The investment industry of Asia Pacific has evolved in leaps and bounds in the 20 years since AsianInvestor began publishing. To celebrate our 20th anniversary edition we asked a set of the most experienced and senior industry veterans to describe the major changes they have seen, both in their organisations and beyond.
Mark Browning worked in Asia since 1994 and has run Franklin Templeton's Asia operations for 22 years. This tenure is set to conclude when he departs at the end of the year, following the merger with Legg Mason. Over this period the fund manager grew into a business with $70 billion in most institutional client assets.
Browning spoke to AsianInvestor about his experiences in late June, a few weeks before news broke that he will leave the organisation.
Q. What have been the key changes to Franklin Templeton since 2000?
The business in Asia was built out in the mid-1990s and started out with a retail focus, in line with our global operations. Over the years, we have captured the opportunities brought on by the growth of Asian institutional investors. As of now [June 2020], 60% of our [$70 billion of] assets in the region are institutional.
With the growth of sovereign wealth and pension funds, it was a huge opportunity for us, as we were one of the few global players in-country in a lot of these markets.
In Asia, relationships and proximity are very important. Our success was based on a combination of offering our global investment expertise alongside a local presence.
We have offices in nine countries across the region now and our latest office opening was Malaysia in 2009. [Franklin Templeton set up its first office in Asia in Taiwan in 1986.]
Q. How is your institutional business likely to continue developing?
We’ve looked at where firms that have succeeded over the past 10 to 20 years. If you were able to get the business model right in Hong Kong, Singapore, Australia, Japan and Taiwan, you would be successful.
But looking forward, you’re going to need to get China, India, Indonesia, Malaysia, the Philippines and Vietnam right as well. And of those, obviously the biggest opportunities are going to be in China and India.
Q. How has the relationship between asset owners and asset managers in Asia changed in the past decade and how do you see it changing in the next 10 years?
We’ve noticed that the quality of the dialogue between asset owners and asset managers has changed. Initially it was around the portfolio and the asset class. Now it’s now all-encompassing across asset classes, and it’s turning into an OCIO [outsourced chief investment officer]-type model.
Within the next five years I think it will be the norm and the expectation to have real-time discussions on, and access to, portfolios due to technology, rather than just receiving a monthly report on the portfolio.
Q. How does your organisation need to change to maximise its investment performance?
The pace of change is accelerating – so organisations like ours will have to adapt, evolve and try lots of new things at a faster pace.
As for how we can enhance the investment side and maximise returns, technology as an enabler is built into everything we do both, for managing money but also for the operational structure and distribution part of our business.
It’s going to be key for driving performance and efficiencies – across everything from big data to AI – as an enabler for portfolio managers rather than as a replacement for them.
Q. What do you do in your spare time?
I go on two types of holidays: skiing and hiking. I love skiing in Japan, and I’ve hiked in Bhutan, New Zealand, Mongolia, Peru and the Dolomites [among others].
I also read every day – books on business, leadership, economics and geopolitics, and novels.
This interview was adapted from an article that originally featured in AsianInvestor's 20th anniversary edition, which was published in late June.