Wholesale/ HNW/ Private Clients
Throughout Q2 we have seen increased demand for HNW Sales / Relationship Managers and Private Client Marketing Specialists across our investment management clients, with a continued trend towards servicing Wholesale and HNW customers.
Interestingly, there has been a particular drive to better serve the female investment market, and how women seek to manage their wealth. As a result we have seen some of our clients specifically targeting groups of high net wealth and ultra high net wealth women. We have also seen boutiques such as Addidi Wealth provide the opportunity for women to co-invest as business angel investors, and philanthropists.
The move towards ESG has meant that we have seen an increased number of ESG Product Marketing and ESG Specialist Investment Writing roles. Our clients have been looking for individuals with a keen interest in broader economics and responsible investing.
BRUIN recently attended a talk on Responsible Investing by Lucy Dunnett, Specialist Investor of the Year 2018 at the Women in Finance Awards, who is trying to influence and change the finance industry for the better, alongside many others. She highlighted that ESG started in the Nordics, and is at the Northern European level currently, making its
way into the UK. Whilst it is still not mainstream within the UK, it has become clear that ESG investing can produce greater returns, can reduce reputational risk, and attract a growing talent pool of ESG conscious candidates. In some instances this has even become the firm’s USP, such as in the case of Handlesbanken, recently ranked as one of the top performing Swedish banks.
A notable trend has been the number of mergers and acquisitions that have taken place this quarter including the strategic partnership between Smith & Williamson and BennBridge to form BambuBlack Asset Management which will become the investment manager for several of S&W’s funds. This was followed by Sanlam UK’s acquisition of Thesis Asset Management, which will bring its UK private client discretionary assets under management to £4.2bn. Another would include Canaccord Genuity Wealth Management recently announcing it had completed its £28m acquisition of Thomas Miller Wealth Management.
Following the raft of mergers and acquisitions and joint initiatives in asset management, further tie-ups are expected across the sector in the coming months amid warnings there may be less room for smaller firms in an amalgamating marketplace. Many have placed the rising merger activity down to the fact that in an age of transformation, buying rather than constructing can unlock the value creation that is needed at a faster pace.
Ultimately, with the rising M&A activity being expected to continue, we foresee Sales and Marketing functions becoming more specialised, with the respective teams reducing in size. Naturally, Sales and Marketing professionals will be focusing on broader and more varied activities to make up for fewer hands in their corresponding teams. Moreover, Marketing Communication roles will become essential in bridging any gaps of business partnerships and change to internal and external stakeholders.
Investment management is in a period of rapid change, driven by shifting investor preferences, compressed margins, regulatory changes and developments, as well as advancing technologies. In the wake of Brexit and the realignment of business strategies to cater to an ever-evolving business environment, asset managers have been increasing their focus on internal and external communications roles to drive and communicate these changes to employees and external audiences alike.
Crisis management and reducing team sizes to make teams ‘leaner’ has driven the need for strong messaging that can communicate a stable and clear direction moving forward, both internally and externally. The expansion into different client remits, particularly with an emphasis on expansion in Europe, has propelled the demand for strong marketing communications teams that can cater their product messaging and appeal to different client segments. We have a seen an increase in demand for Senior Marketing Manager roles catering to European and broader geographies.
There has also been a surprising resurgence of UK regional sales roles within Investment Management. This is mirrored by an increase in the number of Sales Support and Investor Relations opportunities that have been released to bulk up and assist the UK sales efforts. In the near future, we do expect both senior and junior sales roles to be more aligned to building and creating client relationships in Europe, with an increasing requirement of such individuals speaking European languages.
Given the large volume of sales roles in the second quarter of the year, it is unsurprising that there has been a demand for RFP and marketing services candidates at the junior, mid and senior levels from both a contract and permanent perspective. The strong need for RFP mandates to align to successful bids presented by the sales team has enhanced the need for RFP candidates that have a strong technical investment background.
Heading into Q3 we expect to see consistent high demand for communications orientated roles as the revised Brexit date approaches. Organisations will need to effectively inform their internal staff and external stakeholders of their Brexit strategy to ensure they limit outflows and maintain confidence in their brands.
Similarly sales roles will likely remain focused on UK retail and wholesale distribution until we have further clarity on the outcome of 31st October deadline for leaving the European Union. Once investment firms have a better idea on passporting and other regulatory and legal aspects, we could see a resurgence of European roles, either UK based or in the continent. Either way, we expect Q3 to lead into a busy Q4 for companies both based in the UK and those who are looking to expand their EMEA reach.
