Franklin Templeton revamps distribution

By Elizabeth Fry

The industry continues to see a shake-up in distribution teams with the ever-rising pressure heaped on asset managers by their increasingly sophisticated clients.

Franklin Templeton's head of Australia and New Zealand Felicity Walsh is beefing up her distribution team with people who bring a sharper intellect to the job.

Walsh says there is a strong focus on hiring intellectually rigorous staff with a strong interest in markets and investments, ideally having experience beyond distribution.

This is somewhat different to a traditional sales team model.

Many are CFA charter holders (chartered financial analysts) with demonstrable expertise in markets and investment.

Two of her salespeople have completed the CFA designation in the last two years.

Incidentally, these famously tough qualifications provide expertise in specialised areas, from sustainable finance to financial planning and alternative investments such as private equity and hedge funds.

Walsh says the sophistication of clients calls for dedicated, highly skilled sales teams with technical know-how.

"It's much more about understanding what clients want. What are their problems? And what are we trying to solve for them rather than just taking a solution to them -- whether within an asset class or across their portfolio," she says.

"Clients want to have a sophisticated conversation and be able to trust who they're talking to. They don't want to be sold the latest product," says Walsh.

"We look for talent that can have a broad and deep conversation with our clients, across asset classes and markets.

"Given the sophistication of our clients, we achieve results by lifting the quality of the people working with them."

Getting ahead

Chenelle de Rozario Harding, a recent addition to the Franklin Templeton team, is a good example of what Walsh is looking for.

A CAIA charter holder and current chapter executive for CAIA Australia, joined Franklin Templeton in July from Future Fund, where she worked for over 14 years in analyst positions allocating to hedge fund and broader alternative portfolios.

Another recruit Thakshi Wijesundara came from Northern Trust.

While she ran distribution there, she earlier covered the debt markets as an investment analyst at IFM Investors and was a senior performance and risk analyst at one of the Big Four lenders.

She is also heavily involved in the superannuation industry serving as a member of Women in Super's Victoria Committee.

Walsh herself has a technical background.

Before arriving at Franklin Templeton, she worked as an actuary for at Willis Towers Watson UK for ten years, advising defined benefit pension fund Trustees and their corporate sponsors.

Walsh is seeing senior institutional investment professionals move from super funds to private wealth.

She puts this down to the move of senior institutional investment professionals from super funds to private wealth.

"This trend has pushed up a whole part of the market in terms of sophistication," Walsh adds.

For instance, legal super investment chief Norman Zhang recently left to join Koda Capital with Australian Retirement Trust's Bruce Tomlinson landing at Minderoo Foundation and Kevin Wan Lum from Energy Super joining LGT Crestone

"Private wealth firms are looking for a sophisticated conversation," she continues.

"With technical backgrounds and experience managing money within allocator roles at super funds, they demand a higher level of expertise from salespeople."

Walsh believes private wealth and family office firms are appealing to investment professionals where individuals can be influential and make decisions more quickly.

Hunters v gatherers

The second requirement for anyone queuing up to be part of Walsh's team is the ability to think collaboratively.

She says the whole process has become more consultative.

Typically, sales have long had a hunt-them-down mentality, which she doesn't believe is optimal for building long-term client relationships in Australia

"Over the past few years, we have been working to flatten our structure to be in a stronger position to service all segments of the Australian market."

"Building a more flexible team that can adapt to the changes in our clients' team structures has been critical to building stronger relationships and creating efficiency in our execution."

This approach is leading to solid results.

Over the last financial year, Walsh shared the Australian business has delivered strong positive net flows across all segments and outpaced their global Franklin Templeton counterparts.

To Walsh, the steady movement of senior investment people across industry segments underlines the importance of a cooperative team.

For instance, she explains, someone might cover a private wealth account, yet an institutional distribution person could have been working closely with that same client through the client's former role.

"We need to ensure the team continues to develop and build on those strong relationships over the years. We view our relationship allocation from a client lens rather than a traditional distribution model lens.

"The broader team recognises the value in that person maintaining that relationship and collaborating to deliver the best outcomes for that client. That's quite a change from before when you would have handed over the relationship.

"So the old fashioned idea of one person owning any one client has gone."