‘The world is learning to work flexibly,’ says BMO fund CEO 

0

Fund management executives around the world are grappling with working at a distance from their colleagues — but Kristi Mitchem has had a head start.

Since taking the reins at BMO Global Asset Management, the C$355bn ($251bn) asset management arm of Canada’s BMO, a year ago, Ms Mitchem has been based in San Francisco, a city nearly 3,000 miles away from her group’s Toronto headquarters.

In normal times she spends much of her week on conference calls and flying between her company’s global offices.

But large-scale homeworking arrangements across most of the corporate world due to the coronavirus pandemic mean she is no longer in the minority. 

“The practice I’ve had over the past year is paying off,” she says over the phone from her native Florida where she is in lockdown.

Despite challenging circumstances, the experience has reinforced Ms Mitchem’s belief in the benefits of flexible working, which she argues is key to encouraging more women to enter asset management.

“When we ask ‘where are you based?’ it doesn’t really have the same import as it had in the past,” she says. “If there is a bright side to all of this, it’s the notion of learning how to work more flexibly.”

As BMO GAM’s first female chief executive, Ms Mitchem is seeking to lead by example. Her decision to stay in San Francisco after her appointment was taken to minimise disruption for her school-age children.

Promoting diversity is a core mission for the mother of three daughters, who quit her initial career in investment banking after the 4am starts took their toll on family life.

“Like many women of my generation, I’m not sure that I gave a lot of thought specifically to my gender,” she reflects when we first meet during a visit to London in January. “It’s probably only retrospectively that I’ve recognised some of the barriers I faced.”

BMO Global Asset Management

Established Dates back to 1868 when F&C launched the world’s first pooled investment vehicle

Assets under management C$355bn

Employees 1,193

Headquarters Toronto

Ownership Bank of Montreal

Born in Florida but raised in California, Ms Mitchem exudes west coast positivity, with her sparkling smile and bright, energetic demeanour. But she is also cautious and occasionally pauses before falling back on stilted corporate lines, which are echoed by her PR minder in the background.

Her reticence points to the fine line she treads as head of the fund unit of Canada’s oldest bank. Bank-owned asset managers tend to be more conservative and top-down than their independent rivals.

BMO GAM is steeped in tradition. The location of our January meeting is a grand wood-panelled room in the former offices of Foreign & Colonial in the City of London. F&C, which was incorporated into BMO GAM in 2014, is famous for launching the world’s first collective investment vehicle in 1868.

While asset and wealth management are a growth engine for the group, structural headwinds battering Canada’s banking sector have pushed BMO to impose job cuts. Ms Mitchem’s workforce is not immune.

She plays down the impact of job losses, saying the focus is on improving efficiency. “It’s about doing things better, not just reducing headcount,” she says. “That actually works quite well given the environment we’re all living in in asset management today.”

Ms Mitchem, who before becoming a CEO worked at Barclays Global Investors — which went on to be acquired by BlackRock, has faced her share of tough conditions since taking up a leadership role in fund management. Two months into her previous job as chief executive of Wells Fargo Asset Management, the bank was hit by its account fraud scandal, which resulted in it paying out $3bn to US regulators.

While Wells Fargo’s asset management arm was not implicated in the scandal, the incident stymied new business opportunities for the unit, admits Ms Mitchem. Under her leadership, assets stagnated, hovering at about $483bn.

“It [the scandal] presented an opportunity for growth for me as a leader,” she says. Among the lessons she learnt were the importance of communicating proactively, contingency planning and staying positive.

She wants to apply these as she leads her business through the coronavirus crisis and market tumult. At her initiative, the group is sending a daily inspirational quote to all employees: a recent one was Theodore Roosevelt’s “Believe you can and you’re halfway there”.

As competitive pressures among asset managers intensify, Ms Mitchem says BMO GAM has an edge over rivals due to its strength in acting as an adviser to clients in areas such as responsible engagement, fiduciary management and liability-driven investment, rather than just selling a product.

Kristi Mitchem

Born 1970, Florida

Education

1988-92 BA in political science, Davidson College

1992-93 Fulbright fellow

1995-97 MBA, Stanford University

Career

1994-95 investment banking analyst, Credit Suisse First Boston

1997-05 various investment banking roles, Goldman Sachs

2005-10 various roles including head of US transition services, Barclays Global Investors/BlackRock

2010-16 various roles including head of Americas institutional client group, State Street Global Advisors

2016-19 chief executive, Wells Fargo Asset Management

2019-present chief executive, BMO Global Asset Management

However, she admits that more needs to be done to adapt the underlying fund range to meet the increasingly exacting requirements of investors today. One of her first steps as CEO was to establish a global alternatives division.

Ms Mitchem also wants to focus on areas where her unit can add value, and she recently decided to close a subscale European exchange traded fund range. Given the tough climate, asset managers “can no longer afford to be distracted or to try to be all things to all people”.

Although she descends into corporate speak while outlining her vision for BMO GAM — she utters the words “client-centric” and “top-of-the-stack capabilities” almost 10 times — she talks passionately when detailing the steps to build a more diverse workforce.

Ms Mitchem, who, while working at State Street, spearheaded the launch of the gender diversity ETF that gave rise to the Fearless Girl statue, advocates changing the language used in job descriptions to make them more collaborative to appeal to female candidates.

She also wants more women to speak on behalf of BMO GAM. “Women are vastly under-represented in the press and broadcast media. The number of female experts on TV is about one in five,” she says.

“We want to make sure we’re not just showing the face we have but also the face we want to have, so that when women read articles or watch broadcasts about the financial industry, they actually see women as experts and believe they can own that domain as well as men.”

As she shows me to the door, she opens up with an observation that sheds light on her reticence during our conversation. The problem, she says, with enlisting female spokespeople is that women “tend to be more cautious” than men.

Source