Financial advisers will look to fund managers to help them deliver the wealth management services clients increasingly expect, according to the US-based head of one of the world’s largest global asset managers.

“Financial advisers have been pushed to be more wealth managers as they move towards charging fees for services. Clients are saying, ‘I am paying you these fees, what else [aside from access to investment management] am I getting?’,” said Jenny Johnson, president and chief executive of Franklin Templeton Investments, from California in an interview on Wednesday morning with Conexus Financial CEO Colin Tate as part of Fiduciary Investors Symposium.

Johnson, who recently led the $US4.5 billion acquisition of Legg Mason Asset Management, known as one of the largest asset management deals in history, said funds managers need to increasingly work with their partners – advisers on the retail side and pension, endowment and superannuation funds on the institutional side – to help them deliver on their promise to end clients.

Clients are saying to advisers ‘I want to see the financial plan, I want to see tax efficiency, I want you to help me to educate my children’. Increasingly as they are being asked to be more wealth managers, advisers are turning to their partners, the asset managers, and saying ‘can you help me deliver some of these things’,” Johnson said.

On the institutional side, asset managers will increasingly be expected to share their knowledge and thought leadership with their investing partners, she said.

“It’s not enough to give an investment mandate any more, [institutional clients] also want to be given some thought leadership… they want more access to fundamental research,” she said.

Reflecting on the deal that places Franklin Templeton among the largest asset managers in the world by size with $1.5 trillion, Johnson recalled to the timing of the closing in light of the COVID-19 pandemic.

“There’s nothing like announcing the largest acquisition in asset management and then suddenly shifting to a virtual environment to do the close. That’s been interesting,” she said.

Smith is head of content and managing editor of Professional Planner and Investment Magazine.
One comment on “Advisers to lean more on asset managers: Franklin Templeton CEO”
  1. Avatar Jeremy Wright

    Jenny Johnson makes a valid point, which may be contrary to many viewpoints in Australia, in that, you cannot be all things to all clients, provide extensive and professional services and expect your clients to pay top dollar for it, in a world where cost cutting, through necessity, has become the norm.

    Conflicted and outrage, will be heard from Australia, that a 1.5 Trillion dollar Fund Manager would utter such blasphemy, yet she is 100 percent right.
    Actual dollar incentives can be seen as a conflict, though providing the necessary tools to make the provision of advice, easier and more cost effective, makes total sense.

    Fund Managers understand that without advisers, the Financial services Industry cannot grow and people who wish to get advice, do not trust robo advice, unless there is a human involvement.

    Australians are being costed out of advice due to the compliance burden and with only 20 percent able to afford it, there is something very wrong with the current Australian system.

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