CashNews.co
When a student podcast asked incoming Schroders chief executive Richard Oldfield about the most important lessons from his career, his answer was unequivocal.
“Never, ever put off a difficult decision,” he told the interviewer from the London School of Economics in February.
A painful trading update on Tuesday that sent the FTSE 100 asset manager’s shares to a decade low showed that there may be many such decisions ahead of him.
Oldfield, who takes over from Peter Harrison on Friday after just over a year as chief financial officer, broke with recent Schroders practice and gave shareholders a more detailed breakdown of the group’s quarterly performance than they are accustomed to receiving.
The move was welcomed by analysts but also revealed that the group — which was founded in 1804 and remains one of the great dynasties of UK finance — faces at least £10bn of outflows before the end of the year.
Harrison had sought to combat the decline of Schroders’ traditional mutual funds business by staking its future on three higher growth areas: private markets, wealth management and the “solutions” business of providing services to pension funds.
Oldfield, who joined Schroders in October 2023 after three decades at PwC, must now decide whether to double down or deviate from that strategy. He must also keep on side both wings of the founding Schroder family, which together remain its largest shareholders.
His background as an accountant — and Schroders’ spiralling cost base — has led to speculation that cutting costs will be his priority. But while Oldfield on Tuesday made a commitment to “cost discipline”, he ruled out “shrinking to greatness by taking costs out because I actually really believe in the potential of this business”.
Investors generally support Harrison’s strategy but some said it had been let down by its execution. Oldfield vowed to improve the company’s “focus and execution” and prioritise the highest-growth areas.
He will need to assess where Schroders can deploy its capital most effectively. He inherits a sprawling business that employs more than 6,000 people in 38 offices around the globe but has never cracked the US, the world’s largest market.
Among the decisions he will face are whether all of the company’s outposts, from Gibraltar to Nairobi, are needed and whether the firm’s private markets division would be more effective if it focused on fewer asset classes. Oldfield said wealth management “represents one of our best opportunities as a group to deploy capital”. But he signalled that he may look to trim the number of funds in Schroders’ traditional business.
“We have an awful lot of products that we deliver to an awful lot of clients in a lot of markets,” he said. “I want to make sure that we can focus on those parts of our business where we can really see growth.”
Oldfield’s decades-long audit career followed by a brief stint as CFO has raised questions about his ability to turn around an investment house.
“What does he really know about asset management or running a large FTSE 100 company?” said one former colleague.
His recent arrival means he brings fresh eyes to Harrison’s strategic decisions but he must also convince sceptics that he knows the business well enough after only 13 months in asset management.
Oldfield, who has described his early years in Barnsley, South Yorkshire, as “humble”, will also inherit Harrison’s pay packet, which earned him more than £50mn during his eight and a half years as CEO.
Interviews with more than a dozen of Oldfield’s current and former colleagues and clients paint a much broader CV than that of an average PwC partner.
“He’s loud and always up for change and innovation,” said one former partner. “He’s got a very agile, innovative mind,” the person added, pointing to the variety of roles Oldfield held at PwC. There, his clients ranged from banks to drinks conglomerate Diageo, and his responsibilities included leading the firm’s UK banking and capital markets audit practice and its client relationships globally.
After stints in Australia and Africa, Oldfield’s reputation was cemented when he played a pivotal role in PwC winning the HSBC audit — the largest and arguably most difficult on the FTSE — and personally signed off on the accounts for five years.
He did an “outstanding job” auditing HSBC and showed that he really understood the business, said Sir Jonathan Symonds, then the head of the bank’s audit committee and now chair of pharmaceutical company GSK.
Oldfield was appointed to PwC’s UK executive team aged just 40 but the ambitious Yorkshireman missed out on the top job in 2016.
Before joining Schroders, Oldfield spent seven years as right-hand man to PwC’s then global chair Bob Moritz, overseeing the $50bn-revenue business’s client relationships and market strategy. But he left when he thought he would be passed over again if he tried to succeed his boss, according to insiders.
In his global role, he was involved in PwC’s efforts to limit the damage from scandals in the firm’s Chinese auditing unit after the collapse of property group Evergrande and in its Australian tax practice, where government tax information was leaked to partners serving corporate clients.
Symonds played down concerns about Oldfield’s lack of asset management experience. “Schroders is essentially a client-facing services business and he led the client-facing activities of PwC and he was one of its lead partners in financial services,” he said, adding: “He can deliver tough messages and you don’t get cross with him.”
Former colleagues paint Oldfield as bold and decisive. “He was willing to stick his head above the parapet [and] take decisions, or make other people take decisions,” said another former colleague. Oldfield on Tuesday pledged to deliver “accountability” at Schroders by streamlining the executive management team.
Most of the current and former colleagues who spoke to the FT said they liked working with Oldfield, praising his disarming humour, his energy and his ability to build effective teams. But his style occasionally caused friction, some said. “He could rub people up the wrong way,” according to one former colleague.
At Schroders, Oldfield is already living up to his reputation for ploughing his own furrow: his more relaxed approach on not always wearing a tie has raised the eyebrows of some more conservative colleagues, according to multiple insiders. He has also declined the full-time chauffeur-driven car that comes with the top job, preferring to commute by train instead.
In a podcast appearance in February, Oldfield said: “Schroders has been around for 220 years and . . . my job is to make sure it’s positioned to be around for another 220 years.”
The incoming boss insisted on Tuesday that it was early days and he did not yet have “all the answers”. But if the company’s bombed-out share price attracts takeover interest, he may need to find them soon.