Standard Life Investments adopts institutional sales model

Standard Life Investments (SLI) has revamped its Asia-Pacific business model away from the wholesale funds approach it uses in its UK home market.

Although it continues to maintain relationships with private banks operating in Asia, the firm’s business model is oriented now towards winning institutional business, says George Walker, Edinburgh-based head of Asia-Pacific business development.

He says SLI’s initial move into Asia in the early 2000s was more retail focused, aiming to get its products on bank shelves “and hope people buy them”. But the firm’s brand presence in Europe didn’t extend to Asian consumers.

Now the firm has changed its staff and approach, with a preference for ‘guided’ or advice-driven distribution relationships, as well as working for institutions.

Its Australia presence has been upgraded from a rep office to a registered business, now run by Simone Bouch, who joined from Morgan Stanley. David Peng, formerly of BlackRock, is heading Greater China business development, with Ji Hong serving as rep in Beijing. And Seiichi Fukuyama, formerly BlackRock’s Asia chairman, is serving as a strategic adviser to the business.

The firm has also retooled its product offering. Previously it was trying to sell sterling-denominated, UK product to Asian clients – which didn't work. It has recently adopted a Sicav funds range offering products in US dollars, Australian dollars and Singapore dollars.

“We have since won our first institutional mandates from Asia,” says Walker.

The firm is also competing with a focus on absolute-return and alternative investments, as well as multi-asset solutions that aim to provide a steady return above cash. This can include exposures to real estate, private equity and a variety of credit exposures, along with global equities.

“We developed our multi-asset product for our in-house defined-benefit pension fund, when it faced a funding shortfall,” says Rod Paris, CIO in Edinburgh. “It needed returns while protecting its principal.”

Walker says this coming year will see SLI boost hiring in Seoul, under its rep Michael DeVere, and in Hong Kong. The firm will also transfer Jason Lam to his native Hong Kong for regional business development, working under Peng; he joined SLI last year but has been initially based in Edinburgh.