Eric Smith, the chief investment officer of Vanguard Investments’ Asia Pacific business, tendered his resignation at the end of last month, after 12-and-a-half years at the index funds manager. In an email announcing his departure to the industry, Smith wrote: “Why am I leaving now? Because I can. “ I am only the fourth person to leave the investment team in that 12.5 years – something I suspect is an industry record. The four senior members of the investment team have 34 years with Vanguard between them – and double that in the industry. I can leave Vanguard now, confident that my investments with Vanguard will still be in great hands.”
Smith joined Vanguard in 1996, a few months after the global index manager established its Australian arm. He was the fourth person to join the local group, led by the now chairman, Jeremy Duffield. Smith’s job was to establish a local investment capability and grow the business, a task at which he was successful: in his time at Vanguard the team in Melbourne grew from three investment executives within 11 staff, to 27 investment executives among over 200 staff, managing domestic and global assets for clients, in Smith’s words, “from the Netherlands to New Zealand”.
Duffield said Smith had been “a significant contributor” to Vanguard, but declined to elaborate further, saying with a dogged optimism reminiscent of the group’s global founder, Jack Bogle: “I’d prefer to focus on what is in the future, rather than what is behind us.”
Smith will be replaced by Joseph Brennan (no relation to Vanguard chairman Jack), director of Vanguard’s Portfolio
Review Group at its US headquarters in Pennsylvania. He currently heads a 30-person person department in charge of 170 Vanguard funds and 28 external funds managers. He has been with the company for 15 years, and will relocate to Melbourne to take up his new position in March.
Duffield said Vanguard planned to build a more integrated, global asset management business, and the appointment of Brennan was an important step in that direction. The departing Smith said that he had plenty of thoughts for his future, but nothing concrete: “The sweet spot for me was Vanguard’s entrepreneurial phase – less than 50 people, still more opportunity in front of us than already ‘in the door’.
“Without ruling anything out – even a jump out of financial services – my early thinking will be focussed on something with that ‘small firm’ flavour,” he said.