Part-II: Cybersecurity Breaches - Human impact and Regulations

In this second-part of our discussions with Cybersecurity expert - Ludovic Petit, we particularly focus on the impact humans have on not just causing cyber-attacks but also on mitigating the risks involved in the world of Cybersecurity Breaches.

(Part-I with Mr. Petit : The world of Ransomware: trends, recent issues & awareness

Ludovic PETIT is Chief Executive Officer at JADE, a cybersecurity and business strategy consultancy. He assists companies to create a unifying and value-creating culture of digital security through consulting missions related to cybersecurity and business strategy, legal compliance on information security and through audits. Being a well-respected authority on cybersecurity and data protection, Ludovic PETIT also serves as Associate Researcher at the Research Center of the National Gendarmerie Officers Academy, Commander, Defence and Security Citizen Reserve Gendarmerie, Auditor of the High Studies Centre of the Cyberspace, member of the Board of Directors of Cyberlex, the Law and New Technologies Association and was Global Chief Information Security Officer at Altran.

It is true that every system is not perfectly secure. However, a lot of breaches are explained by the lack of best practices (human level) and by cunning methods like Social Engineering - could you please elaborate on these factors? 

Mr Petit: There is no such thing as 100% security, in fact for a quite simple reason: technology today is so complex that there can be errors in software design, or in operational implementation. This is a fact, and we must accept it as such.

Thus, for developers, the concept of "secure coding" about software design, whose purpose is to minimize the possibility of vulnerability in the code you write.

Secure Coding is a technology agnostic set of general software security coding practices, which can be used in a comprehensive checklist format, that can be integrated into the development lifecycle.

The reference in this area is OWASP, a non-profit foundation that works to improve the security of software.

OWASP provides an open-source training platform created for developers to learn and practice modern secure coding techniques, and helps develop secure coding skills through real-world challenges, to ensure knowledge acquired can be confidently applied in the real world.

The daily cyber news unfortunately shows us that, far too often, the principles of security and secure coding are obviously not respected, but this is not the main reason.

The combination of 'security patch not applied, or not up to date' + the 'lack of security process' in the operational implementation of the solution generally leads to major flaws and issues in information systems, so in information security. Let’s now switch to Social Engineering.

Social engineering is the term used for a broad range of malicious activities accomplished through human interactions. It uses psychological manipulation to trick users into making security mistakes or giving away sensitive information.

What makes social engineering especially dangerous is that it relies on human error, rather than vulnerabilities in software and operating systems. Mistakes made by legitimate users are much less predictable, making them harder to identify and thwart than a malware-based intrusion.

The interesting thing about social engineering is that, although it can be dangerous for a company, it can also be used by the company in security awareness sessions for its employees.

The key is psychological manipulation, depending on the level of credulity, emotion, guilt, responsibility of the person under attack.

A well-known example is the “Fake President Fraud” or “CEO Fraud”, a social engineering attack where a hacker tries to convince a financial department employee of a company to send out a payment to the attacker’s bank account, by claiming an emergency context under false pretences.

Another classic is to call a company's switchboard pretending to be a service provider to obtain confidential information about people or internal processes, which can then be purposely exploited by competitors or hackers.

Although most of the time, attacks are carried out either by an email (Phishing) targeting a specific person (Spear Phishing attack) or directly by phone, social engineering attacks come in many different forms and can be performed anywhere where human interaction is involved.


What is the weight of human involvement in Ransomware issues?

Mr Petit: To be pragmatic, I would say that prior to any involvement of a target, interest must first and foremost be aroused.

I ‘skip’ over the types of attacks that rely on technical and security weaknesses, allowing the hacker to inject and activate malware/ransomware within an information system.

This is a phase of a process well known to hackers, in which one is already doing what is called a 'mapping' of the context one is trying to target, to perfect what is called 'target acquisition'. In other words, we first gather information on the company, its context, its business, its financial value, etc., to design a succinct but realistic approach that will arouse the interest of the target person regarding his or her daily activity.

And what medium to use for this if not the free and most used service on the internet… namely email.

The ROI of a ransomware attack carried out by messaging is unparalleled, as it is free, fast and cannot be formally identified.

It only takes one person in a company to click on a link in an email forged by the hacker, or to open a document attached to the email sent, for ransomware to be activated on the target person's computer/system. Done!

In fact, to sum up, reality of facts shows that the weight of human involvement in Ransomware issues depends on the level of awareness of the individual. And it is not always easy to detect a phishing email that might contain Ransomware, because, whatever one thinks, hackers are also very clever.

There is no magic or 'one size fits all' solution.

The implementation of a solid anti-spam solution for email is obviously a requirement. So is raising staff awareness of security risks.


A wave of attacks has been surging over the last months on countries and companies. After the Colonial Pipeline’s attack, the White House wrote an open letter where it reminded the need for companies to adopt better standards of security. Could you please share your inputs on the specifics discussed here? 

Mr Petit: President Joe Biden and the White House have acted on major cybersecurity risks as a matter of national sovereignty, just as it is for France and every other country in the world.

Without playing devil's advocate, let us not forget that a legislator/a country legislates when the industry is not able to take the necessary measures to manage and mitigate risks, or issues, which sometimes impact on the continuity of service provided to individuals or the nation, or which could potentially harm a nation's interests.

In France, for example, this led to the creation of the status of Operator of Vital Importance (OIV), whose Military Planning Law (LPM) obliges operators designated as being of vital importance to the nation to adopt a certain number of measures designed to protect their integrity and that of their computer systems. The LPM also includes implications for partner companies and/or subcontractors of companies qualified as OIV.

Another example is the status of Essential Service Operator (Opérateur de Service Essentiel - OSE) and Digital Service Provider (Fournisseur de Service Numérique - FSN), which are dependent on the Network and Information Security (NIS) Directive that requires them to ensure a high level of security of their networks and information systems.

This is in fact due to a paradigm shift:

Historically, until the beginnings of the Internet at the end of the 1980s, technological developments took precedence over the legal reference framework, which had not evolved accordingly, posing a major problem for the legislator.

The law then evolved in line with technological developments, as in France in the case of the Godfrain Law of 5 January 1988, on computer fraud, the first French law to punish acts of computer crime and hacking. It is one of the pioneering laws concerning the law of new information and communication technologies (NICT), after the law of January 6, 1978, called "Loi Informatique et Libertés”, which introduces the notion of automated data processing system (STAD) and provides for several correlative provisions of the Godfrain Act (concerning the obligations of the data controller with regard to guaranteeing the security of the data - Art. 34 of the 1978 Act).

This trend has since been reversed, and France has been a forerunner in legal developments relating to new technologies, emulating many around the world, as for example the California Online Privacy Protection Act of 2003 (CalOPPA), which came into force on 1 July 2004 and was amended in 2013, and which was the first state law in the United States to require commercial websites and online services to have a privacy policy on their website.

This paradigm shift is illustrated by the fact that, nowadays, and for the last twenty years or so, the legal and regulation framework rule the technical means to be implemented to comply with the law, as for example the General Data Protection Regulation (GDPR) which came into force on 25 May 2018 for any company processing the personal data of European citizens, with a notion of extra-territoriality.

It is therefore clear today that technology is no longer sufficient to protect the interests of a company or a nation, hence the need to legislate accordingly. This is certainly not THE solution, but I think it is good to sometimes consider the legal constraint as an opportunity for a company to work on Cybersecurity in a relevant way and at the highest level according to its business sector.

Beyond the legal obligation, I would add that cybersecurity is not only a necessity but also a matter of common sense to protect the company's assets and thus contribute to being perceived as a trusted partner by its customers and partners.

Thus, the White House open letter where it reminded the need for companies to adopt better standards of security makes sense, and as a security expert I fully agree to this approach.


What are the key items that remain unresolved currently and potentially for the future?

Mr Petit: I think that real international cooperation between nation-states is needed. Strengthening the links between governments, organizations working on global cybersecurity is an important step, as is the synergy between the academic sector, private industry, security companies and governments.

But the reality is quite different, we must admit. As General de Gaulle said, "Nations have no friends, they only have interests".

On a more optimistic note, and this is the reality of the situation, one of the most important challenges that partly answers the question is that it is time for the function of Chief Information Security Officer to be at last considered and recognized by the Executive Committee and HR Department as a major one within companies, and that Executive Committee take the full measure of it by providing the means to the CISO to honour the mission for which he/she was hired, by bringing him/her support and confidence.


Do you believe states and firms are doing their best to avoid these kinds of situations?

Mr Petit: It is always a case of the glass being half empty or half full. Although I am a natural optimist, I will say to remain diplomatic that the situation is very clearly perfectible.

