Portfolio Adviser • Portfolio Adviser March 2019 • Hargreaves Lansdown Refutes Double Standards Claim

● The firm's criticism of the expansion of Evy Hambro's role at Blackrock has provoked an industry backlash

● Research director Mark Dampier defended Lansdown's stance amid claims of preferential manager treatment

What’s the story? Hargreaves Lansdown research director Mark Dampier has denied claims that the direct-to-consumer (D2C) firm holds certain managers like Neil Woodford to a different standard, following criticisms over its reaction to the expansion of Blackrock veteran Evy Hambro’s role.

In February, it was announced that Hambro, who has managed the Blackrock Gold & General Fund for nearly a decade, would be stepping up to run Blackrock’s thematic range, a move Hargreaves analyst Dominic Rowles criticised as “negative for investors”.

Hargreaves’ stance raised eyebrows among some commentators who pointed out that the firm has been less critical of other managers who have had to deal with bigger changes.

Jason Hollands, managing director at Tilney, was perplexed by Hargreaves’ reaction to what amounts to a manager taking on “a few more reporting line responsibilities”. “If that’s a distraction, then there are other cases where managers have taken on the additional responsibilities of running a business and launching a platter of new products, and that didn’t seem to be a problem at the time.”

“It seems like an odd stance to take on Evy,” agrees Ben Yearsley, director of Shore Financial Planning. “It’s weird to pick on that when there are other examples where they’ve let it go.”

PA viewpoint Hollands would not reveal which individual(s) he was referring to but a manager that obviously fits the bill is City titan Neil Woodford.

Woodford has been on Hargreaves’ best-buy list since it began in 2003, despite leaving his former home at Invesco Perpetual to set up his own boutique investment firm in 2014.

Hambro’s fund, which he co-manages alongside Tom Holl, was among the funds axed from the platform’s favourite funds list, which was whittled down to 50 active funds and 10 passives earlier this year.

What the industry thinks Dampier told Portfolio Adviser that Hambro’s evolving role at Blackrock and Woodford’s career change are not the same. He added that Woodford has more support now than when he was a UK equity income manager at Invesco as he has a dedicated compliance team and support from analysts.

“Invesco is a US firm and Neil felt stifled by that. He now feels he has support,” said Dampier.

He added: “What I worry about is people at existing organisations that have a lot of bureaucracy and start doing different things.”

Yearsley thinks Richard Buxton’s Merian UK Alpha fund, that up until recently was among Hargreaves’ favourite funds, is a better example of the D2C firm’s inconsistency.

The £1.86bn fund was on the Wealth 150 while Buxton was chief executive of what was then Old Mutual Global Investors and remained on the list as he was navigating the group through a management buyout. “I don’t remember seeing a note having a go at that,” said Yearsley.

But Brian Dennehy, managing director of Dennehy Weller & Co, said there was too much “hero worship” of Woodford.

“His funds need to be judged on the same basis as others. The criteria needs to be clear and objective, and there must be evidence that it enabled the pinpointing of funds with potential in the past.”

Dennehy said he “didn’t observe such an objective process underpinning the Wealth 50” but was happy to stand corrected.

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