The decision to scrap the abrdn name is an admission of failure, but the board can focus on an improvement in performance, says TERRY MURDEN
Abrdn is no more. Welcome to ‘aberdeen group’, the new name of the asset manager, its third in just over seven years. It may have lost a lot of value and some of its dignity over the years since its creation from an £11 billion merger as Standard Life Aberdeen, but at least it has got all its vowels back.
Alas, attempts to remove confusion may continue. It is not based in the granite city of the same name but remains in Edinburgh (and London, where a lot of the heavy lifting takes place). It has also opted for a lower case first letter, much to the irritation of journalists and other writers who prefer to begin sentences with capitals.
Jason Windsor, who is also the third CEO since the merger (if you count Martin Gilbert and Keith Skeoch’s co-CEO reign as one), was only partly apologetic when he explained the board’s u-turn after so many years defending it from ridicule.
“I just didn’t want to make a big scene over this, but equally I wanted to change it,” he told journalists. He said the word ‘Aberdeen’ resonates well around the world. “The name ‘in my mind’ hasn’t changed, but I don’t want it to be a distraction.”
To counter claims that the abrdn rebrand had been a colossal waste of time and money, he confirmed that the decision to revert to ‘aberdeen’ had been taken in-house, with minimal impact on costs. Chairman Sir Douglas Flint had told shareholders in 2022 that, contrary to stories of fantastic fees being paid, the abrdn name had also been decided internally and merely “benchmarked by one of the world’s leading brand advisory agencies”.
At the same meeting it was stated that four months after launching the abrdn name it was second only to Blackrock in an independent measure of brand strength. The indexing firm said they had never had a client climb so many places.
However, it was about as good as it got. It has never won favour with those who have continued to mock it and more questions were raised as recently as January in a media call with journalists when Mr Windsor said there were no plans to change it.
Last summer he replaced Stephen Bird, who must now carry the weight of the ‘abrdn’ debacle but who’s bigger influence was attempting to revive a flagging insurance and pensions business. He arrived from Citigroup, where he spent two decades, and set about streamlining the company around three business strands: global asset management, technology platforms for UK financial advisers and their customers, and UK savings and wealth. He introduced the abrdn brand and disposed of several businesses, not least the historic Standard Life assets to Phoenix.
The board seemed less than impressed and installed in his place the recently hired CFO Mr Windsor who will be disappointed that he allowed the latest name change to overshadow a tidy set of annual results.
It’s no exaggeration to say the company has gone through a turbulent few years. Aside from the impact of the rebrand, it has twice been ejected from the FTSE 100 share index and embarked on a large cost reduction programme, resulting in job cuts and fund closures, including its one-time flagship fund GARS. Its value has slumped to under £3bn.
Signs of a turnaround are starting to emerge with a slowdown in the withdrawal of funds to a net £1.1bn and investment returns have improved, with more of them beating their benchmarks. Total assets under management rose 3% to £511bn over the year. The shares responded, up 7.69%.
Mr Windsor who has so far sounded upbeat and optimistic in each his presentations to the media, says the company is building momentum and, after years of being promised jam tomorrow, analysts and investors seem to to be warming to the company.
In a note published after the annual results, Panmure Liberum said: “The market has not believed in aberdeen (yes, the ee’s are back) either in the ability to get costs out or to have a strategy for growth.
“That view is challenged today.”
On the day the abrdn name came into effect in July 2001, Mark Polson, principal of the Lang Cat, said: “What is actually important to firms and their clients comes down to two questions: is this a safe home for my clients’ money, and can it assist me in delivering my service and investment proposition to my clients?”
“If the answer to these two questions is yes, the brand stuff doesn’t really matter so much.”
He was only partly right. The company has not put itself through another renaming exercise just for fun. The “brand stuff” has been a constant thorn in the company’s side. Last year its chief investment officer Peter Branner accused the media of engaging in a “childish” game by continuing to pick on its controversial missing vowels. He labelled it “corporate bullying”.
However, the media was not alone. The rebrand was highlighted in an episode of the satirical TV programme Have I Got News for You, while on social media it was jokingly likened to an episode of Countdown in which contestants request vowels and consonants.
There is only so much ridicule anyone can take. It’s now up to Mr Windsor to put this episode to bed and prove to investors that there’s more value in ‘aberdeen group’.
Terry Murden was Editor and Business Editor at The Sunday Times Scotland, Business Editor at The Scotsman, and Business and City Editor at Scotland on Sunday. He is now Editor of Daily Business.
Leave a Reply