Baillie Gifford likes talent coming up the ranks
The Edinburgh-based fund boutique, and Scotland's largest fund manager in terms of assets under management, has an enviable record when it come to grooming and retaining its graduates. Every one of the firm's 16 fund manager partners joined after leaving university.
Richard Barry, HR manager at Baillie Gifford, says lateral hires at the firm are correspondingly rare. "We do make lateral hires to the investment management team occasionally - we made one hire last year and have built our fixed income business through lateral hires," he says. "But, in equities we hired three experienced people back in 2000, and have hired none since."
The emphasis on home-grown talent stands in contrast to rival Scottish fund managers, such as Martin Currie, which has built its business with a rash of outside hires. "We stopped our graduate recruitment scheme in 1999," says Ross Leckie, Martin Currie's head of communications. "Our view on graduates is that we train them at vast expense and then they all leave to go to London," he says.
Baillie Gifford maintains its ability to retain its graduate talent comes largely down to the business model. Martin Currie operates a so-called, 'multi-boutique' strategy, in which independent and high-profile star fund managers manage distinct areas of the businesses on the back of a central operational platform. By comparison, Baillie Gifford emphasises teamwork, downplays individual stars, and has a central fund marketing effort.
"This is not a star fund manager system," says Barry. "Our investors and clients want to know that if a key person moves on, the performance of their fund will not fall dramatically as a result."
Graduate recruits at the firm say the long-term commitment to nurturing talent has cultural advantages. "There's more flexibility," says Matt Brett, a trainee who joined from Cambridge University three years ago. "The relatively low number of lateral hires means people here are freer to move between different areas of the business, and are less concerned about losing specific knowledge that they have about a particular area."
Baillie Gifford's model also has implications for pay. Barry says senior fund managers at the firm are paid less erratically, though some in the market would simply say 'paid less', than their counterparts at boutiques that emphasise star performers. "We offer a smoother path of career progression and salary growth," he says. "Our bonuses are based on a variety of different factors, which include teamwork and individual performance."
