www.the-actuary.org.ukmy biggest achievement. We had a fantastic team that turned it around completely, although I had the vision originally. In the three years before I joined, the UK business had shrunk from 16310bn to 1633bn. Keith Percy recruited me as he realised he could not turn it around on his own and needed someone to run the UK operation. I got rid of the top layer of management and promoted the younger guys. I also brought in some people from Mercury and recruited externally. Everything just gelled and it took off in a major way. By 1997 the business had grown to 16322.5bn from 1634bn and after I left the business it doubled again as most of the team was still in place. If the business continues to grow after you have left then it must have been run well. This is a people business and you have to have the very best people to run it. A bad fund manager is always going to be a bad fund manager. I had to be ruthless to protect the team. You auditioned for RADA as a teenager. Have you ever had to employ your performing skills in the office or boardroom?Communication is very important 8212 everything is defined by it. I communicate with my clients, with investment committees, with my colleagues and all of my staff. At Morgan Grenfell I had to get up in front of 1,200 people to talk to them about the business. I have spoken at conferences and done TV interviews. I did a lot of drama from the age of seven onwards but I think I made the right decision not to pursue it and I can utilise all of the skills that I learnt. What is the most important lesson you8217ve learned in business? To treat people well to get the best out of them. You have to set boundaries so they know how far you can be pushed: in that sense it is similar to being a mother. I do not believe in managing through fear. What attributes make a successful business person?You need determination, enthusiasm and stamina. Be decisive and persuasive. How much value do you think independent advice on manager selection adds to the investment process of a pension scheme? Is this just an additional layer of cost, or is there true value to be gained beyond the advice of the scheme actuary?I think it is essential to have an adviser that understands the industry. Some local authorities manage without external advisers but many corporate schemes benefit from a manager and a financial adviser. Many do not know about investments so we need to rely on people that have the resources and can make a better judgement. I think there is true value to be gained beyond the advice of the scheme actuary. I have managed money for large US and UK pension funds. These people have lots of teams at the centre that know about investments and do not need to employ consultants. Most companies do not have the same level of expertise, however, so employ externally.Do actuaries make good manager selection advisers?I see these as two separate areas of specialism 8212 actuarial and investments. Some investors are not qualified actuaries so they need to recognise that they have different skills. How responsible do you think actuaries are for private sector pension deficits? Are company directors any more to blame?I think that regulation and accounting standards are largely responsible. Everything has been judged on too short a timescale. If markets fall temporarily, I do not think companies should be forced to pump money into a regime that is supposed to last 18 years. The government, the Financial Services Authority and the accounting profession have done this country a huge disservice, meaning that people will have to work for another 40 years to support themselves for InterviewNicola Horlick187 This is a people business and you have to have the very best people to run it. A bad fund manager is always going to be a bad fund manager. I had to be ruthless to protect the team 171 March 2008 2930 years after retirement. Everyone should be encouraged to save 25% to live comfortably but recently the incentive to save has reduced and so too has the onus on companies to provide a way to save. What do you predict UK pension provision will look like in 2020?For the reasons stated, not good. Some people will have defined benefit schemes that will be OK, while some will have defined benefit and defined contribution schemes. Depending on when you retire, instead of getting two thirds of your salary you are going to get whatever is in your pot at that moment in time. In 2040 to 2050, there will be those with a defined contribution scheme retiring and there are people that are relying too heavily on property prices. Residential property is not going to increase like it has in the past 30 to 40 years; we have reached a long-term peak. People have under-pensioned and relied on residential property with the aim to downsize when their children leave or move to a cheaper area. What if they already live in a cheaper area? People have to save for retirement and we need to encourage them to put money into a pension plan. It is incumbent on the government and employers to encourage people to save in the right way. The consumer is over-indebted and the savings ratio is low when it needs to be at much higher levels. Do you think that young workers have been mis-sold the concept of possible early retirement, and if so how can their expectations be changed?Most people understand that they won8217t be retiring young and people definitely realise they will not be retiring at 50 any more. They could end up working until they are 75 just to supplement their income. Lots of people are forced into relatively manual jobs at a later age to get a better income. When people become infirm, the cost of carers and homes is huge. How many will survive that for longer than four or five years? Unlike in France and in Germany, you 187 If markets fall temporarily, I do not think companies should be forced to pump money into a regime that is supposed to last 18 years. The government, the Financial Services Authority and the accounting profession have done this country a huge disservice 171187028_029_30_Actuary_Horlick_0308.29 2919/2/08 11:13:33
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