I have the feeling that everyone looks at each other but does not see each other, everyone hears each other but does not listen to each other. And this is a widely shared feeling in the cybersecurity community.

We can always do better, for sure, maybe there should be much more interaction between States and firms. However, I think that this should also be done through a kind of appetite for communication on the part of the big leaders of industry as well as governments, which admittedly does not always work both ways.

Let us end this interview on an optimistic note. I am fortunate to be able to do a job that I have been passionate about for more than thirty years, and which, in view of technological developments, can only have exponential durability over time because it is applicable to all sectors of industry.

You know, the prism of cybersecurity has many facets.

I hereby thank Xperts Council for the opportunity to briefly share some passion.

Part-I: The world of Ransomware - trends, recent issues & awareness


Modern day threats to organizations, states and individuals are now consistently driven through the digital world. Cybersecurity and digital threat intelligence is an ever growing topic that can be covered over a series of articles and research studies. In this blogpost, we do things a little differently with some candid but detailed conversations with Ludovic Petit, a leading expert in Cybersecurity.

Ludovic PETIT is Chief Executive Officer at JADE, a cybersecurity and business strategy consultancy. He assists companies to create a unifying and value-creating culture of digital security through consulting missions related to cybersecurity and business strategy, legal compliance on information security and through audits. Being a well-respected authority on cybersecurity and data protection, Ludovic PETIT also serves as Associate Researcher at the Research Center of the National Gendarmerie Officers Academy, Commander, Defence and Security Citizen Reserve Gendarmerie, Auditor of the High Studies Centre of the Cyberspace, member of the Board of Directors of Cyberlex, the Law and New Technologies Association and was Global Chief Information Security Officer at Altran.

We have split our conversations with Mr. Petit  into two sections. In the first part, we cover the topic of Ransomware, right from the basics to recent attacks caused by ransomware.

To empower our readers with the basics, what is Ransomware?

Mr Petit: An indication for our readers, before diving further into the subject; there are many reports presenting cybersecurity trends from all angles, but if there is one that I recommend reading it is The Global Risk Report 2021 from the World Economic Forum.

The Global Risks Landscape ranks Cyber-attacks as the 3rd most important risk... just behind pandemic and climate change risks! All is (almost) said.

Most expert firms (financial, economic, technical) around the world agree that, if it were a country, the economic weight represented by Cyber Risk would make it the third largest economy in the world, behind the United States and China.

Well, in short, Ransomware is a type of malicious software (a Malware) that is designed to hold your files or computer hostage, demanding payment for you to regain access.

Although the phenomenon of ransomware is not new, it has never been as widespread as it is today. As companies' activities are increasingly based on connected services, the fight against ransomware and more generally against malware is becoming a priority. Indeed, for a few years now, most security trend reports in the world rank Ransomware as the most frequent and impactful type of cyber-attack.


X-Force Threat Intelligence Index 2021:

ENISA Threat Landscape 2020:


Why should individuals and organizations be concerned about it now  and what does the future entail?

Mr Petit: We now live in a digital world, a cyberspace that, unlike the geography of the countries we all know, has no borders. And whatever we think, daily news shows us every day that this cyberspace has unfortunately become dangerous. Cyber-attacks are shutting down companies, with disastrous economic impacts, sometimes even in terms of jobs when a company has no choice but to file for bankruptcy following a cyber-attack, impact individuals and cities, and even countries (remember the 2007 cyber-attacks on Estonia?).

Jerome Powell, the president of the US central bank, recently said he was more concerned about the risk of a large-scale cyber-attack than a global financial crisis.

“The world is changing. And so are the risks. And I would say that the risk we are watching most is the cyber risk,” he said, adding that it is a concern shared by many governments, large private companies, especially financial companies.

The COVID pandemic increased this risk of cyber-attacks, simply because companies had to react very quickly to put in place remote working solutions, most of the time not compliant with their own information systems security policy, because the imperative of business continuity took precedence over security of use.

Many employees have also had to use their own computers at home to connect to their company's information system, and in such circumstances, the level of information security and the one of their computers' security is most of the time not the same as that of a mastered corporate computer.

As we can see, all of us are concerned by Cybersecurity.


What are the good practices to limit or avoid the risks of encountering Ransomware?

Mr Petit: There is no 100% security. On the other hand, compliance with your company's information systems security policy is obviously a fundamental step.

From a more generic point of view, common sense applies:

  • Apply system and software updates to your computer on a regular and systematic basis,
  • Update your antivirus and antimalware software, and configure your firewall to allow only legitimate applications, services, and machines,
  • Do not read emails, their attachments or click on links from chain messages, unknown senders or from a known sender, but with an unusual or empty message structure,
  • Do not install any 'hacked' application or program, or of dubious origin or reputation,
  • Avoid browsing unsafe or illegal sites (most of these sites contain malware),
  • Make regular backups of your data and system so that you can reinstall it in its original state, if necessary,
  • Do not use a user account with 'Administrator' rights/credentials (an information security classic) to check your emails or browse the internet,
  • Use sufficiently complex passwords and change them regularly.

Adherence to these few rules can already prevent many problems.

I highly recommend to browse the ANSSI website in France, as well as our German counterparts the BSI and the UK with the National Cyber Security Centre, who provide a lot of valuable advice and guidance about cybersecurity and information systems security.


It should also be noted that hacker groups are starting to build real business models of organized cybercrime. This is one of the aspects on which specialised international police and gendarmerie units are working together, in relation with InterPol (International Criminal Police Organization, and other international bodies, with, it must be said, great success and increasing efficiency.

Through Ransomware-as-a-Service (RaaS) there exists a business model that supports ‘partners’ to carry out attacks against victims, and to share the profits with the developers of the malware. In return for this arrangement, such partners or affiliates are offered a sizeable share of profits, in a relationship that appears to suit both parties based on the rise in use of such a model.

As can be seen, the world of cybercrime also has its parallel economy.

These Ransomware attacks can also be dramatic. Some hackers have no scruples.

Last September 2020 in Germany, a woman who needed urgent medical care, died after being re-routed to a hospital in the city of Wuppertal, more than 30 km away from her initial intended destination, the Düsseldorf University Hospital.

The Düsseldorf hospital was unable to receive her as it was amid dealing with a ransomware attack that hit its network and infected more than 30 internal servers on September 10.

The incident marks the first-ever reported human death indirectly caused by a ransomware attack.

The patient's death is currently being investigated by German authorities. If the ransomware attack and the hospital downtime are found to have been directly at fault for the woman's death, German police said it plans to turn their investigation into a murder case.


Recently, the Colonial Pipeline cyber-attack affected gasoline supply in the East and Southeast of the United States. What is the appraisal and cost of these attacks? 

Mr Petit: An analysis of the cyberattack on Colonial Pipeline found that the hackers were able to access the company’s network using a compromised (weak) VPN password.

The VPN login - which did not have multi-factor protections on - was unused but active at the time of the attack. So, we can see that 2 essential security rules have not been respected: low level of authentication, and weak authentication process not disabled. Unfortunately, a classic in cybersecurity.

The breach occurred April 29th, according to Mandiant, and was discovered on May 7th by a control room employee who saw the ransomware note. That prompted the company to take the pipeline offline to contain the potential threat.

About the only thing that hasn't been hurt by the hacking attack that shut down the Colonial Pipeline? The company's market value. Unbelievable, and yet true.

Indeed, if it were publicly traded, the Colonial's stock would undoubtedly have tumbled. But the 59-year-old firm is privately held, with its ownership split among five owners spread across five countries on four continents.

That said, the attack on Colonial Pipeline has had, and will have, an undeniable cost, if only to the company itself, because of the huge economic impact that resulted. Indeed, about 45% of all fuel consumed on the East Coast of the United States arrives via the Colonial Pipeline system.

The Colonial Pipeline is a strategically important pipeline system of approximately 5,500 miles in length - nearly 8,850 km - carrying petroleum products from refineries on the Gulf Coast to the north-eastern United States in the New York area. In total, the pipeline crosses 17 US states, accounting for almost 40% of the national population and about 30% of US oil consumption.

One of the first impacts was that gas stations ran out of gas. The direct economic result is therefore a loss of business for the entire network of gas stations concerned.

In direct cost terms, the hack led to a ransomware payout of $4.4 million and resulted in gas prices around $3 per gallon for the first time in several years at US gas stations. To avoid a shortage and a spike in prices at the pump, several East Coast governors have declared a state of emergency to facilitate supply.

As Americans rushed to the pumps to stock up, authorities had to take emergency measures to facilitate supply and avoid panic, but also restrictions on road transport.

According to, which tracks fuel prices and outages at gas stations, more than 9,500 gas stations were out of stock, half of them in Washington and 40% in North Carolina.

