Nigel Wilson led Legal and General in a 'considered way'

But as he prepares to retire from L&G, and more broadly from executive life, what do advisers and clients think of the legacy has he left in the industry, and the L&G products that they use?

Wilson has been at the helm of the company, a significant player in the asset management world due to its range of passives as well as the pensions and equity release markets, for just less than 11 years. 

Non-executive directorships could be on his radar – a predictable end to a working career that often veered away from the mainstream.

John Kingman, the chairman of L&G, said at the time of the announcement: “Nigel has successfully navigated significant geopolitical changes as well as challenges in the regulatory and market environments of each of our core businesses and has steered the group into a position of strength from which it can continue developing on behalf of its shareholders, customers and people.

"Under his stewardship, the group has consistently delivered profitable, sustainable and inclusive growth. Nigel has been a tireless champion for investment-led growth and responsible investment."

Performance

But what of the impact on shareholders?  

If measured purely in share price terms, the past five years have been tough for L&G, with the share price declining by just less than 4 per cent (to February 2 2023) compared with a gain of 5 per cent for the FTSE 100 as a whole.

Another comparator may be with a peer, say, Aviva, another insurance and asset management firm, which has suffered a share price decline of 33 per cent in the same time period. 

Insurance company share prices generally struggled in the era of quantitative easing, as the regulatory capital they are obliged to hold in liquid assets such as cash or government bonds had a very low yield, thus reducing the income available to insurance companies from that portion of their assets. 

They have really worked to develop an innovative thematics range, which I think is particularly meeting demand from the retail space.Ben Seager-Scott, Evelyn Partners

Wilson has been chief executive of L&G for just less than 11 years, a stint that is around double the average for a FTSE 100 chief executive. 

Russ Mould, investment director at AJ Bell, says: “The life insurer’s 341 per cent total return since he took over in June 2012 beats the FTSE 100’s 120.2 per cent hands down.” 

One of the areas where L&G has been a true innovator under Wilson, according to Ben Seager-Scott, head of multi-asset funds at Evelyn Partners, has been in passive investment. 

He says: “I wouldn’t say we use them extensively but we do have a number of their funds in our passive mandates. I would definitely say they are innovators in this space. Not only do they have a great suite of cost-effective ‘mainstream’ trackers, they also have an interesting Future World range that we use in a number of our mandates.

"And following the acquisition of Canvas ETF (part of the ETF Securities deal) they have really worked to develop an innovative thematics range, which I think is particularly meeting demand from the retail space.”

I think one of the things that made him stand out is his understanding of the consumer.Russ Taplin, Altus

The most recent data from Morningstar, which covered the month of December, showed LGIM – the asset management division of L&G – had the largest net inflows into its mandates of any firm in the UK market in 2022, with a net increase of £4.1bn, taking the total assets of the asset management unit to £56bn in terms of its retail funds. 

According to the company half year accounts for the first six months of 2022, the asset management unit is actually the largest of the three divisions it operates, with total assets under management of that unit being £1.29tn. Post-tax profit for the period was £1.15bn, a rise of 8 per cent on the previous year. 

But that focus on growing the passive book of business may have had consequences for the active mandates, with at least one fund manager, now at a different firm, citing the feeling that active managers at LGIM are the “poor relation” for his decision to leave and move to another business.

Growth engines 

Russ Taplin, senior consultant at Altus, says: “Nigel Wilson was a well-liked leader. He grew the company in quite a considered way over the years. I think one of the things that made him stand out is his understanding of the consumer and a good view of how to grow the business based on that.

"One of the features of his strategy in recent years has been to try to invest more into the regions, into illiquid assets outside of London. There were a couple of reasons for this, availability of those assets was one, and the risk profile of the assets.

"Investing more into the regions and regional development generally was also something he has spoken passionately about.” 

Taplin adds that one area in which L&G has become a substantial player is equity release.

I think in years to come he will be remembered as a successful chief executive.Russ Taplin, Altus

In terms of the product offering in this area, he says: “They can be quite expensive. It is fair to say I think that they focus on the wealthier end of the equity release market, and they are very good at profiling customers, which fits in with the previously mentioned way in which they grow in a considered way.

"They have also in recent years under Nigel’s leadership been trying to grow in the commercial mortgages lending market and in the less liquid areas of the market.

"I think in years to come he will be remembered as a successful chief executive."

Wilson is not departing immediately; he has agreed to stay with the firm for up to a year as his successor is sought.

In terms of what comes next for him, he declined the opportunity in 2022 to become a minister for trade in the UK government, but he remains a keen athlete and has won numerous trophies in that field.

In his retirement statement he said he is retiring from “executive life”, implying that he will not resurface as a chief executive anywhere else, but that non-executive directorships could be on his radar – a predictable end to a working career that often veered away from the mainstream.

David Thorpe is investment editor of FTAdviser