Societe Generale Equipment Finance (SGEF) has retained its leadership position as the largest company in this year’s Asset Finance Europe 50 (AFE50). Jochen Jehmlich, the company’s chief executive officer, reviews a momentous year and provides his outlook on the opportunities and challenges for 2021.
We are very proud and honoured to be named, once again, number one in Europe according to the Asset Finance Europe 50 ranking.
This leadership position encourages us in our role financing the real economy and taking responsibility for supporting sustainable growth in our clients and vendor partners.
Showing resilience in a challenging and chaotic year
Despite the very challenging and chaotic year we have all been through, Societe Generale Equipment Finance (SGEF) has shown strong resilience.
During the various lockdown periods, SGEF has remained open for business without any single day of interruption.
We have been able to keep the same level of service everywhere, whatever the situation in each country where we are present.
We were able to capitalise on our wide geographical coverage, reactivity, and mutual support from our internal teams. I would like to thank all SGEF employees for their hard work.
We also showed alignment between the various stakeholders and a strong partnership approach with our clients and partners. During the crisis, we have launched the #StrongerTogether programme to support the investment plans of our clients and partners.
The objective was to offer flexible financing to help them convert frozen pipelines into funded deals and stimulate the restart of their businesses.
In total, €1 billion was made available throughout the SGEF network. In addition, our day-to-day focus has been dealing with deferral requests, managing governmental support plans, adapting to compulsory moratoriums, adjusting to more prudent cash management from clients, overcoming delivery issues, and developing innovative financing solutions.
Globally, SMEs have been more impacted than large corporates this year. In terms of sectors, the biggest impacts were observed in the industrial equipment sector, and of course in tourism, transport and leisure.
The IT sector has performed well, benefiting from the traction of some corporates which are now more favourably looking at leasing payment solutions to manage their liquidity, and of course thanks to the acceleration of digital needs.
The medical sector also continued to be dynamic, while green initiatives benefited from targeted subsidies.
Strategies for sustainable growth in 2021
We cannot predict 2021 without assessing how the COVID-19 crisis will impact our lives in the short-term and afterward.
This unprecedented crisis has already changed our lives, both in our personal and business spheres.
Some trends have been accelerating, such as new technologies, environmental consideration, new ways of working and new consumption models, but what structural changes in our behaviours and beliefs will remain tomorrow? How will the asset finance sector in general - and SGEF in particular - be impacted?
Firstly, the lockdowns forced us to rapidly test and improve our connectivity and digitalisation to stay in contact and to be able to work remotely.
Being part of an international banking player, Societe Generale group, SGEF was at the leading edge in terms of remote working models.
No doubt, we will keep ahead and capitalise on it in the ‘new normal’ context after COVID-19.
In terms of digitalisation, the crisis has shown the need to accelerate our investments and efforts.
Nowadays, E-signature technology has become the new norm; the next step in everyone’s mind is the full digitalisation of internal processes.
We are working on it, but are all our clients ready for a full digital relationship? Some clients are asking for this kind of model, but sometimes, the customers’ behaviours differ compared to expectations.
It remains crucial to identify how clients’ needs can be solved through digital solutions to overcome blocking points and deliver seamless digital customer journeys.
The emergence of new technologies
Before the crisis, the pace of change was already impressive. It increased even more during the crisis, and we could observe the adoption and the development of new use cases.
New assets are emerging in this environment and, as lessor, we have to know and understand these assets and their specific dynamics. We will need to develop new expertise and asset knowledge in the coming months.
The COVID-19 crisis, which was first a public health crisis, has also raised awareness around environmental responsibility.
We can imagine that sustainable topics will increase next year in the minds of decision makers.
If companies can afford it (once they have recovered from the crisis), we anticipate an appetite for green assets.
The nature of our industry positions us well in the environmental battle as we are constantly financing new assets.
To support our clients’ energy transition investments, SGEF has put corporate social responsibility (CSR) at the heart of its strategy. Beyond the importance we all see in the development of CSR activities for the benefit of our planet, this will help us attract and retain clients.
Our commitment in this field is largely driven by interactions with our clients and partners; more of our discussions relate to energy efficiency, electrification, investments in sustainable equipment such as photovoltaic, and asset lifecycle improvement.
Of course, many other challenges are ahead, such as the circular economy, new models of consumption (usage and bundled offers vs ownership), new ways of working and so on.
Expectations are high in this field and I think we will have to find a way to adopt hybrid models that benefit clients, employees and the environment at the same time.
The global economy is uncertain, as is the future of the leasing industry, but I am optimistic. SGEF has many strengths; we have shown resilience during the crisis, we are embracing the digitalisation of our processes, we are accompanying the environmental transition, and taking responsibility.
We are at the heart of the real economy. We look forward to supporting sustainable growth for our vendors and clients all over the world, building reliable and trustful relationships and partnerships.
* Jochen Jehmlich was appointed CEO of SGEF in 2017. He is also CEO of GEFA Bank, the German entity of Societe Generale Equipment Finance.
* This article first appeared in the Asset Finance Europe 50, the exclusive ranking of the largest asset finance companies in Europe. To download your copy, complete the form below.