Taking such emergency measures has a cost in terms of organisation, just as seeing people rush to gas stations impacts on the business of the companies that employ them, not to mention the resulting traffic jams that have had an impact on the local economy as well.

Although we do not have precise figures, we can therefore estimate an enormous indirect cost perspective for the local economy.

Now, 2 facts which, in such circumstances, are likely to weigh heavily in the Cybersecurity balance of Colonial Pipeline:

Colonial Pipeline will have to completely overhaul the cybersecurity of its national infrastructures, which has a definite direct cost on the scale of such a company (audit, consultancy firms, equipment, and solutions, but also staff training, etc.). This will therefore have a serious impact on its financial business plan.

The second fact is perhaps even more serious: The hackers, who are part of a cybercrime gang called DarkSide, have stolen nearly 100 Gb of data out of the Alpharetta, Georgia-based company's network ahead of shutdown.

It is not yet known what exactly the stolen data contained, but as Colonial Pipeline provides an infrastructure-based service considered critical to the nation, it is highly likely that hackers focused on sensitive information such as, for instance, the company's internal operations and infrastructures.

We can consider that hackers have knowledge of the company's internal processes, which now makes the task of securing the infrastructure much more complex than it seems.

The associated costs for Colonial Pipeline will therefore have to be commensurate both with the challenges, and the stakes… and at this scale of criticality, the costs are likely to be very high.

The attack against Colonial Pipeline demonstrates the fragility of Uncle Sam about cyber-attacks. It is in this context, that the President of the United States, Joe Biden, signed on Wednesday 12 May 2021, an executive order intended to reinforce the country's security against computer attacks.

The White House wrote an open letter where it reminded the need for companies to adopt better standards of security. Thus, this will have a direct impact on the way risks are managed in companies.

Consequently, the attack on Colonial Pipeline is taking on a significant national dimension, with an impact far beyond the scope of Colonial Pipeline.


Are these attacks coming from specific regions?

Mr Petit: A complex subject which certainly deserves special attention.

Several groups of hackers which have made cyber-attacks one of their specialities, are linked or purposely used by certain nation-states that I will not name for the sake of decency.

There is a whole parallel economy in the cybercrime sphere, that's reality, and it is important to know that some of the patterns of fraud, cybercrime and attacks of all kinds carried out on a large scale, can sometimes represent the GDP of a developing country.

This is one of the reasons why it is important that the subject of Threat Intelligence is taken very seriously in companies and is an integral part of any corporate Cyber Security strategy.

There is one constant in the Underground community: the very high level of technical skills. Indeed, hackers use powerful technologies to carry out their attacks.

Therefore, it is always very complicated to have precise facts that can directly incriminate such or such attacker, or a country from where the attack could have originated, because technologies are such nowadays that it is easy to make believe in the origin of an attack. I would add that it is also easy for hackers to design malware in such a way as to make it appear that the technical 'signature' is of a known origin. This is a common practice in the underground and hacking ecosystem.

One of the rules in hacking is to erase or cover one's tracks, and to make sure that one appears for what one is not in reality. This is the cyber security expert speaking, but from a technical point of view, the rule is to never take for granted what you see or discover. You must always 'triangulate' and corroborate the facts. Say, the output remains facts, but rarely the reality of the facts.


We now wrap up part-1 of this two-part series of our cybersecurity discussions with Mr. Petit. We thank Mr. Petit for his valuable inputs to help us better understand Ransomware and the recent issues pertaining to the same. Please check out the second part of these discussions covering human and regulatory impact on  Cybersecurity Breaches.

Interview with François Le Scornet: State of Play - Hydrogen Energy

Given the keen interest lately around Hydrogen as a clean energy source, we gathered expert insights on its application across industries, particularly in the Automotive sector. For our blog readers that stay close to the latest trends in the energy sector, we’ve got some crucial inputs from François Le SCORNET around policy implementation and also the biggest challenges Hydrogen faces as an energy source. 


François Le Scornet cumulates 15 years of international experience within the energy sector. He worked respectively for the US Department of Energy (hydrogen - fuel cells), then for AREVA (mainly nuclear, offshore wind farm, storage), and finally for GE Renewable Energy (mainly hydroelectric energy, offshore wind farm, solar and storage). Since 2016, he is President and Senior Consultant supporting sustainable energy technologies at Carbonexit Consulting. He has deep expertise in technologies and policies associated with the energy industry.


Below is our detailed interview with François Le Scornet who is actively involved in this subject as an experienced Advisor - 


Public authorities are pushing to use new sources of energy within the automotive industry with electricity and hydrogen. Is it economically sustainable by increasing the adoption rates of relying on these new energies?

François: When it comes to on-the-road mobility, hydrogen actually takes time to take off to say the least. This is particularly true for small individual cars where adoption rates remain very low despite the release of quite few Fuel Cell Electric Vehicles (FCEV) models by companies like Hyundai and Toyota in particular. Recently, many public policies pushing green hydrogen not only to decarbonize the industry but also to fuel a clean mobility sector (trucks, buses, light vehicles, infrastructures etc) are pushed in many countries and will support the development of Hydrogen-based mobility. 


What do you consider as the major differentiator(s) between Hydrogen fueled cars and electric vehicles to have a significant impact in the automotive industry? Which energy source do you see winning?

François: FCEV are certainly very quick to reload (5-10 minutes only) and are usually able to achieve longer distance than their battery-based counterpart, the Battery Electric Vehicles (BEV) if you look at it in broad terms. However, these advantages may be challenged over time and the lack of hydrogen infrastructure remains a significant issue for hydrogen fueled vehicles. For these reasons in particular, battery electric vehicles actually outcompete hydrogen-based vehicles for light vehicles and shorter distance and that should remain so. A particularly interesting segment where hydrogen may play a more significant role remains the heavy-duty vehicle segment, where hydrogen-based solutions may be competitive if the appropriate infrastructure is in place. This is also true for specific niche markets like fuel-cell powered forklifts and material-handling equipment (e.g. In ports).


Looking at the benefits and the drawbacks of Hydrogen powered vehicles - what important areas should the automotive industry focus on so as to improve adoption rates?

François: Quick to refuel and with significant autonomy, FCEV can complement BEV to achieve broad decarbonization of transport segments. In order to develop and increase FCEV customer acceptance, the automotive industry need to  leverage supporting policies and invest to propose (1) a robust green hydrogen dispensing infrastructure (2) costs reductions linked to scaling up of FCEV production (3) a broader range of model choices. But again, without significant breakthrough in electrolyzer technologies and energy storage, the most interesting segment remains the heavy-duty vehicle. Even if the adoption of green hydrogen for light vehicles may increase, the alternative BEVs remain very competitive. 


According to the International Energy Agency (IEA), hydrogen is already used in several sectors like in the oil & gas sector (oil refining), chemicals industry (ammonia production, methanol production), mining & metals (steel), etc. It could also be used in other industries like power generation. Do you think other sectors could use this energy source or are the practical applications still limited for now? What sectors do you see potential in, i.e. for further investments into Hydrogen as an energy source?

François: Green hydrogen should be directed towards sectors where no alternatives to decarbonize are available like industrial uses and energy storage. Hydrogen is widely used in the industry today but this hydrogen is quasi exclusively produced from fossil fuel, in particular through steam methane reforming. This is the so-called grey hydrogen. The main challenges for these sectors, In order to fight climate change, is to replace this grey hydrogen by hydrogen produced from alternative low-carbon processes, in particular from water electrolysis using low-carbon electricity from renewable energy. This way, it can decarbonize the sectors traditionally using grey hydrogen from fossil origin: oil refining, ammonia production, steel-making in particular. In addition, Green hydrogen may be more broadly adopted in specific markets to decarbonize residential and commercial heating systems relying on expensive natural gas. However, technical challenges associated with the capacity of the network to handle significant percentage of hydrogen remain unsolved today.


For a clean and widespread use of Hydrogen in global energy transitions - what do you consider the most important and immediate challenges to tackle?

François: The bigger challenge around adoption of green hydrogen, either to replace grey hydrogen or to be used in new applications, is clearly its high cost. Even if electrolyzer costs and renewable energy costs will most probably continue to decline. The expected increase in CO2 costs will also favor its competitiveness comparatively to grey hydrogen and blue hydrogen (grey hydrogen + carbon capture). 


From a regulatory and policy perspective, what are the governments and authorities doing to simplify the adoption of Hydrogen as a reliable sustainable energy source? Could you please share your inputs regarding European countries/governments?

François: Incentive schemes can be used to kick-off the installation, drive demand and allow for scaling-up plants, ultimately leading to cost decrease and first successful use cases for green hydrogen. Many countries have been releasing their hydrogen strategy over the last few years, e.g. in Japan, Australian. At the EU level, many countries have adopted explicit hydrogen-related objectives.

