MiB: Jenny Johnson, Franklin Templeton CEO

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This week, for our particular five hundredth episode of Masters in Enterprise, I communicate with Jenny Johnson, president and chief govt officer of the Franklin Templeton. Johnson joined the agency in 1988 and held management roles in all its main divisions earlier than turning into CEO in February 2020. She additionally led the historic acquisition of Legg Mason in 2020, and Putnam in 2023, with the group now managing greater than $1.5 trillion globally. Amongst many different accolades, she has been named to Barron’s listing of the 100 most influential girls in US finance for 3 consecutive years, most lately in 2022.

She started at Drexel Burnam, getting her ft moist studying operations as a really junior worker. When she returned to Franklin Templeton, she rotated by varied divisions, together with funding administration, distribution, know-how, operations, and high-net-worth.

There’s a historical past of acquisitions at FT, going again to the October 1992 acquisition of Templeton, Galbraith & Hansberger for $913 million. (This led to the agency’s present identify from its prior “Franklin”). Bringing on mutual fund pioneers Sir John Templeton + John Galbraith led to a crucial mass on the agency.

Johnson has since led a number of acquisitions, together with the 2020 all-cash deal for Legg Mason valued at $4.5 billion; Final 12 months, FT bought O’Shaugnessy Asset administration, together with its breakout direct indexing product Canvas, for an undisclosed quantity; this 12 months, FT bought Putnam for $925 million. Every of the acquisitions crammed in a gap in Franklyn’s suite of merchandise. The agency continues to increase, wanting overseas for extra progress, together with India and the Center East.

We additionally mentioned lively administration versus indexing:

“In case you are an lively supervisor, your job is to have a diversified portfolio and take into consideration risk-adjusted returns. When you’ve a momentum market [like now] and you’ve got 5 corporations that take their 25% of the index, an expert supervisor will get nervous by that kind of focus, say the S&P 500. There’s not sufficient dialogue about how the market threat of the index adjustments relying on [a few stocks]. The day Tesla was added to the S&P 500, it grew to become a a lot riskier funding based mostly on volatility and focus. In these kinds of markets, it’s arduous for an lively supervisor.”

An inventory of her favourite books is right here; A transcript of our dialog is accessible right here Tuesday.

You’ll be able to stream and obtain our full dialog, together with any podcast extras, on Apple Podcasts, Spotify, Stitcher, Google, YouTube, and Bloomberg. All of our earlier podcasts in your favourite pod hosts might be discovered right here.

Remember to try our Masters in Enterprise subsequent week with Tom Wagner, Co-Portfolio Supervisor at Knighthead Capital. The $10 billion event-driven is a deep value-focused investor specializing in corporations that want monetary and operational restructuring. He’s a co-investor with soccer legend Tom Brady in a number of sports activities property, together with a Pickleball staff, Birmingham Metropolis FC within the English Soccer League, and an endurance auto racing staff. Wagner started his profession doing hedge fund accounting at Ernst & Younger.