Schroders Cuts Top Executives In Effort To Revive Growth Linked To New CEO

 Schroders Cuts Top Executives In Effort To Revive Growth Linked To New CEO

Schroders PLC is reducing the number of members on its executive committee from 22 to nine, reflecting new Chief Executive Officer Richard Oldfield’s effort to revive the fortunes of the U.K.’s largest standalone asset manager.

 

As part of the overhaul, Ed Houghton, who most recently served as a director at Legal & General Group PLC, is joining Schroders and its management committee as head of strategy and investor engagement, according to a statement seen by Bloomberg News. Mary-Anne Daly will remain on the panel, overseeing wealth management; private-wealth head George Wunderlin will become head of Schroders Capital; and Karin Szenberg will take over as sole head of the client group.

Oldfield's first move as CEO comes as he faces pressure to make cost cuts at the 220-year-old company, whose stock has fallen more than 50% over the past three years. Oldfield, who will join Schroders as chief financial officer in 2023 after more than two decades at PwC, did not rule out broader job cuts in an interview.

 

Oldfield is set to take the top job on Monday from Peter Harrison, who has been at the helm since 2016. The leadership change comes at a crucial time for the money manager, which has faced significant criticism over a relatively high-cost base and slow organic growth within its private markets business. Schroders manages £777 billion ($1 trillion) in assets.

 

In a sign of growing investor impatience, the company's shares fell nearly 14% on Nov. 5, following a trading update that showed quarterly outflows of £2.3 billion and warned of more than £10 billion in redemptions.

 

The executive committee downsizing move brings Schroders closer in line with its European rivals Amundi SA and DWS Group, which have 13 and 6 members respectively on their executive teams. Members who are no longer part of the panel will remain with the firm.

 

Oldfield said a review is underway across a range of Schroders businesses, including its actively managed public markets funds, a solutions unit that offers investment services to corporate pension plans as well as wealth management and private markets divisions.

 

He said Schroders needed to establish itself as one of the few upmarket grocers in the world that had a global presence and offered a wide range of high-quality products.

 

Private markets

 

Under former CEO Harrison, the money manager made major moves beyond its traditional mutual fund business into the more lucrative private markets sector, including an acquisition of renewable energy specialist Greencoat.

 

However, as high interest rates globally have slowed private asset sales and prevented large investors from reinvesting profits in new funds, fundraising has been less successful than expected.

 

Oldfield has warned that the firm will not reach its target of £92 billion in assets under management by 2025 in its private markets division.

 

The firm's Cazenove unit, which provides services to wealthy individuals, has seen steady investment in recent years. Last month, the business bought boutique firm Whitley Asset Management to further expand its reach to the ultra-wealthy.