At EU level, In 2020, the EU hydrogen strategy was adopted in order to accelerate the development of clean hydrogen, which will play an important part in the European Green Deal for instance, and specific objectives and timelines have been released. Specific forum like the European Clean Hydrogen Alliance, which brings together public authorities, industry, and civil society aims to coordinate investments. 


Reports from last year state that China, Morocco and Chile seem well placed as the leading countries for Hydrogen-Production. Could you further elaborate on why this is the case? What type of industry sectors are adopting this energy source and why?

François: The cost of producing low-carbon "Green" hydrogen through electrolysis is linked mainly to the price of the electrolyzer (CAPEX) and the price of low-carbon electricity (for OPEX). Countries with high solar and wind potential typically are therefore well positioned to produce green hydrogen at a lower cost comparatively with other countries for a given electrolyzer investment. This is the case for Morocco or Chile. In other cases, the main driver is a supporting policy to both renewable energy development and local hydrogen demand at the same time. This is the case in China for instance which support strongly the production of FCEVs.


Which other countries / regions do you see having major potential in Hydrogen production? Can you give examples from both developed as well as emerging economies?

François: EU, Australia, Japan and Saudi Arabia 


We would like to sincerely thank François for his valuable time to speak with us about this subject. Should there be an interest in leveraging expert insights on any of your studies pertaining to Hydrogen energy or clean energy transitions, please get in touch with us at Xperts Council.

Hydrogen Energy - Production & Storage by Lucas Bertrand, ITM Power

In this blog post we continue to learn more about Hydrogen as an energy vector source but more specifically in terms of its production and storage requirements. To empower us with the right knowledge and fundamentals on this subject around Hydrogen, we spoke with Lucas BERTRAND who currently leads the Business Development activities across France, Benelux, Iberia and Italy for ITM Power – a leading manufacturer of Hydrogen Energy Systems for Energy Storage and Clean Fuel production.



Lucas Bertrand is ESSEC MBA graduated and has 30 years of Business Development expertise in renewable energy & portable power. He has worked in the hydrogen business for 13 years with ITM Power recently and with Areva Renewable prior to that. Formerly, for close to 11 years he was overseeing the OEM Business across Europe at Duracell.


To begin with, it is important to understand the basic concepts associated with Hydrogen. Being one of the lightest and most abundant elements in the universe, hydrogen’s natural form on earth is typically found in combination with other elements (in water –H2O, natural gas (CH4), or other fossil compositions (CH-XX). Keeping aside today’s conventional methods for Hydrogen production, we will specifically focus on Electrolysis - a mature technology that consists in generating the molecules of hydrogen through an electrochemical reaction using electric current. In particular, water electrolysis has gained momentum over the last decade as the ideal way to produce hydrogen via a clean process: When using renewable electricity, the splitting of water molecules (H2O) generates oxygen (O2) and clean & green hydrogen (H2) with zero carbon footprint, compared to the heavy carbon footprint of conventional fossil production methods. This technology can be used to participate in the Energy Transition and decarbonize industry, transport, and heating networks.

According to Lucas, the emergence of water electrolysis is ramping up in various market sectors: Mobility, Industry and also the storage of renewable energy. This is primarily driven by the following factors - (i) the need to store growing intermittent renewable energies, (ii) EU regulations (2021-2030 plans) now need to be transposed into national policies (RED II on E-fuels, and ETS IV on CO2 emission reduction targets), and (iii) the decreasing cost of renewable electricity.

One of the fundamental issues surrounding the production of decarbonized hydrogen is its storage. Hydrogen is difficult to store due to its very low volumetric energy density (2700 times less energy dense than gasoline). Any micro leak can dissipate stored hydrogen very quickly. We asked Lucas to give his inputs on the typical steps currently being considered to improve the storage of hydrogen. He states, “Compression and Liquefaction are the most common ways to reduce Hydrogen footprint. Compressed or liquid hydrogen can be stored today in large tanks made of steel (Type I & II) or composite (Type IV), the latter being light enough to be used on board vehicle for instance. Today, improved compression technologies with better efficiency are deployed: this is the case for instance of ionic compression, a technology developed by Linde Gas, the worldwide #1 leader in industrial gas, with an electrical consumption reduction by minimum 30% vs conventional diaphragm compressors.

There is some development on Hydride based storage in a solid form, but clearly, it is still in low TRL maturity at present. Of course, compression, and to a greater extent liquefaction (~30% energy loss) require a significant amount of energy. This needs to be taken into account when we calculate the “well to wheel” levelized cost of Hydrogen. This is why it is essential to get a cheap electricity to produce electrolytic hydrogen.

The current move towards large scale hydrogen production, combined with the necessity to transport it from sunny or windy regions - where it is produced-, towards the geographical regions where it will be consumed, requires large transport and storing infrastructure: this can be done through on the one hand, large pipeline networks that exist today but will widely expand  across all Europe (eg.BackBone H2 project), and on the other hand, Salt Caverns that can store millions tons of hydrogen for long periods”.

Lucas further speaks about the future trends & current standards of storage options. Particularly for on board storage in the mobility sector, composite vessels type III and type IV are currently being developed in increased sizes (from 40 liter to 100 liter+) - these of course are lighter and the costs are effectively going down as well. On the automotive side of things, in particular for heavy mobility (bus, trucks), increased pressure for Fuel Cell Electric Vehicles (FCEV) tanks from 350 bar to 700 bar allows to embark more hydrogen for more kilometres driven. He also states that development of high pressure logistic tube trailers, to transport gas by road, should come in handy in the future as well (from 200 bar to 300-350 bar). Mobile containerized solutions up to 500 bar are currently in development, which could enable to transport larger quantities of H2 on a single trip, but also could possibly eliminate several stages of compression at the refuelling station site.

Hydrogen Mobility started with passenger cars. Most car OEMs announced hydrogen car introduction in their product line (with the exception of Volkswagen and Mercedes) but this segment will remain small for quite a while, compared to the Heavy Duty Vehicles (HDV) like trucks or buses. Indeed, the Fuel cell passenger car market will take time to become a mass market, unless local incentive policies boost the car prices to become more affordable. Quoting Lucas, “we are in a ‘chicken and egg’ situation where car OEMs blame the infrastructure providers not to be widely enough developed, whereas the Refuelling station operators are discouraged to invest in an infrastructure that is barely used, by lack of vehicle. This is the situation in Germany where about 100 Refuelling stations have been deployed thanks to large subsidy programs, for less than 1000 Fuel Cell cars on the road.  Whereas buses or trucks consume more hydrogen, hence an infrastructure can reach a break even with less vehicles: A 1ton/day Hydrogen Refuelling station would refuel 25 buses; it would require a minimum of 250 passenger cars to get amortized. I envision thus the passenger car market to stay quite a niche, at least for now, whereas heavy duty vehicles projects are growing in number: “1000-bus” project in France for public transport (by 2022), Trucks for logistics (by 2023), followed by Trains (by 2025), and eventually boats and airplanes - not necessarily using direct hydrogen, but combining renewable hydrogen with CO2 to generate bio kerosene (by 2030).”

The current development in Europe of Green hydrogen is ambitious and is now supported by public investment programs: While hydrogen share in European energy production is minimum today, Brussels has set the goal of increasing hydrogen to 12 or 14% of the energy mix by 2050, with a staged approach ramping from 6GW electrolyser capacity in 2024 to 40GW by 2030. Associated investment would be between 180 and 470 billion euros by 2050. “In France, The French Economy Recovery Plan includes an ambitious hydrogen plan with a 7-billion€ state investment dedicated to green Hydrogen, mainly through water electrolysis, with targets to deploy 6GW electrolysis”, said Lucas.

Moving on to the business side of things, we requested Lucas to elaborate on the market and business opportunities in the storage of hydrogen and understand which industry sectors are currently struggling on this front. Lucas clearly outlines that “Hydrogen Mobility is one important & growing segment, like stationary home use power-to-power applications, by transforming electricity into hydrogen (electrolyser) and then back to power (using a fuel cell) or by injecting green hydrogen in natural gas networks for heat building. But these 2 market segments will remain quite small in the short term, compared to the potential of hydrogen as feedstock in industrial processes, or Hydrogen as a renewable energy storage vector. For long storage options, Hydrogen will definitely be economically the most viable option for large-scale storage solutions. However, projects will need to move to larger scale as it is today, to reach 100 MW, or even GW scale. ”Hydrogen as a renewable energy storage vector is key as it supports renewable energies penetration in the Energy mix. Renewable energies are by essence intermittent, difficult to predict. Therefore, having more than 30% renewable energy in the Energy mix, makes it complex for the power grid to easily integrate such unpredictable power sources. Lucas states, “Large concentration of Renewable Energy sources (RES) countries like Denmark (36% via Wind energy) are also the largest CO2 emitters, as they need to complement their mix with coal or gas-power plants to mitigate RES shortfall. An alternative to this is to deploy large-scale Electrolysis plants to operate during off-peak periods when excess wind power is there and being able to stop during peak-power consumption times. Today’s large-scale electrolysis project opportunities in the North of Europe are announced but are still in the nascent stages, looking for grant funding schemes to secure investment for further development.”

