Following the 2017 merger of Standard Life and Aberdeen Asset Management to create Standard Life Aberdeen, the company’s market value slumped from £11 billion to £5.8 billion. With investors withdrawing £17.4 billion from funds in 2019, and profit before tax one-tenth lower than in 2018, company chairman Sir Douglas Flint convinced Stephen Bird to come aboard and help revive the flagging firm.
Formally appointed as CEO in September 2020, Bird launched a three-year plan to future-proof the business. abrdn is now the UK’s largest asset manager and a FTSE 100 company.
Here’s how Bird rebranded Standard Life Aberdeen into abrdn and reset the company’s fortunes by embracing a modern approach to investing.
Stephen Bird’s Business Transformation Expertise
Bird joined abrdn’s board of directors in July 2020 as chief executive-designate before his formal appointment as CEO in September of the same year. With a track record of delivering exceptional value to global clients, the former banker was well placed to help abrdn thrive.
Bird had spent 21 years with Citigroup, generating high-quality revenue and earnings growth in complicated financial markets worldwide. He also had extensive experience in transforming businesses during disruptive periods of competitive change and technological evolution.
As the new CEO, Bird recognised that the business had struggled overall since the 2017 merger. By carefully evaluating all operational areas, Bird reformulated the executive team and realigned the company’s strategy for long-term growth.
Part of this strategy involved arresting a decline in revenue and slowing the significant outflow of funds. Bird planned a cost-cutting drive and also identified the company’s “confused branding” as a weakness that needed fixing.
abrdn’s Rebrand and Reshaping
Bird led a major rebrand of Standard Life Aberdeen, launching abrdn in 2021. Formerly five separate client-facing entities, the rebrand led abrdn to represent a unified identity with a future-facing, dynamic spirit.
Bird steered abrdn towards a clear, new structure by reshaping the business into three vectors of growth:
- Investments — Crafting investment solutions across global markets.
- Adviser — Supporting UK financial advisers and wealth managers with innovative platform technology.
- Personal — Offering a range of services to help individuals in the UK save and invest.
Today, the vectors collectively manage and administer £508 billion of assets for clients.
Embracing Exchange-Traded Funds
A large aspect of Bird’s strategy to reverse Standard Life Aberdeen’s fortunes was to introduce exchange-traded funds (ETFs).
What Is an ETF?
An ETF is a robot fund that invests in shares in an index, like the FTSE 100. In traditional funds, managers choose stocks that they believe will beat the market. In ETFs, a computer follows investment instructions in a certain group of shares, bonds, or commodities (like gold).
These computer-run funds are cheaper than traditional funds. The annual fee for ETFs is usually low (approximately 0.25% in contrast to around 0.75% on traditional funds). ETF investment reached $9.94 trillion (approximately £8 trillion) worldwide in 2021.
Taking Inspiration From BlackRock
Although abrdn had an established reputation for selecting stocks for investor clients, Bird saw that a modern approach, favouring technology-driven investment, could help transform the company into the UK equivalent of BlackRock in the U.S.
BlackRock’s move into ETFs helped catapult the company to become the world’s biggest asset manager. As of January 2022, BlackRock had $10 trillion (£8.1 trillion) under management in assets.
BlackRock CEO Larry Fink and Bird met whilst working in Asia over 10 years ago. When modernising abrdn, Bird took inspiration from BlackRock’s model, and Fink provided the CEO with advice and support.
Bird spotted another opportunity to grow in the UK’s wealth management market: Whilst providing access to ETFs and other simple investments online, the company would offer financial advice on tax, pensions, and other complex issues.
abrdn’s Revenue Boost and Recent Acquisitions
The first year of Bird’s three-year plan showed abrdn making strong progress and delivering on the company’s growth strategy. 2021 proved a “reset year” for abrdn after the company’s annual results showed that revenues had grown for the first time since the merger in 2017.
Bird had begun assessing bolt-on capabilities in 2020, and, in 2021, abrdn acquired Finimize, a financial insights app. In 2022, abrdn bought the UK’s foremost subscription-based direct investing platform, interactive investor. The platform further transformed abrdn’s ability to empower individuals throughout their financial journeys.
Driven by a renewed statement of purpose — to enable clients to be better investors — abrdn continues to help people plan, save and invest for the future.
About Stephen Bird
Stephen Bird is the CEO of abrdn, the UK’s number one asset manager that has over one million shareholders. Joining the company in 2020, Bird has overseen a complete corporate rebrand and helped grow abrdn’s revenue for the first time since the asset manager’s merger in 2017.
Bird divides his time between his responsibilities at abrdn and his roles as a member of the Investment Association’s board of directors and the Financial Services Growth and Development Board in Scotland.
Bird previously spent over 20 years with Citigroup, joining the investment banking company in 1998 and serving in various leadership roles across Asia and Latin America.
From 2015 until November 2019, he served as the CEO of Citigroup’s global consumer banking. Bird’s responsibilities included all consumer and commercial banking business in 19 countries, including wealth management and retail banking, mortgages, credit cards, and technology and operations supporting these businesses.
Bird earlier served as chief executive for Citigroup’s Asia Pacific business lines across 17 markets. Before Citigroup, he held UK management positions at GE Capital and British Steel.
Bird holds a Master of Business Administration in Economics and Finance from University College Cardiff. He is also an Honorary Fellow at the University.