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New Schroders CEO Peter Harrison Inherits a Thriving Business
Formerly head of investments, Harrison succeeds Michael Dobson, who turned the firm into Britain’s biggest pure-play asset manager.
The wait is over for Peter Harrison. Three years after rejoining Schroders as global head of equities and presumed heir apparent to longtime CEO Michael Dobson, Harrison, 49, was tapped in March to take over as chief of the venerable asset management firm, beginning April 4.
The promotion is the crowning achievement of a career that began in 1988, when London-based Schroders hired Harrison as an equity analyst fresh out of the University of Bath, where he earned a degree in business administration. After stints as a portfolio manager in the 90s at Newton Investment Management and Robert Fleming & Co., he rose to become global head of equities at J.P. Morgan Asset Management, which had acquired Flemings, and then moved to Deutsche Asset Management as global CIO. Harrison left in 2006 to become CEO of investment boutique RWC Partners. Schroders bought a controlling stake in RWC in 2010 and hired Harrison in 2013.
As head of investments for the past two years, Harrison has championed the use of big data to develop investment ideas and hired more tech-savvy staff. He has also prepared Schroders for the introduction of the European Unions revised Markets in Financial Instruments Directive, or MiFID II, which is expected to ban the use of soft-dollar commissions for investment research. He seems quite open to thinking about things in a different way, says Haley Tam, a Citigroup analyst who covers Schroders.
Harrison will have to continue to do so to make his own mark, for he hasnt quite escaped his bosss shadow. Dobson is moving up to the chairmans seat being vacated by Andrew Beeson. The move drew flak from shareholder rights groups because it flouts the U.K.s corporate governance code, which frowns on companies elevating their CEOs to chairman. The worry is that the chair will stifle his CEO successor and fail to provide sufficient oversight.
But in a letter to investors, Schroders explained the move, calling Dobson the outstanding candidate for the post. And in any event, the transition enjoys the backing of the only investors who really count: Bruno Schroder, the great-great grandson of co-founder John Henry Schroder, and his family, who own 45 percent of the company.
The Schroders love Dobson because he restored the firms health and the familys wealth. The group was losing money in 2001 when Schroders brought in Dobson, former CEO of merchant bank Morgan, Grenfell & Co., by buying his small hedge fund firm. Over the next 15 years, he transformed what was almost exclusively an equities outfit into a diversified manager by developing fixed-income and multiasset businesses. The firms assets under management and its share price more than tripled under his leadership. Schroders took in £13 billion ($18.8 billion) in net new assets last year, helping it to surpass Aberdeen Asset Management as the U.K.s largest pure-play investment manager, with AuM of £313.5 billion.
If Harrison comes close to matching that record, he can expect a long run at the top.
Follow Tom Buerkle on Twitter at @tombuerkle.