On the other hand, the Industrial sector will be a large contributor to the deployment of Green Hydrogen. The industrial sector has long been a preserved sector for gas companies, selling their Hydrogen generated at cheap cost, but with a heavy carbon footprint (11kg CO2 emission per kg of H2 generated) – using steam methane reformers (SMR). Refineries, Steel, Ammonia for fertilizers, are some of the segments that typically used SMRs on site to produce large quantities of Hydrogen. Therefore, given the need to decarbonise transports industry and heating networks, SMRs are to be replaced with electrolysers.  Lucas highlights some recent examples in this space - “First large scale industrial demonstrators are in process of being deployed: (i) Refinery: Shell Wesseling Refinery (Germany) has deployed a 10 MW PEM electrolyser by ITM Power in 2020 and planning a 100MW extension; (ii) Chemicals: Linde Gas will install in Leuna Petro Chemical Complex (Germany) a 24MW PEM Electrolyser (ITM Power) in 2022. Additionally, Nouryon (Akzo Nobel) is designing a 20MW Electrolyser project in Delftzijl (Netherlands), (iii) Steel: ArcelorMittal is looking at producing green steel using green Hydrogen via electrolysis.”

To wrap up this insightful discussion with Lucas, we closely looked into Hydrogen making its in-roads into the transportation industry. We enquired about the significant changes needed in the transportation sector (railways, trucks, buses, shipping, aircrafts) in order to adopt hydrogen energy systems. According to Lucas, it will be “a combination of (i) increasing green electricity use, (i) larger scale fleet projects (transport), (iii) gigafactory industrialization- manufacturability, and (iv) subsidies schemes”. He clearly outlines that hydrogen would get faster deployment if we were to stop subsidizing conventional fossil fuels (Diesel), to enforce heavier taxes on CO2 emission in the transportation sector, i.e. constraints on polluting users and incentivize decarbonized transport. Massive grant funding schemes for hydrogen projects, both at EU and National levels, have been announced to support both the emergence of zero carbon technologies, and industrialisation of Green Hydrogen manufacturing capacities, i.e. giga factories to address 100 MW+ electrolysers, - like the 1000MW factory ITM Power recently opened last December 2020, and that other electrolyser providers will be deploying in a few years’ time-.

Given the latest developments of SNCF Voyageurs ordering the first hydrogen trains in France, we asked Lucas for his inputs on what is currently holding back this transition to Hydrogen trains across the broader European railways. Lucas comments, “Hydrogen Fuel Cell trains are foreseeable on railway lines which aren’t electrified yet.  It becomes a valuable decarbonized alternative to diesel trains, and cheaper than electric powered trains, as the cost of an electrification line is ~1M€+/km. But one train is “only” consuming 200 to 400 kg of hydrogen per day (approx). Therefore, there is a need for several fuel cell powered trains to enable an economically viable project. There is also a need to deploy a large infrastructure network along the train lines. The solution is to include trains hydrogen refuelling infrastructure in a full regional hydrogen ecosystem, mutualizing it together with other mobility or industrial requirements of Hydrogen.”


We would like to thank Lucas Bertrand for his precious time and guidance on this matter around Hydrogen production and storage systems. We hope you found these inputs useful as well.

Interviews with French Real Estate Experts

The real estate sector has had a significant impact with the ongoing pandemic. To better understand the developments & how things are expected to unfold in France and broader Europe, we interviewed our top French real estate experts. We sincerely appreciate their time and consideration during these interviews.



Mr Henry Buzy-Cazaux, has spent more than 30 years within the real estate sector. He is the founder president of the Real Estate Services Management Institute, one of the main training institution for real estate professions.




Mr Frédéric Monssu is the former Managing Director of Guy Hoquet L’Immobilier and Private Real Estate Services Managing Director of Nexity. He is now Vice President of AT-Ypique, a company which helps its clients to improve their commercial performances.



How is the real estate market in France currently performing? Are there any key trends to watch out for?

Mr. Buzy-Cazaux: “The residential real estate market in France should be analyzed by distinguishing between new and existing. Construction is currently experiencing its worst crisis since the last 30 years. In 2020, production did not exceed 376,000 housing units and barely more than 300,000 are expected in 2021, for needs estimated at a minimum of 450,000. This is due to a decrease in housing assistance of €4.3 billion in two years, degraded relations between the State and the Mayors (who are responsible for issuing building permits), Municipal Elections that have frozen projects, difficulty of acquiring land at a controlled price, instability of town planning rules and the slowness of the process for examining permit applications are the main obstacles. COVID-crisis has also raised the cost of construction sites and slowed down their execution.

In existing housing, after good market resistance in 2020, 2021 is already down 20% as the first quarter ends. Prices have stalled in the big cities and their near peripheries. Medium-sized cities are of much greater interest to households than before, with a desire for an improved quality of life and the possibility of remote working among individuals.”

Mr. Monssu: “It is commonly said that the criteria that make the real estate market more fluid are access to financing, jobs, and the French confidence index. The first 2 months of 2021 witnessed low interest rates, economic growth expected at + 5%, demand that remains strong and a lack of supply that is felt among transaction professionals (sellers probably waiting for better days to sell at the best price). In summary, the indicators seem to bode well, however, the decisions taken by the Banque de France to relax the conditions for granting loans may be a warning sign for a market that risks getting tougher. The impact of the health crisis, the economic and social crisis, which has not yet been measured, all the effects are amounting to uncertainties that do not facilitate the readability of the market. With economic and social fractures widening, many real estate projects could be abandoned or postponed. After health, the priority that remains more than ever is the prospect of employment and purchasing power. While the creditworthiness of buyers is the key criteria, trust remains one of the essential engines of the real estate sector.”


Looking at broader Europe, are the real estate trends similar in other European countries?

Mr. Buzy-Cazaux: “The other European countries are experiencing the same slowdown in the activity of resale of existing homes, or even steeper declines, especially those which have not safeguarded the purchasing power of households with powerful aid as France has. In contrast, most of these countries have better land use planning, and prices are more affordable in relation to household incomes. Finally, in European countries with economies comparable to France, new construction is more dynamic and responds correctly to the needs for renewal of the stock and to replenish it according to the needs created by sociological changes.”

Mr. Monssu: “The crisis has clearly changed buying and selling behavior in some European countries, as well as the support policy of central banks. However, due to my lack of deep knowledge of real estate in other European countries, I cannot give an informed opinion on the latest trends. I simply note that despite the crisis, Paris remains one of the most expensive capitals in Europe and France continues to stay ahead of European countries for the creation of new housing, two indicators which for me seem to represent the dynamics and the attractiveness of a country's real estate market.”



What were the consequences of the pandemic on the real estate market in France?

Mr. Buzy-Cazaux: “The pandemic first interrupted all construction and marketing activity. A small number of transactions took place digitally, partially for new homes and exclusively in the case of rentals. Activity was then able to resume, both on site and in agencies at the cost of strict health protocols. This significantly increased production costs, around 10%. This additional cost partly impacted the players' margins, but it typically passed on to the end customer. During the first months of the pandemic, the French undoubtedly saw the housing project as a way to preempt the future and to fight against the health abatement. In recent months, there has been the desire to invest and no doubt also the fear of a deterioration in individual situations that has left concerns in people's minds. More positively, the French are rethinking their relationship to work via teleworking, which before the crisis represented 8% jobs but now constitute close to 20% & is growing. They are also changing their outlook on housing, aspiring to a location that guarantees a greater quality of life, particularly in medium-sized regional towns and rural areas, with greenery and clarity, and an office.”

