A SHEFFIELD HAWORTH PUBLICATION A summary featuring people news, industry updates with market trends and analysis EUROPEAN ASSET Patrick Morrissey MANAGEMENT Charles Bruce-Smythe Henry Spence 2019 Peter Hughes Tom Eagar Henry Milton
2019, Asset Management Overview – Europe
MARKET OVERVIEW
Despite headlines warning about the damage of Brexit, trade wars, tariffs and a global slowdown, Sheffield Haworth has seen robust hiring across the market in 2019. Hiring distribution leaders continues apace, despite the likes of Aberdeen Standard Investments letting entire teams go, though this year has seen an emphasis on the institutional side. ESG hiring demand continues to grow and as regulation and client expectations are raised and demand is outstripping supply. Hiring in investment is still strong, with firms looking for growth hires as well as replacement hires. Finally, we have continued to see the growth in private markets, particularly on the institutional side, as investors continue to search for yields in a pressured and competitive environment. In short, it is business as usual.
▪ In light of liquidity challenges in Woodford’s flagship open TABLE OF CONTENTS ended Equity Income Fund, as well as others, Mark Carney has announced a new regulatory focus on investment trusts. Market Overview ▪ Fallout from the Aberdeen Standard merger continues, with Business Development swathes of redundancies (including the entire wholesale sales team), drastically cut bonuses, Martin Gilbert stepping - Institutional down, continuing outflows and a shareholder revolt over executive pay. - Wholesale
ESG “…ESG hiring demand continues to grow… and Investment and Product demand is outstripping supply…” - Equities
- Fixed Income ▪ Legal & General Investment Management appointed Michelle Scrimgeour as Chief Executive, joining the growing - Multi-Asset ranks of female CEOs in the City.
- Alternatives ▪ Andrew Formica replaces Maarten Slendebroek as CEO of Contact Details Jupiter Fund Management, as their Head of Distribution Nick Ring becomes EMEA CEO of Columbia Threadneedle, who is in turn replaced at Jupiter by Phil Wagstaff, a former colleague of Formica.
▪ USS announced that Simon Pilcher, former Head of Fixed Income at M&G, will take over as USSIM CEO in October, when the current CEO Roger Gray is set to retire.
This is a private and confidential document prepared by Sheffield Haworth
2019, Asset Management Overview – Europe
SELECT LEADERSHIP & BOARD MOVES:
Alquity have hired Brad Crombie as Chief Executive Officer. He was previously Global Head of Fixed Income at Aberdeen Asset Management
BNP Paribas Asset Management hired Rob Gambi as Global Head of Investments, sitting on the Executive Committee. He was most recently at Henderson Global Investors as Chief Investment Officer
CFA Institute, the professional body for investment professionals, appointed Margaret Franklin as Chief Executive and President. She was most recently at BNY Mellon as President of Wealth Management
Fidelity International hired Andrew McCaffery in a new role as Global Chief Investment Officer for Alternatives and Solutions from Aberdeen Standard Investments where he was Global Head of Strategic Client Investment
Hawksmoor Investment Management appointed Sarah Soar as Chief Executive. She was previously Head of Investment Management at JM Finn
Munich Re have appointed Nick Gartside as Chief Investment Officer and Member of the Management Board from JP Morgan Asset Management where he was International Chief Investment Officer of Global Fixed Income, Commodities and Currencies
Newton Investment Management announced Kevin Carter as an Independent Non-Executive Director. He was previously Chief Executive Officer of Old Mutual Asset Management in the US and UK
Pictet Asset Management appointed Nobel Gulati as a Non-Executive Director. He was most recently Chief Executive of Two Sigma before this
Polar Capital have appointed Sandy Black as Chief Investment Officer from JO Hambro Capital Management where he was Investment Director
BUSINESS DEVELOPMENT
Hiring across distribution has been strong, as firms continue to upskill their teams. As the client base becomes increasingly more sophisticated, asset managers are looking to hire more technical sales professionals who have a demonstrable understanding of the underlying product as well as the breakdown of client’s portfolios.
Challenges and Opportunities
Historically, the institutional market, both from a direct sales and consultant relations perspective, was focused more on relationship management versus technical understanding of product. As such, there is disparity in the quality of candidates from an intellectual perspective.
