The Feeney files: the best bits of our exclusive Quilter interview

We recently welcomed Quilter CEO into our studios for an exclusive interview. Check out all the pics here.

Paul Feeney has had an extremely busy year. 

With a public listing, platform woes, a comprehensive re-brand, and now staff turnover all hitting the headlines, it would be fair to say 2018 has been an intense one for the Quilter chief executive.

Despite all that, Feeney gave up his time to give us an exclusive interview, in which he discussed all that and more with us. 

You can view all the pictures, and the best quotes from the full interview, by clicking on. 

 

Paul Feeney has had an extremely busy year. 

With a public listing, platform woes, a comprehensive re-brand, and now staff turnover all hitting the headlines, it would be fair to say 2018 has been an intense one for the Quilter chief executive.

Despite all that, Feeney gave up his time to give us an exclusive interview, in which he discussed all that and more with us. 

You can view all the pictures, and the best quotes from the full interview, by clicking on. 

 

On the pressures advisers face:

'I think, simply that it’s getting colder out there. It’s getting more difficult out there. Capital requirements are getting heavier.'

On robo-advice:

'Don’t get me started on robo. I am underwhelmed by robo-advice. I think there is a place for it. I think far better, would be to look at some of that technology and provide it to financial advisers. Fundamentally, setting up a website, building some algorithms to five ETF portfolios and then just doing a bunch of advertising on a London tube, I think, has proven already to be ineffective and that’s not going to make any dent on the savings [gap].'

On whether the DB transfer sales party is over:

'First of all, it’s not a party it’s a responsibility and therefore, as a responsibility we take it very seriously.  Now, structurally if you go back to the structural thesis I mentioned before, insurance companies in this market used to own the retail investment market in this country, not the asset managers, not the wealth managers, not the banks, the insurance companies. They built opaque capital heavy structured products with profits, endowments, structured products. That is all coming out, defined benefit.  It’s all coming out and where is it going?  It’s going into flexible, open, transparent, low cost retirement wrappers and today, those are all held on platforms.'

On doing a pension transfer:

'Yes, I did and I’ve had DC pensions and DB pensions.  That’s why I have a financial planner, that’s why I have a wealth manager, Quilter Cheviot, I need it.  I really do need it.'

On DB liabilities:

'We have great pressure on corporate balance sheets because DB schemes effectively sit on the corporate balance sheet. So, a lot of these corporates are effectively, if you looked at their assets and liabilities together, already bankrupt. Now not technically because these are long-term liabilities. So, there’s a great pressure to get those liabilities off the balance sheet.'

On spending £330 million on a platform that never materialised:

'I think first of all, of course, it was a painful lesson for our shareholders, for our staff, executive management board, everybody. But at the same time it was nothing to do with IT, it was to do with actually coding our existing systems, documenting the code in our existing systems which are 20-odd years old. 

'When we did the deal with FNZ, we were able to sit down and I was able to sit down with Adrian Durham and say: “You’ll have all this, not within 18 months, but within 18 hours".'

On the new platform:

'We’re not going to go for big bang. We’re going to go for a risk controlled, managed, phased implementation. So, the most important thing for me is quality.'

On the profitability of the platform world:

'The platform sector as a whole, I would gauge is break even at best. We are highly profitable because it's a scale game. It's a scale game, guys. So, have a platform knocking on for something like £55 billion under administration. We're very profitable.'

On the Schroders/Lloyds financial planning tie-up:

'I started by saying we need more financial advisers in this country.  We have a huge financial advice gap. I think good competition raises the bar for everybody.  If I've got strong competition, the market’s going to make my business better.'

On St James's Place:

'Clearly, SJP is a quality company, we have great respect for SJP and what the guys there have created, but we’re not trying to be SJP, we have a very different business model. Our business model is built on choice. If anything, I’d call it multi-channel and the principle behind it is that the client, the adviser, they should choose how they wish to do business with us, not us determining how they have to do business with us.'

On being a unique business:

'There is no model out there [that is the same as ours]. In fact, my board even right from the start said: "So Paul, tell us which company you’re trying to be?"  I’m not trying to be any company.'

 

On his poem*, 'here's to the change-makers':

'I don’t think any of our poet laureates have got anything to worry about with my poetry skills, but the poem I did was really to try to help our people understand what we are trying to be and why we’re trying to do what we’re trying to do.'

*You can read the poem here.

On keeping shareholders happy:

'I would say that I know 75% to 80% of my shareholder base personally and that's because they've been on the journey with us. 55% of our shareholder base certainly, have been on this six-year journey with us, until we quoted because we were part of the Old Mutual Group.'

On joining Old Mutual Wealth as chief executive:

'I went around in my 60 days - it’s the new 100 days - and I came back and the group chief executive of Old Mutual at the time said to me: "Paul, tell me in two minutes what you found that you think you can work with." I said: "I’ll tell you in two words what I’ve found that I can work with in this company: people care. People care and I can work with that.”'

On mental health:

'You know, sometimes [employees] look up at a chief executive [as though they are perfect]. No, I’ve had my own issues, I’ve had my own mental health issues in my life and it’s okay to talk about them and I want Quilter to be a place where it’s okay not to be okay and people can talk about that.'

On investment managers leaving the business:

'11 or 12 investment managers have decided to leave and you know, they've done that two or three times before in the industry. [They're] not a part of our culture and there will be some people who self-select along the way, not to be on the journey. They have, good luck to them.

'How do I feel about it?  Obviously, I don't like people leaving.  I certainly don’t like people leaving and taking our clients, but at the end of the day you can’t personalise it.'

 

On the lessons of the financial crash:

'I think if we’ve learnt anything in the last ten years in financial services, that if you build a company purely for-profit maximisation, you will not build a sustainable company.'

On being in it for the money:

'Well the first thing I'd say is my remuneration’s all public so you can see that hasn't been the case at all and basically, all my benefits are aligned very long-term in this company. So, it's not what I’m here to do.'

On executive pay and responsibility:

'We're all paid well for what we do. We work very hard for what we do, and I think as long as we appreciate that and we can give back, then okay, but I -, so to your question, am I sufficiently well off? Yes, of course I am. I am sufficiently well off by anybody's standards and in terms of what I earn, compared to what normal working people earn in this country, it's an awful lot of money and that gives me a responsibility. It gives me a responsibility to ensure that what I do with my time in my role, makes a difference.'

 

On having a legacy:

'Do I have a step-by-step plan for myself? No, I have a vision of what I would like to have achieved by the time I step down, but there will come a time when I will need to step down. There will come a time when someone else can do this job better than me and that time will come.'

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