Mr. Monssu: “The health crisis is not having the same effects for all real estate professionals and buyers across various regions in France. The lockdown and the introduction of teleworking have had an impact on the selection criteria sought by buyers. New requests have arisen, such as: the search for more space, more light, but also the quest for a house with a garden. Paris experienced a decline in the number of transactions to the benefit of the Ile-de-France region and in particular the single-family home market. Regarding real estate professionals, there has been a significant increase in the number of independent agents, which has been linear for several years (on average +5000 agents / year), and whose number literally exploded in 2020 with nearly 40,500 agents. The explosion of this mode of distribution is certainly the result of the successive lockdowns which did not allow traditional agencies to be open but also digital networks such as Capifrance, IAD, Optimhome, etc.. which have facilitated the remote management of their agents and end customers. The so-called traditional real estate agencies which are estimated at nearly 27,400 at the end of 2019 (of which 93% have less than ten employees), suffered from forced closures, partial unemployment of their staff and also for the lack of digital tools (CRM, digitalized customer journey, electronic signatures,etc.) - making it impossible to manage "remote" relationships.”


The market share of agent networks in France is on the rise, in what ways can the major players differentiate themselves today?

Mr. Buzy-Cazaux: “We witnessed a high birth rate for agencies between 2017 and 2020, now numbering 300,000. At the same time, the model of agent networks is in fact actively developing and the fundraising of the French player (IAD) and other international leaders in this space, clearly outlines that economic observers and investors consider it promising. The growth rates of the top 5 players are between 15% and 30% per year, and this conquest is 2/3 in the over-the-counter market and 1/3 in the agency market.

The time for differentiation, after fifteen years of existence in France, has come for these players, for two reasons. They are first engaged in a merciless competition to attract advisers, who choose a particular brand. These advisers must then gain the trust of owner-sellers, or even lessors for rentals, if they want to have a sufficient portfolio. Brands are being built which use mass media, such as television, with considerable investments. IAD’s pyramid organization is not that of Keller Williams, halfway between agency and network, nor that of Safti. Package offers for sales agents are being refined, with training being at the heart of differentiation, such as digital tools. In this regard, these players have understood that they need to have marked technological advancements in this area, while traditional agencies are reforming digitally, in particular within large franchise networks.

Despite this differentiation at work, it cannot be denied that certain networks of agents will not succeed in standing out and will have increasing difficulties in asserting themselves on their territory against the leaders. The consolidation will obviously continue and the most large networks are now buying, external growth is also a growth accelerator for this model.”

Mr. Monssu: “In the world of real estate transactions, the latest major innovation dates back to the replacement of paper advertisements by online advertisements. The advent of data, algorithms, the acceleration of the digitization of processes and support could effectively once again create disruptions or at least "changes of focus" in the current operating methods of the major players. For example, the arrival of 100% online agencies offer their clients the same services as traditional agencies but with a fixed commission. Thus, the commissions or fixed prices of these new distributors of real estate services range from 2,590 euros to 1.99% of the sale price. Polls show that 65% of respondents find agency fees too expensive. In fact, 70% of French people try to sell their home themselves, but only 30% manage to do so, 5% of which with the help of their notary. The expectation of new commercial approaches therefore remains strong on the customer side, which leaves room for the search for differentiation. In addition to these new distributors of 100% online and "à la carte" services, there is a new breed service offer by ‘iBuyers’. The service here involves the seller providing details of the property he/she wishes to sell (online form), a price is offered immediately, the seller can accept or refuse it. If the offer to purchase is accepted, an expert will come on site to validate the information provided by the seller, and possibly complete the description of the property. Like Aramis in the automotive sector, the iBuyer will relist the property on the market with its distribution margin linked to marketing costs and above all to financial risks.”


Some companies have succeeded in distinguishing themselves thanks to their technological contribution, particularly in data management. Do you think this is the future of real estate? How could real estate develop further in the future?

Mr. Buzy-Cazaux: “To date, we have to be honest in recognizing that the digital technological advancement of proxy networks is insufficient and it is obviously in the area of ​​data mining that the fight must be waged. This work has barely begun. For example, in real estate, as in most other commercial sectors, we do not yet have the means to anticipate household purchasing trends, or the nature of their choices, which are often poorly expressed and subject to a very rudimentary form of customer discovery. Google is working on this data to catalyze the data processing efforts for real estate players. That said, GDPR compliance continues to remain paramount. In France, Seloger is today the largest producer of information on the real estate market and publishes thematic studies and detailed analyzes every week. This is potentially due to Google having developed high-level skills in the analysis of data relating to housing and household expectations, with a dedicated service created in Paris.”

Mr. Monssu: “Referring to the iBuyer concept mentioned earlier, this technique, born in the USA, has seen real estate players pivot on their model to provide this new service to their customers. For example, Zillow, a price estimation site and major portal across the Atlantic, became iBuyers in 2018. In France the Digit Re group has completed its range of services for independent agents by launching Dili, its brand of iBuyer. Moreover, in this country other evolutions can come from other players such as for example the Axel Springer groups (Logic immo, Se loger, MeillAgents) or Le Bon coin (acquisition of AVendre_A rent) which own a good part of the chain that allows to put a seller and a buyer in touch without going through the relationship of an intermediary. There, isn't the future of real estate in the age of disintermediation, just like many other industries? However, I personally believe that the distribution methods of tomorrow will be the points of convergence between a digital relationship initiated by the customer and a physical relationship with high added value. Digital is not an end in itself, it is a great opportunity to reposition people at the heart of the relationship. All the social systems developed and run by companies will aim to equip themselves with influencers and contributors on the net, allies to whom we give access to the knowledge base and who over time become ambassadors for the brand.”



What type of consolidations are possible in the coming months, within French real estate market?

Mr. Buzy-Cazaux: “Consolidations will most likely take place during 2021, not only targeting mid-size players in the transaction, but also with the buyout of leading operators. This movement will concern agent networks, but also real estate franchises. In this part of the real estate universe, consolidation began in the preservation of brands, with the takeover by Arche, the holding company of the Citya group, Guy Hoquet and Laforêt Immobilier. Another large-scale operation is expected to follow very soon.”

Mr. Monssu: “With more than 40,500 agents, France currently has more than 150 agent networks, of which the top 10 networks alone account for 50% of the number of agents. For controlled organization, the development of these networks will have to go through a necessary phase of network consolidation. This new model of distribution was first born in 2006 and on average these networks are about 7 years old. Therefore, this model is not yet mature and is yet to be perfect in its professionalism, its organization and its legitimacy. This optimization of the business will be supported by the resources provided during network consolidations.”

Digital Networks & Tech Enablement in Real Estate

Over the past few months, we’ve seen significant developments across real estate tech companies and digital real estate networks in Europe. The two standout developments include IAD Group securing over €300m in investment from Insight Partners and eXp Realty expanding its presence into France and Italy.

To better understand these trends and how this space is shaping up, we had an insightful discussion with Florent Couty, a leading expert with 20 years of experience in digital transformations, new technologies and information systems. Florent is currently the CEO of Alpha Vista, a consulting company specialized in digital and organizational transformation. Previously, he served as Chief Innovation and Product Officer at IaD International.

Florent feels that digital networks of real estate independent agents, which are mostly based on a Multi-Level Marketing (MLM) or via a sponsorship scheme, are enjoying a strong growth in France and are starting to prove their worth in broader Europe as well. He also states, “Despite the obstacles raised at the beginning by the traditional real estate industry, IaD has demonstrated that entrepreneurship, adapted fees and a fair distribution of profits was possible. Of course, the latest fundraising reinforces its European leader position and could set new operations within the industry.”

To dig deeper into the tech and operational side of this space, we asked Florent to help us understand the main aspects around building & running such information systems. At the outset, he emphasizes on the essentials, i.e. business introducer tools, CRM system with shared database, integrated transaction systems, electronic signatures, and if possible mobile application or a web ERP platform, supported by high availability environments. He also highlights that once the business reaches a certain size, Process Automation plays a critical role, i.e. from lead collection to the sale through invoicing or property advertisement diffusion. Lastly, the User Experience is vital in order to optimize transformation rate and productivity, this includes digitalization, intuitive user interfaces, etc… Furthermore, Florent concludes - “There are mechanisms that enable sharing and leveraging MLM (business, sponsorship, agents mobility) for a unique and fluid experience of running the business, including crossed offers/demands matching system, consolidated turnover follow-up in real time, adviser orientation and e-learning integration, Key Performance Indicators (KPI) for real estate managers, and the analysis of internal and external data to support an effective growth strategy.”

Speaking on the impact these tech enabled businesses would have on traditional real estate agencies, Florent says - “The competition and market shares won by real estate digital networks will push traditional agencies to evolve to stay in the race. They will have to succeed in gradually lowering their fees for equivalent service, either by grouping together in shared business centers or in larger branches to reduce fixed costs. However, as trust and reputation are key in the decision-making of sellers, it is possible that well-established historical players will eventually survive in this competitive landscape.” According to Florent, data plays a key role in the digital real estate space so as to be more efficient in terms of performance and development. He also believes that at the moment, execution around lead acquisition isn’t fully developed. However, when the competition gets tougher, these systems would have the advantage to reduce fees while supporting consultant activity because they will combine capabilities of the low-cost system for online automatic mandate taking and real estate agents covering the country. “What is certain is that once balance has been found among private sells, traditional real estate agencies and agent networks, the ecosystem will concentrate and become even more competitive because MLM networks are essentially based on the promise of growth to recruit and will have to find other strategies (individual performance, acquisitions or international) to continue their development”, says Florent.