Fintech has been gaining significant traction in recent years. Initially seen as a direct competitor to more traditional buy and sell-side firms, we have seen a shift from being adversarial to moving towards more firms adopting a collaborative approach between the “old” and the “new”. An example of this is Schroder’s “Colbalt Programme”, helping financial services start-ups work with asset managers to help their development and offer solutions that are relevant to the investment management landscape; or Fidelity investigating the use of blockchain technology. This is likely to increase over time as businesses try and find a competitive edge over peers in the industry and engage with a younger generation and generate further revenue.
Who will be the successful disruptors?
Institutional /Retail banks
We shouldn’t underestimate the power of the big banks, particularly as the more inclusive future of banking emerges and their readiness for digital adoption. They are focusing far more on the customer and less on the sale of the product. They are merging with FinTech providers to try and ensure a better quality of life for their consumers and now have more of a social purpose than they have had in the past.
The UK banks want to embrace wholesale change and the regulators have helped to open it up. The UK is leading the way in terms of Fintech Innovation and this is referred to as the ‘Unbundling of banking’.
Citibank was the first bank to register as a PISP (Payment Initiation Service Provider), and to offer open banking. They are partnering with FinTechs in order to do this and exploring some innovative solutions such as WhatsApp for payment transfer mechanisms, which could have a major impact.
There are also Challenger Banks such as Starling, who are coming into the frame and making products available but not offering the products themselves. They are not trying to be everything to everyone, but instead to offer an efficient and easy online process for their customers; onboarding and transferring money is made simpler. It is estimated that at least 40% of banking revenue has already gone to the challengers (2/3rds of which are under 30).
The general trend is for customers to have their current accounts with one of the big banks, and then use the likes of Monzo and Starling Bank to play around with their money, and then they move onto wealth management.
There are new wealth platforms coming up, competing with the likes of Charles Stanley and Hargreaves Lansdown. The biggest challenge for wealth managers is attracting Millennials, as they become wealthier and want everything online, and information to be at their fingertips. Successful wealth managers will maintain an element of face to face and a blend of technology/AI: ‘Eye ball over balance sheet’. Those that really get to know the consumer without completely relying on tech, and who continue to connect with the ‘human story’.
MOVERS & SHAKERS
To compliment what has already proved to be an interesting second quarter, we have witnessed various movements in the Senior Distribution Sales space particularly Head of Global Distribution roles. One firm we have seen movement from in Q2 is Janus Henderson. The fund house worth $357bn recently hired Suzanne Cain as Global Head of Distribution. Cain departed from Blackrock where she was US and Global Head of Institutional Clients for the ETF arm of Blackrock, iShares. Phil Wagstaff who also worked at Janus Henderson as Global Head of Distribution has now moved to Jupiter to work in a similar role.
There have also been internal movements at T.Rowe Price, namely Robert Higginbotham who was previously the Head of Global Investment Management, has now been promoted to be the Head of Global Distribution. The new face for US Institutional Distribution is now Chris Newman. Mr Newman replaces Keith Lewis who had worked with the firm for 31 years and retired at the end of 2018. To broaden T.Rowe’s engagement with fund selectors, Marcus Gibbons has been appointed as the new UK Head of Discretionary Sales.
Jon Morgan is now Head of Consultant Relations for North America at Insight investments, one of the asset management subsidiaries of BNY Mellon, which currently has $1.7 trillion in assets under management. Mr Morgan joins from Blackrock, where he was formerly Director, Global Consultant Relations. The other move is by Guido Maistri who was previously Head of Distributions at Blackrock and is now moving on to be a Senior Relationship Manager at Generali Investments.
On the marketing side, Cohen and Steers, the Global Investment Manager, brought in a new role which is at a senior VP position as the Head of Global Marketing for which they hired Paul Zettl. Mr Zettl joins Cohen and Steers after 5 years at T. Rowe Price.
Polar Capital has also made major changes to their senior management due to their group’s succession planning, with Vik Heera being appointed as Head of Marketing. He joins from leading the UK marketing effort at Artemis. Schroders have also made some internal changes as they announced James Cardew as their new Chief Marketing Officer for the Schroders Personal Wealth business.
For more information about the market or current opportunities please contact one of our Consultants.