Erich Stock, is the Managing Director, Business Development and Relationship Manager. As a director in the Global Relationship Management Group in Milan, Erich is responsible for establishing and managing relationships and developing consultative partnerships with Continental European clients. He assists European clients with developing long-term investment strategies and policy issues as well as evaluating portfolio risk and performance, and meets with clients to discuss investment- and business-related issues on a regular basis. Prior to joining Wellington Management in 2008, Erich spent over nine years at State Street Global Advisors (SSgA) in London, where he was responsible for their overall institutional business in Italy as well as for their Hedge Fund business development efforts in Europe and Asia (1998 – 2007). Prior to that, he worked in corporate finance at Smith Barney (1996 – 1997) and was a European equity portfolio manager at Lehman Brothers in London (1988 – 1995). Erich has an initial law degree from Université de Paris II Assas (1983), as well as a joint MBA and master of international affairs from Columbia University (1987). He is fluent in Italian, German, French and English.
What led you to dedicate yourself to the financial sector?
I am half Italian and half German and grew up in a multilingual environment across various countries in Europe and the US. So I developed a natural curiosity to get to know people from different backgrounds and cultures. This has led me to look for professional opportunities where I could continue to cultivate these interests while taking advantage of my ability both to communicate in a range of languages and to appreciate the different cultures across countries. This is important. As you know, doing business in Italy is different from doing business in Germany, which, in turn, is different from the way of operating in Spain or the US. The financial sector is global but spans many individual countries, so I saw it as a great place to put my linguistic skills and natural curiosity to use, interacting with different cultures in different countries.
What would you be doing if you did not find a path into business?
I would have done something along the same lines, perhaps in multinational companies in one of several other sectors — anywhere I could enjoy interacting with people from different backgrounds, cultures, and countries.
What does your work look like on a daily basis and what are the problems you normally face? How do you stay motivated?
In my job, there’s no such thing as a typical day, especially since I was asked to open our new office in Milan earlier this year. That has brought some interesting new challenges such as the practicalities of opening an office during the COVID period. But I have to say, most of the day is spent thinking about how to engage better with clients and prospects and how best to communicate with them.
In your opinion, what are the key drivers for successful fund distribution?
I think fund distribution is becoming an increasingly competitive business. In order to be successful, we need differentiated funds that offer solutions to the needs of our clients and actually deliver what they promised. Less related to the actual fund offering, you also need to have a good understanding of how the various distribution networks operate and how best to communicate with them and deliver the tools they need to succeed with their final clients.
What is the greatest challenge in your role as managing director at Wellington Management?
I would say there are two great challenges. The first is internal: to attract to Wellington the most talented people we can find and, crucially, to retain them by ensuring they have an interesting future growth trajectory in their career within the firm. The second is external: how to remain relevant to clients and prospects and have a constructive dialogue with them. We need to deliver investment solutions or ideas that could help them be successful with their underlying clients, whether they are retail clients or the underlying beneficiaries of pension funds. Now that I am based here in Italy, another challenge is how to remain closely connected with Wellington’s main offices. I need to keep the Milan office visible across Wellington and make sure our local clients’ needs are understood and met.
What investment sectors and funds do you think will be of interest to clients in Q3 & Q4 2021?
I believe that, over the next six to 12 months, the move towards more sustainable investments we’ve seen over the last year will continue and will accelerate further in countries or markets where until now their growth has been slower. This trend is driven by new European regulation and by general interest, especially among the younger generations, in investing both for financial results and to do something good for society and the environment. For example, we see growing interest in impact investing. For several years, we have had an ongoing dialogue with our clients and prospects about our Global Impact Equity and our Global Impact Bond strategies, which we have been managing for some time.
In the context of sustainable investments, we believe that active management will have an increasingly important role to play, particularly through engagements with companies to reduce negative externalities such as those related to climate change or bad corporate governance. Furthermore, as economies recover from the COVID slowdown, strategies that will take advantage of the pick-up in GNP should continue to be of interest and attract further attention to specific thematic investments, such as in innovation across various sectors around the world.
Due to the pandemic situation and the economic uncertainty, what are your perspectives regarding the future of the economy?
The risk, in an otherwise positive economic background, is the potential for a new variant of COVID which is resistant to the vaccines that have been developed so far. Currently, it is almost the consensus that there is going to be a strong pick-up in economic growth in developed countries as well as emerging economies thanks to the substantial fiscal and monetary stimulus which has been introduced. The question that will be on everybody’s mind is whether this acceleration in economic growth will result in permanently higher inflation or just a temporary pick-up (and if it will be a gradual increase rather than large and abrupt) that will be difficult for central banks to control. The answer to this question will determine how much higher interest rates will have to go, with potentially negative consequences for financial markets. A closer dialogue with clients and prospects will therefore become even more important.