‘Second career’ sees CEO learn something new every day as he dives into fairly choppy waters
Precisely three years into what he calls his “second career” and David Nicol is clearly a man with a plan. The Glasgow-born, Scots-educated chief executive of Brewin Dolphin – one of Britain’s foremost wealth management firms – is determined to expand the business amid a challenging backdrop of industry consolidation, a population facing an uncertain financial future in retirement and technological upheaval.
Nicol spent 26 years working for financial giant Morgan Stanley before joining the Brewin board as a non-executive director in March 2012. Just a year later, he had taken the reins following the departure of executive chairman Jamie Matheson – a familiar face in the City for around four decades. Nicol took up the top post as part of a boardroom shake-up that also saw the appointment of a chairman, Simon Miller.
“I think we are about to enter a good time for the business,” says Nicol, speaking following a board meeting held in the firm’s Edinburgh offices perched on the sixth floor of the Atria complex on the city’s Morrison Street.
“We have a very strong balance sheet and are profitable and can really take advantage of that. The firm has been through a period of transformation and the name of the game now is to focus on growing the business.”
Full-year results for the firm – which can trace its roots back to the establishment of the stockbroking business John Dawes, a founder of the London Stock Exchange, in 1762 – revealed that adjusted pre-tax profit had risen 7 per cent to £62.2 million, with total income nudging up 1 per cent to £283.7m. While total funds under management dipped to £32 billion from £32.5bn, a first-quarter update for the current year – released in January – showed that had rebounded to £33.2bn.
Nicol, who retains his Scots accent despite having left his native city in the early 1980s, says the focus will be on organic growth, though bolt-on acquisitions have not been ruled out.
Over the years, the group has been involved in a string of takeovers and mergers, including the 1993 acquisition of venerable Scottish practice Bell Lawrie – rebranded Brewin Dolphin in 2008.
“We have a good regional footprint around the country and have good financial planning expertise,” notes Nicol. “Our marketing has also been revamped and we are redoing sales training for our staff. There is no one silver bullet but rather a range of initiatives.
“The other thing is whether we should participate in consolidation activity. While we are clear that we will look at these opportunities, it is also fair to say they are more difficult than might first appear. Assets are still pretty expensive. We have to be judicious about how we use our capital.”
He adds: “The reason the market is so fragmented is that culturally and strategically it is sometimes difficult to make those acquisitions fit.”
Nicol is keen to “get out there” and tap into areas such as professional services – lawyers and accountants – as well as targeting the likes of dentists and doctors, while eyeing regions “where we maybe haven’t been quite so strong”.
Those sort of potential, middle-class clients may not be the traditional high net-worth individuals and entrepreneurs with hundreds of thousands to invest but Nicol talks of an “advice gap” when it comes to financial planning.
“We give pretty full advice to our higher end clients but, for the man on the street, the government needs to look at making it simpler and perhaps slightly less regulated.
“There is a happy medium where you can provide basic simplified guidance around, say, what do to with an £80,000 pension pot. We could provide that without giving the full-blown, gold-star advice we give to our bigger clients. The regulatory system makes it quite difficult for us to do that without incurring future risks.”
Despite the onslaught of technology and roll-out of so-called “robo-advice” in some areas of the financial services industry, Nicol puts forward a strong case for maintaining human contact.
“It is very hard for an algorithm to figure everything out,” he argues. “Face-to-face advice is there to stay for anyone with more than a couple of degrees of complexity in their lives.”
Nicol trained and qualified in 1980 as a chartered accountant with Ernst & Young and spent two years working for KPMG in Hong Kong before joining Morgan Stanley in London in 1984, pre-Big Bang and with a “very small team of about 150 people”, he recalls. During his lengthy tenure with the group, he helped set up a presence in Glasgow – an operation that can now boast some 1,300 people, making it Morgan’s second largest location in Europe after London.
Nicol jokes that his stint at Brewin is unlikely to match the length of time spent at his previous employer.
“Look, I learn something every day in what is a second career for me. I have just turned 60 but still feel young and will do this as for as long as the board, shareholders and staff think it is the right thing. I don’t think being a CEO of a public company is a ten-year job though.”
He is adamant on one other matter: “I would never want to be a politician. What has happened in Brussels has put everything in perspective. I think we should be working together on some of the complexities and challenges we face across Europe.”
30 SECOND CV
Job title: CEO, Brewin Dolphin.
Education: Strathclyde university, ICAS – CA.
First job: Accountant at Aymm (now EY).
Favourite mode of transport: Train.
What makes you angry? Nothing really.
Favourite place: Arran.
Best part of job: Learning something new every day.