Upon asking Florent to evaluate the chances of new players arriving in this market and dominating the market, we learnt that he is quite doubtful of the same. He notes that some attempts were already made in the past without success. Without a thoughtful strategy concerning development and competitive remunerations, it will be difficult to catch up to the current leaders which are benefiting from huge effects of scale. Moreover, it is a bit soon to consider possible consolidations in this market during the coming months in France or abroad. According to Florent, acquisitions will become a profitable solution in a few years when structural growth in market share will arrive at the inflection point.

To wrap up this discussion, we got Florent Couty’s concluding thoughts on how this space is evolving - “Many networks are now doing MLM, even without outrightly saying it. It is a fundamental trend. Compensation for business input and a culture of business sharing will also become a must. Finally, the technical and functional devices which will improve the productivity of agents and contribute to the timely service of clients, fully support the leverage effects of MLM. Fortunately for the market and for customers, there are many opportunities to improve the professional functions of this space, given that the digital disruption took place only a decade ago”.

We thank Florent Couty for his valuable time and inputs for this discussion. 

Current outlook and future of ESG investments

In recent years, the Environmental, Social and Governance (ESG) criteria has gained momentum among investors. With the ESG-based investment market set to double in 2021 & an additional 17 percent of investors planning to move to ESG in 2022 or later, the potential is clear for the market to grow in the coming years. To better understand these trends and how ESG investments are expected to develop, we spoke to Niall O'Shea


Niall has over 20 years of experience in the forefront of Sustainable and Responsible Investment. He previously led the division for Responsible Investment at Royal London Asset ManagementCurrently he leads his own venture, Discern Sustainability, specialising in ESG expertise for the world’s leading investors, corporate social responsibility organizations and environmental consultancies.


Given these upbeat trends in the market, investors believe now ESG issues are potentially material, as evidence is finding that smart ESG approaches tend to be additive to investment returns. The creation of new funds, indices and structures has enabled asset owners to allocate to different flavours of ESG across asset classes. Niall also adds, “Policy has been highly supportive and is now producing regulation, such as the EU Sustainable Finance Reporting Directive (SFDR). The biggest theme of all that will continue to drive risk and opportunity are sustainability challenges we face, that have gone from being seen as ignorable externalities to boardroom priorities”. From a geographical standpoint, we learnt from Niall that Europe has had the biggest impact with ESG investments. Reports suggest that Europe continues to lead, forecasting between two-to-four times growth in AUM in broad ESG styles, by 2025. Estimates from the US for broad ESG approaches are around $18 trillion, growing very strongly but this size reflects more the innate size of its market. For the APAC region, Japan is still growing strongly but Asia is still slow on uptake, with Australia and New Zealand more Europe-like in their approach.



There has always been concerns related to inconsistencies around ESG data from private markets vs public assets. We got some interesting comments from Niall on the same - “The data sets, choices and metrics for public markets are far more advanced and there is a prize for those that can ‘crack’ the private markets conundrum; which is to the extent that such data exists at all, it is not freely shared or commoditized. For investors in real assets, for example, some vendors are using combinations of remote sensing, big data and AI to assess, for example, the optimal places to put wind farms or assessing the physical vulnerability to climate change under different modelling assumptions. Prominent benchmarks like GRESB (Global Real Estate Sustainability Benchmark) are generating data and learning experiences that will eventually permeate the wider market.” Speaking of benchmarking, new measurements for ESG accountability are being considered lately. According to Niall, benchmarking has its uses in providing a desired objectivity to measurement and the visibility of progress or lack of. “When we mention benchmarking, we should think too in terms of regulatory developments like the low-carbon and Paris-aligned benchmarks being developed by the EU as part of the wider drive to bring scrutiny to what is being claimed by investors and companies”, says Niall. He also states that keeping benchmarks lean and focussed rather than platinum-plated, and learning from unintended effects is important to their usefulness and credibility. The regulatory impact on ESG-based investments is something to take into account as well. From March 2020, in-scope investors marketing funds into Europe will have to embark on a disclosure regime that will result in them tying their funds to particular minimum definitions of ESG integration, or sustainability objectives being core purposes of those funds, if applicable. The EU Taxonomy is the de facto look-up for precisely what economic activities the EU regards as making a ‘substantial contribution’ to the bloc’s environmental sustainability objectives. In addition to these inputs, Niall also says, “Investors seeking to make any claims for a fund’s environmental sustainability will have to state to what extent and how the Taxonomy was used to calculate the percentage of underlying revenues and capex that is ‘inside’ the taxonomy i.e. green. The US SEC is taking a keen interest in the SFDR development. We are in the sunset of the free-for-all era with no standards or accountability. I welcome this, even if regulation will inevitably have some unintended effects or fall short of its objectives.”



Lately, there has also been consistent talk around an ESG Bubble forming and questions like - can ESG investments provide a win-win scenario where they can help save the planet while netting positive returns? To learn more about this, we got Niall to share his candid views -

“There is a strong body of empirical evidence that inflecting ESG in how investments are selected and managed in equities produces better and more resilient long-term risk adjusted returns. Roughly three quarters of the studies we found support that view, but based only on the asset class for which there is the deepest dataset – equities. For other asset classes like fixed income and infrastructure, there is at least no evidence for financial harm from such strategies but the jury remains out on out-performance while the dataset remains spotty. However, surveys of institutional investors repeatedly show sentiment ‘spreads’ from the experience of equities. It is generally accepted that a security or asset with good ESG performance is, all other things being equal, a better, safer investment-and it is hard to dissent from this intuitive case. With this said, I do not subscribe to the view that ESG axiomatically leads to outperformance. A good ESG strategy will make a sound investment approach better, but it will not rescue a poor one. There are no magic bullets in investment and those who present ESG shallowly as some sort of set-and-forget formula for success, whether out of naivety or opportunism do harm. Unfortunately, there is a risk of a bubble Fear-of-Missing-Out and the ESG arms race means that inevitably lots of sub-par strategies that wear the cloak of ESG will go on to underperform. Then, there are those who say with some justification that some popular ESG assets are being bid up wildly higher than what their fundamental valuation would support. The counter-argument is that those valuations merely reflect confidence in a world that is going to be transformed by the sustainability imperative in a way that markets have failed to price in. While there is a risk of a bubble, I am sanguine about the longer-term picture in that once some of this froth is driven out of the market and a correction takes place, the fundamental drivers I speak of will still be there, but stronger.” 

To conclude this insightful interview with Niall, we asked him - to what extent does he see ESG-focused companies lead the post-COVID economic recovery?"This is a popular talking point but I am somewhat agnostic. COVID revealed our vulnerability and perhaps a partial preview of much worse down the line with climate if we do not act, as well as highlighting social inequalities. But people have short memories and a desire to consume. I think the bigger theme here is the further dematerialisation of the working world and supply chains and the normalisation of the duality of life: physical presence giving way to digital and remote delivery where possible, and that these distinctions will be increasingly blurred. It is true that companies popular in ESG funds: tech, pharma, new energy, are expected to benefit”, says Niall

We sincerely thank Niall for his time and valuable inputs on this topic related to ESG investments. We are confident that our readers will benefit from his insights provided here.


Opportunities & Expectations - Payments Industry

In a recent article by Finextra, it is understood that the Covid crisis had a significant impact in the payments industry during 2020 and this is expected to continue ahead. 74% of consumers are likely to consider switching to competing payment solutions. This is precisely why payment service providers have a coveted position in the market currently. To comment on these developments and what to expect, we spoke to Bishwajit Choudhary.

Bishwajit is currently the Executive Vice President at Zwipe, a provider of biometric payment cards platform, pioneering the next generation of contactless payment. He formerly served as Senior Vice President of Strategy at Nets Group, leading provider of payment services in Europe. Bishwajit has two decades of payments experience where he led many new business initiatives notably within Digital-ID, Open banking, Customer advisory and International expansion.