The emerging theme we have seen within the institutional market is that the best rated sales professionals have been the ‘up-and-comers’ rather than the individuals with 20+ years of experience. The former now tend to reference as having greater technical abilities and as more ‘solutions orientated’ in their approach to clients. Firms are increasingly looking for solutions-based sales leaders, moving away from the more traditional transactional model.
This is a private and confidential document prepared by Sheffield Haworth
2019, Asset Management Overview – Europe
INSTITUTIONAL
SELECTED PEOPLE MOVES:
Aviva Investors have appointed Steve Castle as Head of UK Consultant Relations from Pictet’s Consultant Relations team
Blackrock have appointed Sion Cole as Head of Distribution, UK Fiduciary Management from Aon where he was Head of Sales & Distribution for consulting services EMEA
BMO Global Asset Management have appointed Jurgen Florack as Head of Institutional Distribution for Germany from GAM, where he was a Managing Director for Sales
Janus Henderson Investors have hired Suzanne Cain as Global Head of Distribution from BlackRock where she was US and Global Head of Institutional Clients, iShares
Legal & General Investment Management have appointed Lisa Purdy as Head of Fiduciary Distribution from Lloyds Bank, where she was Corporate Pensions Director
M&G have hired Ingo Matthey as Head of Institutional Business Development for Germany from Wells Fargo where he was a Sales Director
Natixis Investment Managers have hired Andrew Benton as Head of Northern European Business from State Street Global Advisors, where he was Head of UK Institutional Sales
Newton Investment Management have hired Jin Philips as Head of Strategic Relationships EMEA from Secure Insights, where she was in Client Strategy & Solutions for Consultants
Oaktree Capital Management have appointed Caroline Martin-Glinel as Head of EMEA Consultant Relations from OZ Management, where she had the same role
WHOLESALE
SELECTED PEOPLE MOVES:
Amundi have appointed Pascal Duval as Head of Retail Solutions from Russel Investments where he was Chief Executive Officer
BNY Mellon have appointed Michael Beveridge as Head of Intermediary Distribution. He was most recently Head of UK Wholesale at Aberdeen Standard Investments
HSBC Global Asset Management have hired Fay Hendon as Head of UK Intermediary Business Development from Aviva Investors where she was Head of Advisory Sales
This is a private and confidential document prepared by Sheffield Haworth
Q1, 2019 Asset Management Overview, Europe
Martin Currie have appointed Barry MacLennan as Head of Wholesale Distribution from Aberdeen Standard’s Wholesale Management team
Muzinich & Co have hired Tom Douie as Global Head of Distribution from Neuberger Berman where he was Head of Intermediary, EMEA and LATAM
Neuberger Berman have appointed Jose Cosio as Head of Intermediary Client Coverage EMEA & LATAM from Alliance Bernstein where he was in Business Development
Square Mile Investment Consulting & Research have hired Steve Kenny as Commercial Director from Kames Capital where he was Director of European Wholesale
RELATED HIRES:
Franklin Templeton have appointed Rita Pfahls as Deputy Head of Institutional Sales from Universal Investment where Rita was Head of Servicing Companies & Pension Funds
Fulcrum Asset Management have hired Howard Fryer as UK Wholesale Sales Director from Fidelity International where he was a Business Development Director
PIMCO have appointed Patrick Beuret as EVP, Country Manager for Switzerland having had the same role as a Managing Director at JP Morgan Asset Management
Schroders have appointed Gillian Hepburn as UK Intermediary Solutions Director from Embark Group where she was Head of Strategic Partnerships
Aberdeen Standard Investments have hired Fergus McCarthy as UK Distribution Director for Regional Accounts from BNY Mellon where he was Head of UK & Ireland Intermediary Distribution
T.Rowe Price have appointed Marcus Gibbon as Head of Discretionary Sales for UK & Ireland having previously held the same role within the Aberdeen Standard Investments Wholesale Sales team.
