Hermes: Ex Schroders CEO should not be appointed as chair

Firm says appointment of Michael Dobson as chair at Schroders breaches governance principles.

Hermes Investment Management has openly opposed the appointment of ex-CEO Michael Dobson as chair of Schroders.

According to a statement from co-head of Hermes EOS Hans-Christoph Hirt, he considers the appointment of Dobson a “breach of a fundamental principle of UK corporate governance” and said it is “best practice that a CEO should not become chair of the company.”

The statement asks clients of Hermes to vote against Dobson’s appointment, as well as the re-election of the senior independent director who led the chair succession process, at Schroders’ annual general meeting today, Dr Hans-Christoph Hirt.

When news first broke of Dobson’s move from CEO to non-executive chairman, he said: “We know the code says chief executives should not become chair, but the board has decided it is in the best interests of the company, bearing in mind my experience and knowledge of our clients.”

Assets under management more than doubled to £294 billion at Schroders and the firm was one of the first asset managers to combine its trading desks, under Dobson’s leadership.

Fidelity International recently announced a similar reshuffle in its trading business, combining its equities and fixed income desks with the appointment of a global head of trading.

Schroders’ annual general meeting took place this morning.