"Looking for a new chief executive? Why not hire an equity analyst?"
I'm not sure that's a good idea but I haven't had much luck with companies run by attorneys either. With the lawyers they either remain in the "Thou shalt not" groove of the wise counselor or they go a bit nuts because they think they're no longer an officer of the court.
With the analysts you, somewhat surprisingly, run into the same problems you do with economists: "Sure, it works in practice but will it work in theory." And the "On the other hand..." stuff. Don't even get me started on Elliot Wave practitioners with their alternative wave counts introducing a third and a a fourth hand.
Anyhoo, the equity analysts are going to need to do something after AI takes their jobs so maybe give them a shot at the C-suite. But watch those hands.
From Financial News London, May 25:
It might seem an unlikely move, but capital markets experience is increasingly valuable in the C-suite
Standard Chartered had some compelling reasons to promote Manus Costello -
As
a former equity analyst who covered the bank for many years, Costello
is very familiar with the bank’s strengths and weaknesses, and those of
its rivals. He knows its investors well, understands what they are
looking for and speaks their language.
Since
joining Standard Chartered as head of investor relations two years ago,
Costello has built a good rapport with chief executive Bill Winters,
who says he has made a “significant contribution to the group’s
strategic positioning and engagement of stakeholders”.
While
very familiar with the business he also brings an outsider perspective
that many management experts would say is an ideal combination.
Yet
this raises a question: if it is such an obvious move why don’t more
analysts become senior executives in the sectors they have covered?
In
financial services, the numbers are strikingly small. One of the few
prominent examples is Sallie Krawcheck, who made her name as an
independent-minded analyst of Wall Street banks at Sanford Bernstein. In
2002, she was hired by Citigroup to rebuild trust in its research and
wealth management business after accusations of conflicts of interest.
Two years later she was appointed Citi’s chief financial officer.
In
the UK, Luke Ellis, former chief executive of hedge fund manager Man
Group, previously worked for JPMorgan, though in equity derivatives
rather than research.
Another former
analyst who is now a chief executive is Anthony Noto. A one-time
Goldman Sachs internet analyst, Noto was appointed head of financial
technology firm SoFi in 2018. But Noto shifted into banking at Goldman
before going into the industry, which makes him a slightly different
case.
There are plenty of bankers who move into the industry they covered. Current examples include Jonathan Sorrell, the former Goldman banker who now heads wealth management group Rathbones....
