Platinum Asset Management and Magellan Financial Group had bad FY23s and are making changes. But does it really bring fresh hope for shareholders?
The experiment hasn’t worked, egos can be put away and sanity has prevailed.
Hopefully, splitting the CEO/CIO functions can help arrest the slide at both fund managers, as far as shareholders are concerned, who are fed up with the poor performance. Magellan’s fall from grace was rapid, Platinum’s occurred more slowly. Both need turning around. Separating the CEO and CIO roles puts Platinum and Magellan in line with other Australian listed fund managers including Regal Partners and GQG Partners. At both Regal and GQG, the rockstar stockpicker continues to run the investment team as CIO, and is charged with making money for underlying clients/unitholders, while a separate CEO is charged with looking after the business and shareholders. It is hard to serve both unitholders and shareholders at the same time.
The other big listed fund manager is Perpetual, however, its funds management arm is one of three different business units, and it has seasoned funds management executive Rob Adams in charge as CEO and separate investment teams.Of course there is some logic in having one executive fill both CEO and CIO roles. At the end of the day, the fortunes of the two parts and the two sets of stakeholders are intertwined.
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