F&C says boardroom turmoil cost it institutional mandates

UK asset management firm F&C, whose REO engagement service now covers £83bn (€96.6bn) in assets, has admitted that the high-profile boardroom battle earlier this year which resulted in the removal of its chairman cost it institutional mandates.
The spat saw activist investor Edward Bramson oust incumbent chairman Nick MacAndrew at a shareholder meeting by a 70% vote in February.
Speaking to analysts on the firm’s 2010 results, F&C Chief Executive Alain Grisay said: “We’ve not been blacklisted by consultants on the back of the events of the past few months.
“But we have missed a couple of institutional mandates where we were told in no uncertain terms that the client had taken the view that there was too much uncertainty.
“The reality is we did miss some business but because we’ve not been blacklisted and because everything is now working again in a proper fashion I’m not concerned about any lasting effects.”
Grisay added that the new Stewardship Code presentsopportunities for it as a market leader in engagement. He also cited the recent agreement with State Street where it will provide an environmental, social and governance (ESG) reporting service to their institutional clients.
A spokeswoman told Responsible Investor that Bramson has met with Karina Litvack, Head of Governance and Responsible Investment, to assure her of his commitment to the responsible investment side of the business, which is profitable.
Grisay said the boardroom battle is now “history” – although Bramson did not attend the presentation due to “prior commitments”.
United Nations Principles for Responsible Investment signatory F&C also announced a strategic review of its business and an outsourcing deal that would cut back office headcount by 70% and save £12m a year.
Total assets under management have risen to £105.8bn as at the end of 2010, while its operating loss narrowed to £3.1m from £5.9m.