Towards the start of his 40-plus years in financial services, a newly married Alan Burton applied to join a company he hadn't heard of because it paid a £100 a year more than the market rate. The company he joined as a trainee inspector was Standard Life.
“When I first started selling 37 years ago and I said I'm from Standard Life, they said 'who?' Some of them might not like us but there won't be an IFA in the country who doesn't know who we are now,” he says.
Burton has just retired from what many would view as a glittering career helping steer Standard Life Investments to its current credible position as an investment house.
But 40 years ago, it was a different world. His first job with Standard saw him working in Kent. One local broker had a life and pension department while the rest were a ragbag of solicitors running agencies, motor insurance brokers and bank managers including one Rochester banker who was doubling his £2,000 a year salary with his own agency. Products were mostly endowments, which guaranteed the cost of the mortgage with bonuses on top and the occasional personal pension. The rich used stockbrokers. “You never really came across anyone selling collective investments,” he says.
He takes obvious pride in the fact the mutual fund industry is now fully fledged and largely untainted by scandal. But he still has misgivings about financial services in general.
He has spent the last few weeks wondering why in the 1960s an unregulated and haphazard industry was trusted when the regulated advice driven world today is not.
He says: “The industry hasn't managed change well. We had a big scramble for market share in the 1990s. We were all guilty of not describing risk well. We tell them the upside and then the downside, but you don't qualify the upside – you qualify the downside.”
He adds: “People are no longer prepared to accept the 'I know best so trust me' attitude. The concept of “trust me” doesn't work if people don't trust you.”
Burton worked his way up through the ranks of the sales force moving to management in Nottingham before moving to Edinburgh “for three years” 17 years ago.
One of his roles was to head the annuity side of the business. He adds wryly: “Never write a paper about how you can do anything because you are going to get the job to do it.” But you feel that it was getting the job of helping create a thriving mutual funds business in 1994 that really seized his imagination.
The business brought together Standard's already existing unit trust business and money from a previous joint venture with Halifax.
Burton set about extending the fund range and working out how to sell it to IFAs.
The analysis was that Standard could utilise its brand and a salesforce of 400 to reach the 80 per cent of IFAs the average fund manager with a salesforce of 10 could not reach.
The twin strategy was to get it right on service – and establish a decent performance track record.
But Burton admits his biggest initial mistake was to think a life and pensions salesforce would be able to sell unit trusts from the off. They could not, partly because they were not versed in what rival fund houses were doing. The solution, learned the hard way, was to back them with a team of specialists to take referrals.
He says: “When you come to marketing, people try to work out which bits you can leave out to save money. So far I haven't found any bits you can leave out.”
Spun out of Standard Life proper in 1998, SLI now has what most IFAs would consider the full line-up of fund managers, one of whom Burton was involved in recruiting.
“I was involved in persuading UK opportunities fund manager Mark Niznik to come here. The CIO found him but part of the deal was he wanted a fund. The question was whether we could support that kind of fund. We managed to find something we had lacking in our portfolio and that we could sell,” he says.
SLI, based in St Andrew Square in Edinburgh, seems to be thriving. Ten minutes in the waiting room sees upwards of 20 people from all over Europe pass through. Burton is clearly happy that when SLI set up an office in Boston, people there had heard of the company. He also notes that the SLI drinks party at IMA dinner is packed these days while years back no one came.
Burton is a forceful proponent of the view that life office-owned investment businesses can work. Suggesting otherwise always brings a call and it was a case Burton made in Money Marketing only a few weeks ago.
But his career has not just been about Standard. Burton played a significant role in Autif and was its last chairman before it become the IMA. His work included redesigning the sector classifications.
But perhaps the sweetest victory was over past performance in advertising. “We won a battle with the FSA over past performance though they wouldn't admit it. It would have been totally ridiculous not to give people information they wanted” Burton's heroes include Standard's Peter Glover, who helped lead the campaign for independent advice and without whom he believes there would be fewer IFAs, Julian Tregoning the man who convinced the Government to make corporate bonds Pepable and Alan Ainsworth for his work in building Autif.
His villains are people who concentrate on adding basis points without producing a product consumers need. “I get mad at people who reinforce the concept that we are trying to rip them off.”
With so much experience, it seems pertinent ask why the industry is still facing misselling accusations. He says there are too many young people and not enough “grey hairs” who can remember 1974 and 1987 and who realise how markets can fall.
Burton plans to use his retirement to spend more time fly fishing but he does not want to get under his wife's feet too much so he would be open to offers of non-exec posts. Maybe some company of young hotshots still trying to come to terms with the long bear market should keep him in mind.
Born: 1943, Hendon.
Lives: East Lothian.
Education: Christ College, Finchley.
Career: 1960, first job at Prudential in the life underwriting alterations and new business department. 1966, Standard Life trainee inspector, progresses through Maidstone, Canterbury and Kingston, moves to Nottingham as branch and then area manager,1986, moved to Edinburgh as national sales manager, 1988, marketing manager life, agm product management life, 1994, chief executive Standard Life Fund Management, 1998, managing director mutual funds Standard Life Investments, Retires 2003.
Hobbies: Fly fishing.
Likes: People who have a clear direction know what to do and do it, wine, rather too much.
Dislikes: Two-faced people.
Ambition: To live long enough to see I get the benefits of the pension scheme and to watch my grandchildren grow up.
Car: Mercedes MLS zCDI 4×4.