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James Edgedale

The chairman of JM Finn & Co believes in a sense of traditional business values and is looking to help overstretched IFAs meet the demands of the RDR. Interview by Gregor Watt

In a world where it is now not only common to have several different employers during a working life but also possible to have more than one career, James Edgedale is an example of a more traditional approach to employment.

He is chairman of independent private client stockbrokers JM Finn & Co and the firm seems to have a traditional approach to matters. This year, Edgedale celebrates 25 years with the company but his current role is a far cry from his early days with the company he joined in 1984, straight from university. In the years before Big Bang and the computerisation of dealing rooms, Edgedale’s first job was prov- iding prices to the traders the old fashioned way.

“My first role was on a thing called the dealing board, literally putting prices on a blackboard and giving orders to the dealers on the market floor.” He grad- uated to trainee stockbroker before spending time on the admin side of the business. “I did six months on the market floor as a blue button, which was great fun, I then wrote cheques for a year, which is one of the most boring things I have done in my life.”

His time in the back office did nothing to hinder his rise through the firm. His next position was as assistant to a partner and after only six years with the company and at the tender age of 27, Edgedale became a partner himself. “I progressed to being an assistant to one of the partners, which I did for three or four years, until I became a partner and he retired.”

He became senior partner in 2000 and chairman in 2006 when the business incorporated.

Despite its modern offices in the heart of the city, JM Finn feels like a traditional stockbroking firm and Edgedale is keen to point out that the firm is different from its competitors in that it has resisted transforming the business too far and has stuck to what it knows best.

He says the business remains at heart a private client stockbroker, not a wealth manager. “We are effectively a firm that manages clients’ money, as simple as that, and not a wealth manager. I do not like that description but we manage portfolios on behalf of our clients.”

Edgedale maintains a hands-on role within the business, advising many of the clients he inherited when he became partner in 1990.

“It is very important that one is involved in looking after clients, so one understands everything that affects the fund managers, understands the market, therefore decisions made on behalf of the firm are with an understanding of what is driving the firm.”

He credits the quality of the senior management team, led by managing director Steven Sussman as well as the staff on his desk for allowing him to combine the two roles.

But despite its traditional feel, the business has modernised and expanded over the last 10 years. Edgedale says the modernisation process started in the mid-1990s and was something he was keen to continue after he became senior partner and then chairman.

“The main priority for the business from the mid-1990s onwards was to build ourselves up into the modern world in terms of compliance, IT systems, build up our capital and to really bring the business up to where it should be and then from that point onwards to grow.”

The modernisation process has paid dividends. Since 2000, Edgedale says assets under management have roughly trebled to £4.4bn, not including execution-only business.

Staff numbers have also increased substantially. In 1990, the firm employed 110 staff across its private client and institutional business. Today, the firm employs 285 at JM Finn, with a further 40 employed by subsidiary company FinnCap.

“The main growth has been the ordinary private client investment management business in London but we have also built up four branch offices and we have expanded our activities in corporate finance and institutional sales through our subsidiary Finncap.”

Finncap is the former corporate advisory and institutional broking division of JM Finn, which was set up as a separate business in 2007.

dgedale reports that since then, the business has gone from strength to strength. The company now has 62 corporate clients, mainly Aim-listed firms, and has avoided many of the pitfalls that have dogged its competitors. “Finncap itself has done extremely well over the last two years, partly as a result of the failure of its competition. They have been in the fortunate position not to be quoted, to have a mother company which has supported them and we are reaping the benefits.”

Perhaps the most noticeable change to the business to external observers is the addition of the branch offices to Finn’s traditional London base. The firm now has four other regional offices in Bristol, Leeds, Bury St Edmunds and Ipswich.

Edgedale says he is keen to grow the existing offices but has no specific plans for adding any more at present.

Instead, he says growth will come from expanding the company’s existing operation and one area that he sees great potential in is the IFA market.

JM Finn offers two main services – the discretionary management and portfolio advice. It is the portfolio advisory service that Edgedale sees as being of most interest to IFAs.

Edgedale says the retail distribution review is going to put even more pressure on IFAs and stretch their resources. He hopes that JM Finn will be able to step in to help take some of the pressure off.

“As we approach 2012, a lot of IFAs will not have the substance to be able to continue to manage unit trusts on behalf of their clients. There will be a huge consolidation in the industry, and hopefully we will be able to continue to interact with those IFAs because we can offer the service to manage the unit trusts.”

But Edgedale emphasises the business has been careful not to stray into financial advice and it has no inclination to change itself into a business that does anything other than manage investments.

On the day of our interview, he received an email offering two IFA businesses for sale but he says this is something they are simply not interested in. “It is very important that we stick to what we can do, that is, managing money.”

The firm wants to ensure there is no potential clash with professional introducers. “It is the same with anybody else offering a personal service, as soon as you cross that mark, you are going to have a conflict of interest. We have seen this with so much of our competition.”

Born: London, 1963
Lives: Oxfordshire
Education: Eton College; Bristol University, politics and economics
Career: 1984-present: from trainee stockbroker to chairman, J M Finn & Co
Likes: Golf, horse racing and most forms of field sports
Dislikes: Probably better I don’t say
Drives: Audi A6 estate
Book: Most forms of current fiction while on holiday
Film: Anything the children are watching
Album: I will pretty well listen to most things but try to avoid whatever the children are listening to.
Career ambition: I want the firm to continue to grow as it is today and continue to improve the offering we give to our clients.
Life ambition: My ambitions outside the office relate to my family
If I wasn’t doing this I would be…I am very happy doing what I am doing but if I hadn’t gone into stockbroking or the City, I would have liked to have spent five years in the army and I would possibly have been a racehorse trainer but that is not very commercially sensible.


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