Rupert Clarke, Chief Executive Officer of Hermes Fund Managers
The architect of Hermes transformation.
Rupert Clarke, CEO of the British fund manager Hermes, which is owned by the BT pension scheme and had assets under management of 24.9 billion pounds at the end of 2009, readily admits: "It is rare to find someone whose professional career has mainly been in real estate and finance at the head of a fund management company." This professional, aged 52, began his career at Chase Manhattan in a senior position in real estate management, before holding other positions of responsibility in the real estate sector. He then joined Hermes in 2004 and spent three years in charge of the real estate asset management division, before being promoted to Group CEO in 2007: "My previous experience in business development and change management facilitated the implementation of the strategic overhaul at Hermes. We had to transform a company whose strategy consisted mainly in satisfying the needs of the BT pension scheme into a platform capable of operating like a third party asset management company." Over the last two and a half years therefore the company has implemented wide-ranging changes, switching from passive asset management to an active management approach orchestrated by a series of boutiques. "In our opinion, traditional long-only opaque management products no longer suit the needs of sophisticated institutional investors", explains the CEO.
Today, almost 50 % of the assets of the British telecom operator’s pension fund continue to be managed by Hermes, while the rest has been outsourced. The transformation required a massive recruitment drive, resulting in 220 new professionals being hired - 150 have left the company in the meantime -, taking Hermes’ total number of employees to 420. At the same time the CEO has learnt the lessons of the crisis and is banking on a responsible asset management policy: the company has set up Hermes Equity Ownership Services, a division which provides advisory services intended to ensure that its clients are well-informed investors. "For a large pension fund with long-term investment needs, it is normal to support a fund manager adopting a responsible approach via a wide range of assets and not only equities", concludes Rupert Clarke.