Gregg McClymont talks about his new role, cost transparency and the future of defined contribution
Earlier this week former shadow pensions minister Gregg McClymont announced that he would be joining Aberdeen Asset Management in a newly created role as head of retirement savings. PI caught up with him to find out what he’s most looking forward to and how he’s planning to reconcile his campaigning on costs with work at an active management house:
I’m sure you’ve had lots of offers, what made you decide to join Aberdeen Asset Management?
I’ve obviously spent quite a lot of time over the last four years getting to know both the insurance and the asset management side of the pensions space. Over those years, on a number of occasions, I came into contact with Aberdeen and I had developed a view that they were a pretty stand-up outfit.
With the changes over the last year that we all spent so much time talking about, it seems to me that there’s a real necessity to bring savers decent at-retirement products and Aberdeen, I think, are very well-placed to move into that space.
There are obviously lots of good companies out there but Aberdeen have the reputation in the asset management space which then can be extended into that at-retirement market.
What are you hoping to achieve in your new role, and what can you bring to the table?
I think that that knowledge and perspective of what constitutes a good consumer outcome, which I’ve built up over the last few years, I’m hoping to bring that insight and perspective to Aberdeen.
I was very struck by the piece which Martin Gilbert wrote for the Financial Times a couple of weeks ago about how fund managers need to adapt to the new world of at-retirement and deliver on transparency, alignment of interest and quality. On that basis [Aberdeen] seemed a good fit and of course the Scottish dimension isn’t a bad thing either.
You’re well known for campaigning on costs, how are you planning to bring that to bear in an active asset management house?
It’s interesting, isn’t it? Aberdeen is coming from a very strong reputation as an active manager especially of equities and obviously the focus in defined contribution has increasingly been on ensuring low cost.
It often used to be said to me that you mustn’t confuse cost and value… if you’re just focused on cost then you’re not looking at the overall value. I would maintain that of course, that’s an absolutely fair point of view to add to the mix, but getting clean, clear pricing is the first step.
Once there is transparency, unless you’re offering value for money then you’re just not going to be successful. Aberdeen is pretty well-known for being clear in its pricing structures and of course the challenge moving into DC further is how to deliver value at a price which fits into that DC world.
What challenges lie ahead?
It’s a very different environment. I’ve in the past worked in universities and in parliament, so it’s a different environment in that sense. But it’s a big, exciting challenge to take a very well-respected high-profile asset manager and help that company be successful in what’s a fluid and very fast-changing space, with perhaps further fast-changing things to come.
Does this rule out a future return to politics?
No, not at all. I retain my clear political orientation. I remain a committed member of Labour Party.
McClymont’s new role begins effective immediately.