Willis Towers Watson have appointed Anne Swift as Senior Director, Advisory Investments, DC from KPMG where she was Head of DC Investments
SH Selected Track Record 2019
Head of Marketing UK Asset Manager European Salesperson Asset Manager Senior Sales Director, Swiss Wholesale UK Asset Manager UK Institutional Sales Director Scandinavian Asset Manager UK Institutional Sales US Asset Manager Head of Institutional Sales UK Asset Manager Head of UK Wholesale UK Asset Manager UK Institutional Sales UK Asset Manager Consultant Relations Director UK Asset Manager
This is a private and confidential document prepared by Sheffield Haworth
Q1, 2019 Asset Management Overview, Europe
ESG
ESG has been the buzzword in asset management for the last few years, but 2019 will almost certainly be known as the year ESG exploded and became a permanent presence in the world of investment management. A combination of moving public sentiment, increasing awareness of ESG and growing regulation has pushed ESG right to the fore. In the UK specifically, the announcement by UK Work & Pensions department that by October 1st, 2019, pension schemes will be forced to disclose the risk of their investments, including those arising from ESG considerations, has generated a significant amount of demand for candidates with ESG implementation experience.
Challenges and Opportunities
The overriding challenge for hiring ESG talent is that it is a particularly tight market as it is a relatively new expertise. As such, demand has outstripped supply and that is reflected both in significant increases in compensation for recent movers and an increase in appointments from outside the industry, including consultancies, central banks, and even the UN.
This has also contributed to a dilution of ESG leadership talent as firms and people re-label themselves as ESG experts in an attempt to stay relevant.
There are opportunities, however. ESG has become a vital component of sales, particularly institutional. Other market participants believe we are in a window where the way equities are valued is fundamentally changing, and soon the entire market will build ‘sustainability’ into their valuation. The firms that understand this could gain a new investment edge.
SELECTED PEOPLE MOVES:
Artemis Investment Management appointed Antonia Stirling as Co-Head of Stewardship from Aberdeen Standard Investments where she was Head of Corporate Stewardship
BNP Paribas Asset Management hired Jane Ambachtsheer as Global Head of Sustainability from Mercer, where she was Partner and Chair of Responsible Investment
Lazard Asset Management have hired Nikita Singhal as Co-Head of Sustainable Investment and ESG from ClearBridge where she was a Portfolio Analyst
Majedie Asset Management have appointed Cindy Rose as Head of Responsible Capitalism from Aberdeen Standard Investments, where she was Head of ESG, Clients & Products
NN Investment Partners have appointed Edith Siermann as Head of Fixed Income Solutions and Responsible Investments from the Dutch Central Bank, where she was Chief Investment Officer
St James’s Place appointed Emma Hunt as Head of Responsible Investments from Hermes where she was Co-Head of EOS
The Pension Protection Fund hired Claire Curtin as Head of ESG from the S&P Dow Jones Indices where she was Head of Research for Financial Institutions
This is a private and confidential document prepared by Sheffield Haworth
Q1, 2019 Asset Management Overview, Europe
INVESTMENT AND PRODUCT EQUITIES
Areas of growth
While equities hiring continues to be strong, we have noticed a significant increase in interest and movement in the global emerging market equities sector over the past six months. After a very challenging 2018, where the best performing GEM fund was an ETF, firms are seeing opportunities to take on underappreciated teams.
Challenges & Opportunities
Despite the macro headwinds, the equities environment appears to be confident, with a number of portfolio managers at the bigger firms striking out on their own or at smaller boutiques. Alexander Darwall left Jupiter in June to set up his own boutique, Devon Equity Management, and Glenn Finegen lead his team out of Janus Henderson in April to do the same. This poses a challenge for the bigger asset managers as their size can preclude them from the nimbleness that is increasingly required to generate the necessary alpha to satisfy investors, who seek ever increasing returns to justify the fees required by active managers.
