Learning from academia
Baillie Gifford’s links to academic institutions are a mix of education and philanthropy. Nick Thomas, a partner at the firm, explains why an investment manager would want to build such relationships.
Curiosity is an essential part of Baillie Gifford’s culture. A desire for knowledge drives us down many roads that other investment managers ignore. That approach has led us to seek out leading academics who can help us broaden our knowledge, and it has resulted in a programme of collaborations with world class institutions.
A striking example of what can be achieved through these relationships is our work with the University of Edinburgh. That includes supporting the appointment of Shannon Vallor as the Baillie Gifford Chair in the Ethics of Data and Artificial Intelligence at the Edinburgh Futures Institute (EFI). The EFI connection is among the significant links we have with academic institutions around the world, and is evidence of how we strive to learn from experts.
For us, providing this support is an important element of our backing of university research into the challenges and opportunities created by emerging technologies, including machine learning, accelerated automation and financial innovation.
Investment managers tend to rely on company and industry research, provided by investment banks. However, using similar information means they often reach the same conclusions and therefore produce similar investment returns. We strive to be different – both in our approach to research and in what we do for our clients.
One example of our inquisitive thinking has been our sponsorship of 16 literary festivals around the world. An important side benefit of our support for large and small festivals is that it presents us with the opportunity to hear from distinguished thinkers and to discuss their books and their opinions.
From there, it is a short but logical step to engaging with academics whose research has piqued our interest. Link-ups with the universities of Edinburgh and Glasgow were among the initial activities, and we have subsequently widened our activity to cover more than 12 institutions around the world in order to discover more intriguing, clever people doing intriguing, clever things. This has led to relationships with Tsinghua University on computational biology, and Santa Fe Institute, where Baillie Gifford is a member of the Applied Complexity Network – a collaboration on scientific developments that brings together scholars and members.
Our funding and support place us at the junction of education, science and philanthropy. We have a firm-wide research budget and take the view that using some of this money to discover new frontiers for ourselves is of greater value than buying investment research from others. We see our approach as a combination of research, sponsorship and good corporate citizenship. Baillie Gifford has no desire to influence or control the research. Our aim is to encourage experimentation, diversity and autonomy. The interest we show leads academics to appreciate that our partnerships are about more than just financial aid. We are conscious that a long-term research programme may never deliver on its promises. We take the view that projects which come to nothing should be seen as experimentation, not failure. Meanwhile, those that do work could be hugely valuable in developing our thinking on a range of subjects.
We hope our links with academia can accelerate the pace of research and bring forward possible benefits to society. That could involve helping to alleviate diseases, as is our aspiration for Tara Spires-Jones’s Edinburgh-based research project at the Centre for Dementia Prevention. It might also be in areas such as understanding the ethical dilemmas of AI which – in addition to our work with the EFI – is an area where we support Jeroen van den Hoven at Delft University of Technology. These collaborations fit with our long-term approach to investing, which is geared to supporting projects that take many years to reach fruition. We are conscious that security of funding over such a timescale is rare in academia, and we are happy to help overcome this barrier to progress.
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