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Schroders chief executive Richard Oldfield has warned against calling the “death” of London’s equity market, arguing that listed companies were vital for transparency and holding management to account.
“We have to be careful to call the death of public markets . . . they are super important to our futures, so they are definitely not dead,” Oldfield said, speaking at the FT’s Future of Asset Management conference on Tuesday.
He added that active fund managers such as Schroders, one of the largest asset managers in Europe, also played a key role. “If our industry did not exist, the broader ecosystem doesn’t work because we are key to price formation and IPOs,” he said.
Fundraising through initial public offerings in London slumped to a 30-year low in the first half of the year, with just five listings in the UK raising £160mn.
The dearth of companies looking to publicly list their shares in London has left some private market companies struggling to offload their holdings in the challenged IPO market.
Schroders, which manages £817bn of assets, has long offered equity funds. But in recent years, it has expanded into private markets through a series of acquisitions, including private equity firm Adveq, and a joint venture with retirement company Phoenix to form Future Capital Growth, aimed at opening private markets to more pension savers.
A report by PwC this week said private markets were poised to account for more than half of global revenues in the global asset management industry by 2030.
Despite Schroders’ push into private markets, Oldfield said he was “optimistic” about the outlook for public equity managers.
“We are pretty fundamental to making sure there’s oil in the system that can grease the way the whole economy works,” he said, adding that public markets “provide transparency on companies” and “allow active asset managers like Schroders to engage with management around their strategies and hold them to account.”
Oldfield has focused on cutting costs at Schroders and replaced its 23-person group management committee with a group executive committee of nine members since he took the top job at the 221-year-old company in November last year.
Oldfield also said Schroders had been investing heavily in tokenisation and blockchain technology, which presented a “massive opportunity” for the entire asset management industry and was a “huge leveller” because “you can do active at a lower price point”.
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