Responding to our query about the challenges the industry faces, Bishwajit highlights that the fall in in-store payment volumes will impact the revenues of processors and issuers. In addition, due to macroeconomic uncertainties, new deals & innovation are currently stalled. Bishwajit categorically mentions that interest in biometric payments will continue to rise due to increasing worries among consumers on in-store payment hygiene and concerns related to touching of the POS in shops. “The merchant segments mostly hit by COVID-19 (e.g., hotel, travel, hospitality, luxury retail) are going to do anything and everything to cut down their expenses. Fintechs, neo-banks and new generation processors born out of the PSD-II storm should target the adversely affected merchant segments and deliver value propositions targeted to driving retention and new customer acquisition through deeper insights in customer spending, targeted marketing, campaign management and more seamless e-commerce”, said Bishwajit.

According to Bishwajit, going forward, as more people take greater control of their financials and outgoing payments, one must expect a stronger market reception for micropayment solutions where one pays for the value consumed for example; pay-per-view, pay-per article, pay-per-stream. Content providers see this as a smart way to attract consumers who may want to discontinue their “flat subscriptions” and take more control of their finances. For payment providers, getting a deeper understanding of these priorities will be very important. “We can expect a more open mindset from financial institutions and retailers to diversify and shift from costly card payments to Account-to-Account (A2A) platforms, which are also fast transforming into real-time payments. How are these verticals preparing to reduce the costs of payment handling? How do they assess a potential shift from Cards to A2A platforms and what are their biggest concerns? Understanding these insights ahead of proposing solutions for these retailers would greatly help payment processors and issuers to act as helpful partners”, said Bishwajit.



In November 2020, the Italian company Nexi formulated an offer to merge with its Danish competitor, Nets. Earlier in the same year, Ingenico Group was bought by Worldline. This led to European players competing with other top performers - a space dominated by American companies, i.e. Fiserv, FIS and Global Payments. According to Bishwajit, the payments market, particularly the processing sector, is marked by overcapacity. New payment volumes are becoming harder to capture. Consequently, M&As and consolidation allow these players to drive efficiencies on the back-end platforms and release commercial value (read margins) as the price pressures continue to pile up. Bishwajit also expects major payment processors to acquire (or partner with) FinTechs to drive differentiation and innovation. Supporting alternative payment methods, strengthening KYC / security and improving user experience are the areas to watch out.

On European and American processors, Bishwajit says, “For the large players, the battle will not be in each other's markets (USA or Europe) but Asia and LATAM. Both these regions offer massive volumes, high growth potentials and big potential to drive cash-to-card / A2A payments”.

To wrap up our discussions, we asked Bishwajit about his insights on global tech giants, i.e. GAFAM (Google, Apple, Facebook, Amazon, Microsoft) and also China inspired BATX (Baidu, Alibaba, Tencent, Xiaomi), being the main challengers in the payment industry. He concluded, “Most of these players continue to use the existing card platforms and indirectly “feed volumes” to the processors mentioned above. As long as these tech giants do not proactively in-house payment processing, the impact on the “old world processors” will remain limited. Most of these players prefer to play “at a higher level in the value chain” focusing on data play and user experience while reusing the KYC / payments infrastructure created by issuers”.

We would like to thank Bishwajit for his valuable time to speak with us on this subject. His expert inputs, supported by his extensive experience in this space, has helped us better understand where the payments industry is headed.

XC Talks: Stanislas De Quercize on how the luxury industry can rebound

      XC Talks: Stanislas De Quercize on how the luxury industry can rebound

In this webinar, Stanislas de Quercize, former CEO of Cartier, of Van Cleef & Arpels and former CEO of Group Richemont France, discusses the impact of the Covid-19 crisis on the luxury industry, the strategies that brands should incorporate to bounce back.

He also explained how the second-hand market is an opportunity for the industry, and the benefits that can come from partnering with start-ups in the industry. 

The luxury market post Covid-19 rebound

The luxury market post Covid-19 rebound

The ongoing sanitary crisis has been a major source of change to the way business is done in today's world. It has been and is the responsibility of world leaders to navigate this crisis, rebound, find quick and applicable solutions and plans and strategies for the future.

In this interview, Stanislas de Quercize, former CEO of Cartier International, Van Cleef & Arpels and Group Richemont France, shares his thoughts on the impact of COVID-19 on the luxury market.

Xperts Council: The COVID-19 pandemic has made it a challenge for several companies to keep thriving. How did it affect the luxury market?

Stanislas de Quercize: The COVID-19 was the most challenging crisis ever in the luxury market due to two main reasons. The first being the boutiques closing during the lockdown, the second is the travelling restrictions that made it a challenge for these luxury boutiques to thrive even in a post lockdown period as its first source of sales is tourists. And hence, profit for the luxury brand has dropped significantly.

XC: Do you see any area in luxury retail thriving more than another? 

Stanislas de Quercize: Prior to this sanitary crisis luxury sales have reached unprecedented levels of growth, that was, later on, slowed down by the COVID-19. Nevertheless, the luxury market growth is expected to pick up soon, and that is due to the fact that through sanitary crises as such, people start appreciating life more and therefore tend to share the love and friendship through gifting as a form of gratefulness.                             

I recall that back in the time following the tsunami disaster in Japan. There was a surge in Jewellery sales as the Japanese realized that they are mortal and that they should enjoy the gift of life. 

Regarding the areas that would surge, digital is one with much potential as before the global lockdown it represented only 5% of total sales, whereas during the lockdown it has increased to 100% in countries where retail was closed and now it should reach between 25% and 30%.

Moreover, the second-hand vintage market is also going to thrive as it represents a source of sustainability to luxury brands as the integration of second-hand markets within the companies should be essential, which will enable them to grow in the market of carbon-neutral luxury.

XC: In July, the men's fashion week in Paris was entirely digital, do you think that digital will be a big part of the new normal?

Stanislas de Quercize: Digitalization is a form of the accelerator, we can see that through the Louvre and, as a board member of the American Friends of the Louvre, I witnessed the Louvre averaging 10 million visitors a year whereas during the lockdown with the digitalization of the visit, the number was multiplied averaging 10 million visitors in 2 months proving that digitalization is a fabulous accelerator to reach out to people.

Another example is Louis Vuitton. They were averaging 1 million in audience per show and by moving to digital they averaged 10 million views for their show in Shanghai and therefore we can see the key role digitalization is playing in reaching more people.

It is also important to point out that the crisis has made it an opportunity for several start-ups to offer great rebound solutions for the “maisons”. The growth of these start-ups will create a solid digital eco-system around the luxury market.

From the corporate side, we can also notice several start-ups making their way into becoming important pillars in the development of the luxury market.

Luxurynsight created by Jonathan Siboni, for instance, is a business intelligence, data company for the luxury market, the Bloomberg of the luxury world, as it clusters and reprocesses data from 2000+ sources to provide quantitative, factual and strategic decision-making tools that will help luxury companies improve the understanding of their brand, competitors competitive advantages, and their consumers and represents their real GPS to navigate the future. 

Moreover, Place2Swap created by Estefanie Larrañaga & Lucie Soulard is a start-up that is reimagining luxury through its platform as it is the first white label Re-commerce platform that allows brands to integrate second life into their business model and reduce the impact of reverse logistics.

Furthermore, Oktave a company created by Frederik Schreve to help global retail brands develop opportunities for enhanced in-store customer experiences and sustainable revenue generation through consultancy services, training and digital tools.

It is key to further improve the clients' experience with better trained and motivated retail teams, that is what Oktave delivers. Payment start-ups will also play an important part in the rebound as well through companies such as Cresh, a financing solution created by Matthieu Girard, which allows consumers to pay their shopping carts in several instalments making luxury more accessible to consumers.

Finally, lately, we have been noticing the growing importance of finding solutions for a better impact on the environment. We can see that through the growth of ReValorem a French start-up created by François-Marie Barrès & Eric Legent that specializes in the reuse, recovery and recycling of unsold products for the luxury sector.

XC: Will this sanitary crisis impact consumer behaviour?

Stanislas de Quercize: We can notice the impact of the sanitary crisis on consumer behaviour through several changes happening to the market. First we will soon notice market growth, thanks to people wanting to share love following a crisis and therefore demand for luxury items that would be destined for gifting or personal use is going to increase.

Moreover, consumers will be more ethically demanding towards the luxury groups, Maisons and brands which will incite them to invest more in its sustainable growth strategies. 

Furthermore, the COVID-19 crisis will be an important accelerator of digital in the retail luxury market as mentioned earlier, luxury brands will invest massively in digitalization.

This would allow seeing new trends in their seasonal shows, their marketing, e-commerce and payments as we expect to see more and more luxury brands to adapt instalment payments on their websites, where buyers could have the opportunity to pay in several times.

Finally, we noticed lately that consumers are shifting to the vintage second-hand market resellers, to buy and sell their luxury items. The growth in this market represents an opportunity for luxury brands to allow them to be closer to the client through the integration of manufacturing, wholesaling, retailing, e-commerce and now re-commerce.