The new chief executive of St. James’s Place (SJP) must be “brave” to both lower advice and fund fees “which are stuck in the past”.
An SJP partner told Money Marketing that 30 years ago, the firm was a visionary business but now the company has gone “stale”.
They accused the company of not “evolving quickly enough” and said any new leader needs to be very “pro change”.
“If anyone is going to be able to change things, it is the new CEO”. Earlier in the year (2023) SJP announced current chief executive Andrew Croft will be stepping down.
Croft has been at SJP since 1993 and was chief financial officer from 2004 -2017 and then became CEO in January 2018.
The wealth management and investment advice giant has hired Russell Reynolds Associates, a leadership advisory and executive search firm, to help find Croft’s replacement.
According to reports Mark FitzPatrick, former CEO of Prudential, is the leading contender to take the reins.
The SJP partner accused Croft of simply “maintaining the status quo” and that the fee structure needs to become more “flexible”.
“SJP as a network [the partnership] needs flexibility too.”
They also said the SJP exit fee “is the first thing that has to go” as it just makes clients feel “trapped”.
SJP charges an exit fee for any early withdrawal charge of 1% for bonds and pensions.
According to its website, if you encash within the first six years of an investment there will be an early withdrawal charge of 1% of the value of your fund in respect of the investment.
After 10 years, the annual product management charge will be reduced from 1% to 0.85%.
Additionally, SJP should offer more flexibility in its advice fees the partner added. “I would make changes to the advice fees”.
“Advice and funds fees need to be revised,” he continued.
However, the SJP partner also spoke positively about the wealth management and investment advice giant.
He said it “gets more things right than it does wrong”.
It also has invested a large amount of money in artificial intelligence (AI) and has strong advice frameworks.
Recently Joe Wiggins rejoined SJP to become director of investment research and in April it was announced Justin Onuekwusi would become chief investment officer (CIO).
The SJP partner feels these two hires could really help the company and make positive changes as they are “both very good”.
They added the reduction of fees “would be an easy fix with two new investment directors and a new CEO, its all up for grabs”.
SJP is putting the “right people in the right place” to orchestrate change, the partner continued.
SJP was contacted by Money Marketing and declined to comment.
