they blame us for the lack of performance or the portfolio performance. You're like, well, that was your decision, remember.
Chris Edmonds:
I am certain that there are times when there's an override that takes place. I also have to believe there's some times when the customer comes back and said, thanks for educating me because you all were right and it saved me.
Shannon Kennedy:
Yes.
Chris Edmonds:
Those have to be as victorious as signing the next new Family Office billionaire client to go manage because that's validation of what you and the team are building.
Shannon Kennedy:
I agree. I have a friend right now speaking of friends who's retiring from Grant Thornton with a significant amount of money. And I said, "I would love it if you worked with us, but you need to do some due diligence and here's some other firms that you should talk to." So I just have a deep ethical, do what's in the best interest of the client. And I think for her, she was working with a really small insurance company, which told me a lot. And I'm like, what? You're global manager of this major firm, but with a firm that I would say focuses in the mass affluent, and once you get the level of wealth that she will be receiving, there's different investment solutions and there are different planning solutions that you can be implemented. And if you're not working with a team that is aware and knows all of those, you're really not serving yourself well. So I did it in a way of like, interview these other three firms because we'll all kind of say the same thing to her.
Chris Edmonds:
Earlier you talked about some of the pillars of the bank and what BMO strives and the top down. I took over Fixed Income and Data Services earlier this year, and I begin to foster a culture of intent, purpose, and team. Along the way, understanding your intentions of what you're doing today, the purpose it serves, and ultimately how does it possibly impact our team. If I asked you to describe your leadership style and the pillars of that leadership style and how you oversee the employees at BMO Wealth Management, how would you define those?
Shannon Kennedy:
Well, I think first of all, if you can't tell, a deep servant leader, and I really just believe in lifting as I climb. So for me, it's been building a culture of caring; caring for the employees, caring for the clients, caring for the community. So those are kind of the three pillars. And then I mentioned earlier, employee happiness leads to better client servicing leads to happier clients, leads to better advocacy, and I definitely want to win. I hate losing more than I enjoy winning, actually. But I don't want to win when I win, you lose. I want to win like we're building a puzzle together and let's build this picture and let's complete the picture and then let's move on to the next picture.
And a couple of phrases that have always helped me along the way is when I have employees or leaders talking to me, I'll always say, "Tell me more." If they make a statement or can't get something done, "Ask, don't tell." I am a huge believer, you've mentioned it, intention, attention versus impact. I think often people don't realize their communication, 97%, the messenger, 3% the message. They don't understand how they've communicated and how that communication's been received. And that's the most important part, is how the communication has [inaudible 00:50:48]. And then, I always say, "Noes are free." And if I make a mistake, I always ask for forgiveness.
Chris Edmonds:
We all have the opportunity to do that, probably more than maybe we should, but I'm glad the people grant it from time to time. So last August, Lynn Martin here at the NYSE, nominated you for our Board Advisory Council. You're obviously leading the team in Wealth Management at BMO. What does the future for Shannon Kennedy hold?
Shannon Kennedy:
Yeah, first of all, thank you for that nomination. I was definitely humbled and I hope at one point that I can serve on a board and we'll be here, I think at the end of this month to watch the ringing of the bell with that Advisory Council. So what an opportunity and what an experience. So what does the future hold for Shannon Kennedy? I've been in the business for 38 years, so that's kind of a long time. And at some point, would probably do other things and one of those will be a board. I can't do that at the moment just because we have restrictions at BMO, but that would be kind of the next step in my future.
Chris Edmonds:
Well, Shannon, thanks so much for joining us here on Inside the ICE House. That's our conversation for this week. Our guest was Shannon Kennedy, CEO of BMO Wealth Management, US. That's NYSE ticker symbol, BMO. If you'd like what you heard, please rate us on Apple Podcasts so other folks know where to find us. Got a comment or a question you'd like from one of our experts to tackle on a future show, make sure to leave a review and email us at [email protected] or tweet us @ICEHousePodcast.
Our show today was produced by Lance Glenn with production assistance from Ken Abel. I'm Chris Edmonds, your host, signing off from the Library of the New York Stock Exchange. Thanks for listening. We'll talk to you next week.
Speaker 1:
Information contained in this podcast was obtained in part from publicly available sources and not independently verified. Neither ICE nor its affiliates make any representations or warranties express or implied as to the accuracy or completeness of the information, and do not sponsor, approve, or endorse any of the content herein, all of which is presented solely for informational and educational purposes. Nothing herein constitutes an offer to sell, a solicitation of an offer to buy any security or a recommendation of any security or trading practice. Some portions of the preceding conversation may have been edited for the purpose of length or clarity.
