Liontrust chief brands rivals ‘disrespectful’ over IA crisis

Liontrust chief brands rivals ‘disrespectful’ over IA crisis

Liontrust’s John Ions has criticised asset managers briefing against the Investment Association for being “disrespectful” to their peers, but agreed the trade body should refocus on consumer engagement issues.

In the first on the record comments from an asset management chief executive since the crisis at the trade body broke earlier this week, Mr Ions said he was “disappointed” fund houses had decided to “air their dirty laundry in public” rather than consulting other firms with their concerns.

Earlier this week it emerged that Schroders and M&G are to let their memberships with the IA expire at the end of this year - though neither has commented publicly.

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This revelation, coupled with the suggestion that other fund houses could follow amid discontent at the trade body’s direction, led to IA chief Daniel Godfrey’s resignation on Tuesday evening (October 6).

Mr Ions, however, said grievances should have been dealt with in private, and in conjunction with other members.

He said: “It was a little disrespectful to other fund managers. These groups all have people on the board [of the IA]. As a board director I would not be saying anything without talking to the rest of the board about it. I think the whole thing is a bit shoddy and not the right way to go. It should have been dealt with behind closed doors.”

Liontrust, unlike the fund houses who were said earlier this week to be considering leaving the IA, was among the 25 firms to sign the IA’s 10-point statement of principles in August.

Mr Ions sees the principles as uncontroversial, but hinted the future direction of the IA could yet have an impact on Liontrust’s role with the trade body.

He said: “We weren’t reviewing our position, but how the association reacts to all of this will definitely have an effect on what we decide to do.”

Yesterday (October 7), investor rights group ShareAction said the apparent push to oust Mr Godfrey, led groups who had not signed the statement of principles, raised questions of whether the industry is putting “its own interests ahead of [...] savers’”.

Liontrust’s Ions, who has been in charge of the firm since 2010, agreed with suggestions that the trade body should now take a different stance, however.

He implied the IA’s focus on cost transparency, spearheaded by Mr Godfrey, had come at the expense of other issues.

“We have spent an awful lot of time coming up with the perfect TER [total expense ratio], and perfect transparency. But the biggest challenge is to promote the industry to the investment public.

“What we need to do is talk about the benefit of savings and investment. There should have been more emphasis on the promotion of [this] especially, to help people who are retiring.”

He also suggested the fallout from this week’s events would hurt perceptions of the fund management industry.