Moves: Lombard Odier adds L/S duo; Polar Capital seeks global PMs
Fidelity may jettison star culture
Fidelity Investments is considering moving away from its historical star fund manager model, where junior analysts act as subordinates to lead managers, in favour of a team approach.
An external consultant began a review last year of behaviour within the equities division of Fidelity, following allegations of misconduct, Financial News reported. Senior managers, including CEO Abigail Johnson, have been discussing making changes to improve Fidelity’s culture and the firm has formed advisory teams, bringing together top executives with other asset management staff. One suggestion on the table is putting fund managers and analysts on a more equal footing when it comes to selecting stocks.
Fidelity is also considering changing how its analysts are compensated. At present, fund managers vote on analysts’ performance, which has an impact on their pay. As a result, some junior analysts have felt under pressure to curry favour with fund managers, for instance by withholding objections to their investment ideas, The Wall Street Journal reported.
“As part of a culture survey conducted several months ago with employees from across Fidelity’s asset management organization we established advisory teams, made up of senior leaders and employee volunteers, focused on discussing several identified opportunities,” said spokesman Vincent Loporchio. “The fact that the advisory teams were established and are meeting is not an indication that any decisions have been or will be made. We are simply doing what we have always done—engaging with associates and having open discussions about areas of the business we can continue to enhance.”
CMA finds consultant fees opaque
The Competition and Markets Authority (CMA) has voiced concerns about fee transparency and competition in the investment consulting and fiduciary management sectors. In particular, fiduciary managers are not offering their defined benefit pension clients sufficient, regular information on third-party fees, such as those levied by asset managers, the watchdog asserted.
“The evidence reviewed so far indicates that competitive processes are not providing customers with the necessary information to judge the value for money of investment consultants and fiduciary managers,” the CMA wrote in a working paper published yesterday (the first in a series it plans to publish ahead of announcing a provisional verdict in July.) “The potential competition concern with this is that customers are not well-equipped to choose, and subsequently monitor the performance of, their provider and in turn to drive competition between investment consultants, and between fiduciary managers.” Only half (56 per cent) of 966 pension trustees polled said it was easy to understand and compare consultants’ investment track records.
The CMA, which began investigating consultants last September after a referral from the Financial Conduct Authority, said fee transparency is “in general below the standards which ought to be achieved through effective competition.” To remedy the situation, it suggested providing guidance or setting requirements around fee and performance reporting.
Standard Life Aberdeen caps CEOs’ pay, reveals gender pay gap
Standard Life Aberdeen (SLA) is introducing new limits on its joint CEOs’ compensation and has revealed its gender pay gap.
SLA’s remuneration committee has proposed capping Keith Skeoch and Martin Gilbert's total compensation at £4.3 million a year, down from £4.9 million and £5.7 million, respectively. “The level of remuneration for executives remains under intense scrutiny from shareholders and their representatives, the government and the general public,” SLA explained in its 2017 results announcement. “With the introduction of the new remuneration structure and alignment of the remuneration for our co-CEOs, we have reduced the maximum opportunity.”
Skeoch’s £700,000 base salary will be reduced to £600,000 and his maximum bonus will be curtailed by 11.8 per cent. Gilbert’s bonus will be capped at 600 per cent of his fixed pay, down from 1,000 per cent. Bonuses will be dependent on a range of factors including investment performance, inflows, profits, and non-financial objectives.
Skeoch earned £3 million last year, including a bonus of £1 million, long-term incentives worth £1.1 million, and pension allowance of £175,000. Gilbert's base salary is £525,000 and he took home £4.3 million last year.
Separately, SLA disclosed its gender pay gap of 34 per cent for Aberdeen Asset Management and 42 per cent in the Standard Life Group, as of last April. “This is an area in which we want to perform better,” the firm stated. “Our pay gap is primarily driven by the fact that we have more men than women in our senior roles. We are committed to improving our gender balance, and we believe progress here will positively impact our business, our industry and our society.”
SLA has set targets for 33 per cent of its board and senior management to be female by June 2020, up from 25 and 27 per cent at the end of last year, respectively. Women comprise 44 per cent of people expected to ascend to the firm’s most senior roles within the next three to five years. Almost half SLA's staff are female (47 per cent) today and the target is 50 per cent by 2020.
Aegon to launch multi-manager
Aegon intends to establish a multi-manager investment company later this year called Aegon Investments. It will launch a range of OEIC funds that will be made available to intermediaries via Aegon’s platform. “The platform will remain open architecture and [the new funds’] addition is about providing intermediaries with further choice,” an Aegon spokesperson told Investment Week.
Cofunds’ CEO David Hobbs has been appointed Managing Director for Investments and CEO of Aegon Investments. Aegon’s UK CEO Adrian Grace will take over the leadership of Cofunds, which Aegon acquired in 2016. “There's a great deal of investment expertise within Cofunds and as we move from a life and pensions company to a broader investment platform business, David will use his undoubted skill to grow our investment business, including the new Aegon multi-asset fund range,” Grace said.
