Hargreaves picks new boss to clean up Woodford mess: Tech veteran Dan Olley takes helm of investment platform
Hargreaves Lansdown has named a new boss as it prepares to deal with the fallout from the Neil Woodford saga.
The investment platform has announced that tech industry veteran Dan Olley will succeed Chris Hill, who announced his resignation in October.
It comes as Hargreaves tries to strengthen its business, with a focus on improving IT systems and online sites.
Tough test: Industry veteran Dan Olley, left, faces fallout from Neil Woodford scandal
But Olley will take the reins at a difficult time as the firm faces legal action and the outcome of a regulatory investigation into its conduct that led to the fall of Woodford’s investment empire.
Olley, 52, originally joined the board as a non-executive director in 2019.
He said: “It is a company with an outstanding track record, a strong strategic position and a formidable brand. I am extremely excited to lead the company through its digital transformation and into its next stage of growth. »
Earlier this year, Hargreaves revealed it was investing nearly £200m in boosting its technology, which took a hit to shares.
Bosses claimed it would take it to the ‘next phase’ of growth, but Ben Yearsley, director of Shore Financial Planning, said: ‘The downfall for Hill was that he had to announce a £200million outlay. pounds for technology, which made it look like they had been underspending for years.’
Yearsley said he hadn’t heard much about Olley, the former chief executive of market research company Dunnhumby and former executive of data analytics firm Relx, but his appointment was a “interesting decision”.
Hill resigned just weeks after litigation firm RGL Management filed a suit against Hargreaves in the High Court on behalf of 3,200 investors caught up in the Woodford implosion. Hargreaves denied any wrongdoing.
The investment platform was one of the first companies to come under scrutiny when the Woodford Equity Income fund was suspended in 2019.
Hargreaves recommended the troubled fund to clients through its so-called “best buys” list until it was suspended in June 2019.
Around 133,000 Hargreaves clients have invested directly in the fund, many of whom blamed it for promoting Woodford after suffering heavy losses.
Just weeks before the fund closed, Hargreaves’ now-retired director of research Mark Dampier told clients: “We think [Woodford’s] still has the skills to deliver excellent long-term performance.
But thousands more have also been indirectly exposed because they have invested in Hargreaves’ “multi-manager funds” – money pots it manages that spread cash across a variety of funds.
In total, around 300,000 Hargreaves clients are thought to have been exposed to Woodford’s investment empire.
Experts have criticized Hargreaves, founded in 1981 by entrepreneurs Peter Hargreaves and Stephen Lansdown, for recommending the fund for as long as they have.
For several months before its collapse, its performance had been poor – and there were signs that Woodford was starting to change its strategy to invest in riskier and earlier ventures.
When the fund was shut down, Hill was forced to apologize to Hargreaves clients. His behavior will be scrutinized in the lawsuit brought by RGL, which also targets Link Fund Solutions, the company supposed to oversee the management of the fund by Woodford. Hill was boss for just under six years. Yearsley described his tenure as a “total disaster”.
While investment platforms profited from the pandemic, as households sought to invest the extra savings they had accumulated, they were weighed down by the cost of living and fears that the weakening of the global economy harms business growth prospects.
Yesterday, shares of Hargreaves edged up 1.8% or 15.4p to 850.4p.
Olley takes over from Hill in November next year.
