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(September-2003) Take us to your leader
There was a lack of leadership within the global funds management industry, delegates at the FEAL national conference in Melbourne were told last month.
Both JANA head of research John Coombe and Victorian Funds Management Corporation head of investments Jeff Rogers agreed they hadn’t seen much evidence of leadership in funds management.
“From time to time there is leadership but that is temporary,” said Rogers. “It is more about survival rather than leadership.”
Coombe noted that leadership within a fund manager was a key criterion when evaluating a fund. “It is the leader who sets the culture of the organisation,” he said. “If the leader is passionate, then that passion filters across the organisation, so it is a big issue.”
Rogers added that understanding the rationale of an investment business was crucial. “Investment models are very volatile and that makes leadership different,” he said. “It is an industry full of [investment] processes and that tends to get lost in the volatility of the markets.”
He said there were valid points to be made about leadership in superior organisations. “We like to see managers who can build a case around their investment activity to establish well-founded expectations,” he said. “Delivery of an expectation is to do what the leader said they would do.”
Coombe added that the reward system for fund mangers tended to be aimed at the individual and not the organisation. “The person bringing in the money is not always the best person to lead the organisation,” he said.
Rogers noted that when picking a fund, those leaders who could best explain how the mandate would be managed would become the winners.
Both speakers where asked to pick overseas fund managers who were seen as leaders.
Coombe picked Capital International which, he said, was a company that others copied, but failed to emulate.
Rogers found Dimensional an “interesting organisation” and Bernstein value as “a good model of how to manage in the US and then transport that model around the world”.
AUTHOR
Zilla Efrat
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