Fund manager retiring
Anderson to leave Baillie Gifford and Scottish Mortgage
James Anderson: four decades with the firm
James Anderson, one of the UK’s longest-serving fund managers, is leaving Baillie Gifford and stepping down as joint manager of its Scottish Mortgage Investment Trust.
Mr Anderson, who has been with the Edinburgh company for nearly four decades, will retire on 30 April next year.
He has helped drive the trust as a top performer in the FTSE 100 and latterly raised his profile as one of the biggest investors in Elon Musk’s Tesla car manufacturer, making huge returns for shareholders, and as a benefactor of Scottish football.
Andrew Telfer, joint senior partner of Baillie Gifford, said: “James has been central to the strategic leadership and growth of Baillie Gifford.
“He has encouraged us to be ambitious as a firm and has instilled a long term, global and index-agnostic approach to our investing.
“And, most importantly, James has achieved remarkable investment returns for our clients. We are giving our clients a year’s notice that he is leaving the firm.
“Our transition process is tried and tested over generations, and we have developed talented successors in each of James’s teams in recent years.”
Mr Anderson joined Baillie Gifford in 1983 and became a partner four years later.
He led Baillie Gifford’s European Equity Team and after this co-founded the Long Term Global Growth Strategy in 2003. He also chaired the International Growth Portfolio Construction Group from its inception in 2003, until two years ago. He has been manager of Scottish Mortgage since 2000 and, since 2015, joint manager with Tom Slater.
Mr Slater will continue as manager of Scottish Mortgage and as the next step in the long-term transition plan, Lawrence Burns will become deputy manager of the trust with immediate effect (19 March 2021).
“I have huge admiration for Tom and Lawrence,” said Mr Anderson. “They are both thoughtful, dedicated and ambitious investors with a willingness to learn and an outstanding ability to partner with great companies. I couldn’t be happier than to have them as my successors.”
Commenting on James’s outstanding contribution to the trust, Fiona McBain, chairman of Scottish Mortgage, added: “His approach of identifying and holding transformational growth companies has helped drive economic progress and delivered exceptional returns for shareholders.
“James has also pioneered our investments in private companies, one of the trust’s most important strategic initiatives to date.
“James and Tom constantly seek to observe, learn and improve. This has resulted in an investment philosophy that will continue to evolve. I and my fellow directors look forward to working with James, Tom and Lawrence over the coming year, and with Tom and Lawrence after that.”
On 29 April Mr Anderson will be nominated to stand as non-executive chairman of the Swedish investment company Kinnevik AB, a company quoted on the Nasdaq Stockholm Stock Exchange, which is currently held in Baillie Gifford’s client portfolios.
If appointed, he would recuse himself from any investment discussions and decisions about Kinnevik and its underlying investments, while he remains a Baillie Gifford partner. He is also a trustee of Johns Hopkins University, chair of the Panmure House Prize Panel and a benefactor of academia, the arts and football.
Ryan Hughes, head of active portfolios at AJ Bell said the news of Mr Anderson’s retirement “will potentially cause some worry to the thousands of investors who have made fantastic returns over many years“.
However, he says it is important to remember how Baillie Gifford works, with the investment process being firmly embedded in the team-based approach and experienced investor Tom Slater remaining at the helm.
“With Anderson not stepping back for over a year, this has been well planned with a clear handover process for Lawrence Burns to become deputy manager on the trust to support Slater.
“Anderson has helped build Scottish Mortgage into a phenomenal investment trust over many years with his clear, high conviction approach being a driving force behind its willingness to invest in early stage companies and hold them while they become global winners with Amazon, Tesla and Alibaba all being great examples,” said Mr Hughes.
“Since being appointed manager on the trust on the 1 April 2000 he has delivered a staggering 1,700% return, equivalent to turning a £1,000 investment into £18,000 compared to just £4,440 if invested in the FTSE All World benchmark.
“These returns have propelled the trust into the FTSE 100, remarkably making it the 31st biggest company in the market.
“For investors, while this announcement may be unsettling, the strength of the team-based approach, long handover period and continuity through Tom Slater shouldn’t result in major concerns.
“Slater has worked at Baillie Gifford for over 20 years and been a manager on the trust for the last 10 years ensuring that he knows the portfolio inside out. As a result, I expect no change to the approach which should hopefully give investors reassurance that the investment process will remain intact.”