SELECT PEOPLE MOVES:
GAM Investments have appointed Rob Mumford as a Global Emerging Market Equities Investment Manager from MNP Advisors where he was a Managing Partner
Jupiter Asset Management have appointed Mark Heslop to launch a European Small Cap Equities fund. He was previously at Columbia Threadneedle Investments as a portfolio manager
Jupiter Asset Management also appointed Mark Nichols as a European Equity Manager from Columbia Threadneedle, where he was Co-Manager of the European Select Strategy
Legal & General Investment Management appointed Claire Aley as Head of Product and Investments Business Management from Hermes Investment Management where she was Head of Product Strategy and Development
T Rowe Price have hired Colin McQueen as an International Value Equity Portfolio Manager from Sanlam Investments where he oversaw the Global Equity Division
SH Selected Track Record 2019
Global Head of Equities European Asset Manager Head of Global Equities Bank-Owned Asset Manager Long Short Equity Analyst – Financials US Asset Manager MENA Equity Analyst Sovereign Wealth Fund Lat-Am Equity Analyst Sovereign Wealth Fund Global Infrastructure Equity Analyst Oceania Asset Manager European Industrials Analyst European Asset Manager Equity Investment Specialist US Asset Manager Global Energy Analyst UK Asset Manager Global Equity Portfolio Manager International Asset Manager GEM Equity Team Build UK Asset Manager European Equity Portfolio Manager UK Asset Manager
This is a private and confidential document prepared by Sheffield Haworth
2019 Asset Management Overview, Europe
FIXED INCOME
Trends
Q1 in 2019 in fixed income has continued to see big growth in private credit (see below). In the public sphere, it has been quite clear that as political tensions across the globe increase, there has been a focus on much more macro-orientated roles and products, which can be seen in our track record this year.
Challenges & Opportunities
Similarly, as an inevitable response to the continued low-interest rate environment, combined with the ever more pressing need to differentiate active management as alpha generating, we have seen increased interest in Absolute Return style funds, particularly following the widely reported success of H20 AM, at least, until some of its illiquid positions were called into question.
SELECTED PEOPLE MOVES:
Amundi have appointed Gilles Dauphiné as Head of Euro Alpha Fixed Income from AXA, where he was Global Head of Buy and Maintain Fixed Income
Amundi have appointed Richard Deutsch as Head of Credit Research from HSBC Global Asset Management where he was Global Head of Credit Research
Amundi have also appointed Ryan Myerberg as Head of Absolute Return, Global Fixed Income from Janus Henderson where he was a Senior Portfolio Manager for Global Macro & Global Credit Strategies
Kames Capital have hired Thomas Hanson as Head of High Yield fixed Income from Janus Henderson where he was a high yield credit portfolio Manager
Robeco have hired Jamie Stuttard as Co-Head of Global Fixed Income Macro, and Co-Head of Global Total Return Bond fund from HSBC where he was Head of European and US Credit Strategy
SH Selected Track Record 2019
Portfolio Manager, Fixed Income Sovereign Wealth Fund Global Macro Portfolio Manager European Asset Manager Head of Fixed Income UK Asset Manager Emerging Market Debt Team Build UK Asset Manager Head of Fixed Income Quantitative Research Sovereign Wealth Fund Systematic Fixed Income Portfolio Manager US Asset Manager Fixed Income Trader Sovereign Wealth Fund Senior Portfolio Manager – Fixed Income Middle Eastern Pension Fund G10 Global Bond Portfolio Manager Sovereign Wealth Fund Rates Strategist UK Pension Fund Senior Fund Manager, Multi-Asset UK Asset Manager
This is a private and confidential document prepared by Sheffield Haworth
2019 Asset Management Overview, Europe
MULTI-ASSET
Trends
As in Q2 of 2018, the biggest story in multi-asset in Q1 of 2019 was the continuing troubles at Aberdeen Standard’s GARS, with AUM dropping to a low of €13.2bn in June 2019, from a €60bn high in 2015; a 33 month straight run on the fund.
Challenges & Opportunities
The other big multi-asset absolute return funds too have struggled, with Morningstar reporting that total AUM in these types of funds fell €24bn over the past 12 months.
This trend however has not been universal, as Amundi and BlackRock saw their platforms grow 57% and 48% respectively over the same period. In a similar trend to the rest of the market, these more mid- sized funds have profited at the expense of the super funds. This provides an opportunity for the smaller firms to capitalise on previously untouchable talent from some of the big firms.
