Taking STANLIB into the future
In March this year, Thabo Dloti was appointed as CEO at STANLIB Asset Management, the wealth management arm of Liberty’s joint venture with Standard Bank. FAnews caught up with him for an update on his first three months at the helm and to discover his vision for the future.
As a student, Thabo Dloti was offered an Old Mutual bursary and subsequently began his career as an Actuarial Assistant at the company. “Since then I’ve worked in almost every division at Old Mutual including heading up the Asset Management and Insurance businesses. I joined the management ranks about 12 years ago,” says Dloti. “While I enjoyed the technical aspects of work before then, joining management was the next logical step for me and I love what I do. I thrive on the complexity of industry issues, relationships and people management.”
In total, Dloti spent 18 years with Old Mutual, working his way up to the pinnacle where he served as CEO of Old Mutual Investment Group South Africa (Omigsa) before joining STANLIB, where his responsibilities include heading Liberty Properties, Liberty Corporate Benefits and Group Risk.
Embracing a new corporate culture
Dloti comments that while the industry issues are largely the same and the skills that he acquired previously can be readily applied at Liberty, the culture of the two organisations are quite different.
“Liberty has a younger culture and there is a lot of new blood here. There are many talented individuals who are prepared to do things differently. My 18 years experience in the industry complements the team’s young outlook perfectly and there are numerous opportunities to achieve great things here,” explains Dloti. “In addition, the Liberty Group seems to have the real Johannesburg ‘can do’ attitude that is so refreshing. I am working with people who are willing to explore and are not afraid of changing their mentality for the greater good.”
One of the most exciting aspects of his new position is forging new relationships. “Meeting new people with a different perspective on common, long standing industry issues is great,” says Dloti. “I find myself constantly being challenged and challenging, and that is invigorating, not to mention highly productive.
“I also love the fact that at STANLIB, in line with broader group’s aspirations, I am part of an organisation with a huge emerging market focus. There is a tremendous opportunity for exploring opportunities in other emerging markets and leveraging of both Liberty and Standard Bank’s presence. In addition, I am enjoying working for a truly South African organisation that understands the unique complexities of a developing nation.”
Facing the challenges
While it has only been a few months since Dloti joined the STANLIB team, he notes that one of the biggest challenges he faces is guarding against is being too inwardly focused. “The group is fluid and being so large there is always going be a fair amount inward focus. While this is important, we need to maintain an awareness of what’s happening in the industry both locally and globally. A lack of external benchmarking and too much of an inward focus breeds internal standards – this is something that large organisations - Liberty included - need to be mindful of. If we want to offer clients the best then we simply cannot afford to exclusively employ internal standards.”
The financial crisis has also created some challenges for the industry. “From a retail viewpoint, investors have certainly become more risk averse,” comments Dloti. “I think that the crisis made many retail investors conservative and many pulled their money from the markets into conservative vehicles like the money market funds. The reality is that while some people may have been shielded from the effects of the economic crisis, investors who pulled money from the markets at the height of the financial crisis have not benefited from the strengthening of the markets. In short, we are seeing investors only getting back into equities well after the market rebound; in fact when equities are already high. Generally speaking, investors without a long-term investment plan and the discipline to stick to it through market cycles, have found themselves in the wrong asset class and paid dearly as they failed in their attempts to time the markets.
“Apart from the risk element, I believe if anything, the crisis has shown a lot of investors the importance of having a long-term plan and sticking to it.”
Views on the industry
Dloti believes that while regulation stems from the need to ensure responsible selling and to protect the investor, there have been unintended consequences to the increasing legislation affecting ‘advice givers’ over the last few years.
“The cost of developing advisors has risen tremendously and it’s expensive to bring in new people into the industry. In my opinion, this is leading to a situation where the high-end of the market is being catered for but increasingly fewer people are prepared to service the lower-end of the market because of high costs. I believe that the regulators need to re-look at the situation and requirements placed on intermediaries. If you take a medical analogy, do we need doctors for every medical issue or will paramedics suffice in some instances? Perhaps we need to look at different tiers of intermediaries in future and adjust compliance requirements accordingly?
“I do think, however, clients are becoming increasingly aware and sophisticated and are looking for financial advisors that offer good advice, who are well informed and who are in for the long haul. Advisors who live off upfront commission will not prosper in a modern South Africa. Those who provide solid and sound advice, and tailor portfolios for the benefit of clients will prosper. The successful advisors have a few common denominators which include providing ongoing affirmation of product sold or solution provided, monitoring the long-term strategy, genuinely caring about those they advise and a commitment to educating clients.”
Dloti adds that apart from being hands-on, the role of the intermediary has evolved to a level where the successful people actually invest heavily in their development and training. “Keeping your fingers on the pulse of latest developments in the financial arena has become pivotal,” he says. “Giving good advice requires a lot of investment of the side of the advisor. It is important to have the best interest of the client at heart and to educate them. The most powerful advert for an advisor is a satisfied client.”
Into the future
“As an asset management company, we are essentially leveraging nothing but talent,” says Dloti. “There is generally a core team that learn together, master how to compete and how to become great together. Talented individuals need to choose to build their careers with a company and all asset managers need a strong core team.
“I want to build an organisation that is consistent and attracts and retains the best people. Everyone argues that there is limited talent. While this may be the case, I would like STANLIB to dominate the talent pool. I also want to create an owner managed mentality with employees who want to leave a legacy. This, I believe will be the stepping stone for greatness.
“Another goal for STANLIB is to leverage of the Group’s reach and presence in emerging markets. This is a huge opportunity and I am particularly excited about this.”
A personal glimpse
Dloti balances his weighty responsibilities with a love of sport. “At the risk of using a cliché, my work is my passion and I find it very therapeutic,” he says. “As a result, I find myself working quite a bit. To provide some balance I do road running. When I am alone and running, I have time to reflect and gather my thoughts. Incidentally, the last run I did was the Two Oceans Half Marathon. I also watch a fair amount of sport with my two sons and soccer and cricket is our pre-occupation at the moment.”
