“Ron is widely respected as an authoritative strategist and has been an insightful voice for our business for more than two decades,” said Kenneth M. Jacobs, Chairman and Chief Executive Officer of Lazard. “He has built strong relationships with Asset Management’s global client franchise and his macroeconomic and market insights have been a true differentiator.”

Since joining Lazard Asset Management in 2001, Mr. Temple has held several high-profile investment and client-facing roles, including analyst and co-director of global research. Most recently, he has overseen U.S. equity and global equity strategies as well as Lazard’s MultiAsset platform. Prior to Lazard, Mr. Temple spent 10 years in a variety of financial services roles, including fixed-income derivatives trading, risk management, corporate finance, and corporate strategy. He has a Master in Public Policy from Harvard University and a B.A. in Economics and Public Policy from Duke University. He is a member of the Council on Foreign Relations, the Economic Club of New York, the CFA Society New York, and is the chair of Duke University’s Graduate School Board of Visitors.

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In the recent detailed paper titled ‘Protectionism through a corporate lens’, Ronald Temple, Co-Head of Multi-Asset and Head of US Equities at Lazard Asset Management, a leading global investment manager, says “While  much remains uncertain about the future direction of these policies,  we believe the risk of further escalation is high and that a sustained  move toward protectionism could derail economic growth.

“Furthermore, corporate profits in the US are even more at risk than GDP due to how integrated the global economy has become.

“Reorienting global operations and supply chains could be difficult, disruptive, and costly for many businesses. Understanding how a business and its competitors are exposed to this risk is critical to evaluating the potential impact of protectionism on profits.”

Mr Temple assesses the impact of protectionism and notes that protectionism is more complicated than in the past given the interconnectivity of global supply chains.

“As a result, protectionist policies will likely be even more meaningful for corporate profits and markets than for the economy. Many companies also have significant overseas revenues and assets which could be exposed.

“The combination of US protectionism and Fed monetary policy tightening could trigger the next bear market in equities and perhaps even the next economic recession,” says Mr Temple.

Some US companies might come out ahead in a prolonged trade dispute. Among the potential beneficiaries are companies that:

1. operate in protected industries,
2. have domestic supply chains,
3. have primarily domestic sales, and
4. sell products for which customers are less sensitive to price.

Many others, however, could face significant challenges.

He concludes “The potential outcome of current trade tensions is highly uncertain and the impacts are complicated. While protectionist policies implemented to date remain small relative to the size of the US economy, they could have a much larger impact on corporate profitability. Additionally, trade challenges easily could escalate sufficiently to undermine confidence and derail the ten-year-old US bull market and economic growth.

“In addition to these general risks, it is important for investors to assess what is potentially exposed and how at a company level.  Doing so is difficult, due both to the globalization of business and supply chains and to inadequate disclosures at the company level.  However, understanding these exposures, as well as competitive positioning, is critical to evaluating risks and rewards and positioning portfolios appropriately.”

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