SELECTED PEOPLE MOVES:
Baillie Gifford have hired Gregory Turnball Schwartz to help run its Multi-Asset Income Fund replacing Gerald Smith. He joined from Kames Capital where he was an Investment Grade Fund Manager
BNP Paribas Asset Management have hired Maximilian Moldaschl as Senior Multi Asset Strategist to the Research & Strategy team within its Multi Asset, Quantitative & Solutions (MAQS) investment group. He joins from Citigroup where he was in Global Macro Strategy Asset Allocation
Janus Henderson Investors have appointed Alex Barr as Co-Manager of Multi-Asset Alternative Funds from Aberdeen Standard Investments, where he was global head of Private Markets and Real Estate Investment Oversight
Janus Henderson Investors have appointed Michael Ho as Global Head of Multi-Asset and Alternatives from UBS Global Asset Management where he was Chief Investment Officer of Investment Solutions
JP Morgan Asset Management have appointed Hugh Gimber as Global Markets Strategist as part of their EMEA Market Insights function. He joined from BlackRock where he was Vice President, Multi-Asset Strategist
Jupiter Asset Management have hired Mark Richards as a Multi-Asset Strategist from JP Morgan Asset Management where he held the same title
This is a private and confidential document prepared by Sheffield Haworth
2019 Asset Management Overview, Europe
ALTERNATIVES
With the low level of real yields in today’s public markets, private market investments are becoming popular amongst investors. Sovereign Wealth Funds and Pension Funds particularly are increasingly allocating their marginal dollar to private assets, as they are willing to tolerate less liquidity in return for improved returns.
Trends:
Direct Lending: continues to be an area of growth, with BlueBay, Ares and Permira all raising new funds in the past 12 months. New funds are frequently exceeding their targeted capital raise and are significantly larger than previous incarnations. For example, BlueBay’s raised €6bn for their latest fund, exceeding a target of €5bn and significantly larger than their previous €2.1bn fund. Interestingly, it was recently announced that the BlueBay business will be spun out and become an independent entity, backed by Dyal Partners.
Speciality Finance: is beginning to gather pace in Europe, in a similar vein to direct lending 6-7 years ago. There is yet to be consistency of approach with Hedge Funds looking for higher returns through Mez/Equity investing; Private Equity businesses focusing on senior deals, using leverage for returns; and Asset Managers beginning to enter the space with a focus on senior deals – similar to the space that the banks historically occupied.
Distressed/Special Sits: with the growing sense that we are reaching the end of the cycle, we are seeing attention shift back towards the distressed business with many platforms adding analysts in anticipation of increased market activity/opportunity. Established funds have been raising capital for distressed strategies and new funds are beginning to emerge for example, Caius Capital and Lodbrok Capital – launched in 2016 and now managing around $1bn AUM, while AlbeCore, launched at the end.
SELECTED PEOPLE MOVES:
OZ have appointed Louisa Church as Head of European Business Development. She joins from BlueMountain where she was a Partner and Co-CEO for Europe, responsible for business development. Additionally, CVC have developed their Credit sales team, hiring Mike Anderson from Pemberton last year followed by Martin Munte and Nick Haajman this year, from BlueBay and Alcentra respectively.
Carlyle hired Taj Sidhu last year to lead their Private Credit business who was joined by Nicola Falcinelli (Managing Director) this year, both joining from OZ. There have been several other high-profile departures from firms such as HPS, HIG and Alcentra with some looking to start their own businesses.
SH Selected Track Record 2019:
Head of Distressed Debt Hedge Fund Senior Analyst, Distressed Debt Hedge Fund European Head of Private Debt Alternative Asset Manager European Head of Structured Credit Alternative Asset Manager Credit Analyst – IG/HY Non-Financials Sovereign Wealth Fund
Head of Capital Raising Hedge Fund Credit Product Specialist/Sales Hedge Fund Head of EMEA Consultant Relations Alternative Asset Manager German Institutional Sales Alternative Asset Manager Capital Formation Private Equity Fund
This is a private and confidential document prepared by Sheffield Haworth
2019 Asset Management Overview, Europe
The information contained in this document has been compiled by Sheffield Haworth from sources believed to be reliable and is presented in good faith, but no representation or warranty, express or implied, is made as to its accuracy, completeness or correctness. This document does not constitute or form part of, and should not be construed as, advice. Sheffield Haworth accepts no liability whatsoever from any consequential loss or damage arising from any use of this document or its contents. This document may not be reproduced, redistributed or passed on to any other person or published, in whole or in part, for any purpose, without the prior written consent of Sheffield Haworth.
This is a private and confidential document prepared by Sheffield Haworth