Aegon announced further leadership changes to bolster its digital solutions business. Mark Till, Chief Distribution and Marketing Officer, will move into a newly-created role as Managing Director for Aegon Digital Solutions. Aegon has hired Ronnie Taylor from Scottish Widows to replace him and run distribution. COO Richard Denning will become Chief Transformation and Digital Officer.
“In 2016, we split our business into two, creating a new Digital Solutions business with some of the latest technologies and digital applications, including our investment platform. We now have the infrastructure, scale and momentum in place, making it an appropriate time to appoint a managing director for this business,” Grace said of Till’s promotion.
Aberdeen Standard, Jupiter to build Brexit hubs
Aberdeen Standard Investments intends to establish an investment and distribution hub in Dublin, while Jupiter Asset Management is expanding its presence in Luxembourg, as both firms prepare for Brexit.
"The Irish hub, which will contract directly with European clients and oversee our European branches, complements our Luxembourg hub which manages funds across Europe," said Gary Marshall, Head of EMEA at Aberdeen Standard Investments. "These two businesses, working together and with our German business based in Frankfurt will ensure that we continue to meet the needs of our customers and clients across Europe, after the UK leaves the European Union.”
Managing Director Victoria Brown, who previously led Aberdeen's Luxembourg division, will run the Dublin hub. She will work alongside Jennifer Richards, Head of Distribution for Ireland.
Meanwhile, Jupiter Asset Management is expanding its presence in Luxembourg and is recruiting for some senior posts, according to Delano. The firm is looking for new premises and seeking the necessary regulatory approvals.
Tugrul Kolad, Head of Credit Quant at Amundi in Munich, has been given the additional role of Head of Fixed Income Germany. Separately, Cristina Matti has become sole Head of European Small- and Mid-Cap Equities and Country Strategies, following the departure of co-head Caroline Gauthier.
Amundi has also appointed Stéphane Taillepied as Corporate Engagement Manager; he was Head of Equity Financial Analysis.
Barings Real Estate has hired Guillaume Bieganski as Director, Asset Management & Transactions, and Daniel Köhler as Director of Debt Capital Markets, Structured Real Estate Investments in Europe. Bieganski, who is based in Paris, was a Director at Abenex (formerly ABN AMRO Capital France) and before that, a Portfolio Manager for Standard Life Investments. Köhler was an Associate Director in structured debt finance at Invesco Real Estate and is based in Munich.
Matt Hougan has joined Bitwise Asset Management as V.P. of Research & Development. He was CEO of Inside ETFs and before that, CEO of ETF.com.
BMO Real Estate Partners in Paris has hired Lea Castelli from Cushman & Wakefield as European Retail Manager – Food & Beverage, and Nadia Baïleche from TH Real Estate as European Asset Manager.
ClearBridge Investments has brought in George Antonak from Harding Loevner in New Jersey as an Institutional Sales Manager.
Annabel Tonry, a Client and Consultant Adviser in the UK DC team at JPMorgan Asset Management, has been appointed Chair of the DC Investment Forum. Vivek Roy, who leads AXA Investment Managers’ global pensions business development projects, has been named Vice Chair.
Fidelity International has hired Kim Politzer as Research Director for its European real estate business, based in London. She was a Senior Director of European Research at Invesco.
Franklin Templeton Investments has hired BlackRock’s Erika Arevuo as Head of Institutional Marketing in London.
Invesco has appointed Alex Millar to Head of UK Institutional. He previously led Invesco’s sovereign, Middle East and Africa institutional business and will continue to work with sovereign clients. Zainab Kufaishi has been promoted to Head of Institutional Sales for the Middle East and Africa.
Investec Asset Management has hired Philip Anker as a Managing Director, heading up its North America business. He was Insight Investment Management’s Global Head of Distribution.
Arnaud Langlois and Cyrus Azarmgin have joined Lombard Odier Investment Managers, where they will launch a global equity long/short investment strategy with a sustainability focus. The duo set up Terreneuve Capital last July after working together at Millennium Management and UBS O’Connor.
Mirabaud Asset Management has hired Elena Villalba from Merchbanc to oversee business development in Spain, Portugal and Latin America.
Polar Capital plans to hire global and emerging market portfolio managers to launch new strategies. "For long-term growth we need to add teams to try to diversify the business. We are looking to add capacity,” new CEO Gavin Rochussen told Investment Week.
Tatton Investment Management has hired Retirement Advantage’s Justine Randall as a Sales Director.
Willis Towers Watson has named Roger Steel as Managing Director for Hong Kong and Macau. He is a former CEO of Sun Life Hong Kong.
Fraser Blain has joined Zurich UK as National Investment Development Director, a new role. He was previously Head of UK Retail Distribution at Allianz Global Investors.