Dan Boardman-Weston had a number of challenges when he took over as chief executive of BRI Wealth Management in March 2022. First, he had some big shoes to fill. He succeeded his father, Simon Boardman-Weston, who acquired the group in 1991 and over that time has grown it to over 40 employees with a turnover of over £5m. Second, his father stayed on as executive chairman, with a keen eye on the long-term direction of the business.
Nevertheless, Boardman-Weston (pictured) already had plenty of experience, having been involved in the business for over a decade, most recently as CIO.
He had joined on his gap year, enjoyed it so much that when asked whether he wanted to stay on permanently, he set aside university and took a full-time position. He had a brief hiatus in 2017/18, doing an MBA at Warwick Business School, but returned and has been an integral part of BRI’s growth.
The business is well-established, having been going for over 50 years in various guises. However, it has evolved over time.
Boardman-Weston says: “In the early 1990s, it was very much an asset management business, managing stock market portfolios. In 2010, it broadened out into financial planning and, over the past 10 years, we’ve grown that part of the business organically. We now have over £500m of assets in a combination of discretionary model portfolios and other financial planning solutions.”
In common with most advice services, the majority of BRI’s clients are in the decumulation phase, focused on passing on wealth to the next generation. However, as wealth passes on, the team finds themselves serving an increasingly younger client base.
It helps that many of their advisers are also relatively young. The group’s growth strategy, launched earlier this year, has already brought in a number of new financial planners and paraplanners.
This means that the investment engine powering the group’s portfolios needs to be agile. Boardman-Weston is keen not to over-complicate the investment process, focusing on long-term sustainable investments rather than big bets: “We are more long-term oriented – we might be thinking five, 10 or even 20 years in advance.”
In 2016, the group took the decision to start invest thematically, “before it was a buzz word”, says Boardman-Weston. This has seen the portfolios focus on areas such as healthcare, India, or water and waste.
“These are big investment themes that play out over decades. We believe they will be good drivers of investment returns over the long term. We are somewhat sceptical about doggedly investing on geographic lines. The MSCI World, for example, is 60% weighted to the US.
“Allocating a portion of the capital to thematic ideas inherently seems like a better long-term way to invest. It does increase our tracking error increasing versus benchmark, but we believe it helps steer us to the best possible opportunities.”
The investment committee sets investment strategy and asset allocation. It meets 10 times per year, or more if necessary. The team includes Boardman-Weston, plus the researchers and portfolio managers.
He adds: “We take these recommendations to the investment committee who has the overall say on the investment portfolio. All the portfolio managers, including me, do the research.” This is married to the client’s risk appetite.
The investment team employs a range of options when implementing its asset allocation. Boardman-Weston says: “We do quite a bit in direct equities, with 60% or so in closed-ended funds. We also make widespread use of investment trusts; they tend to comprise around 20% of portfolios.
“They help us gain exposure to a slightly different investment areas and give us a better chance to capture outperformance over the long-term. We also quite like property, investing through industrial Reits, and are generally very bullish on industrial property.
“We allocate to other alternatives as well, including infrastructure and ‘wealth preservation’ type assets such as Ruffer, Trojan or Capital Gearing investment trusts.”
The extent to which they will ‘bespoke’ the portfolios depends on the individual. A lot of the group’s clients don’t have complicated affairs and only need a standard allocation. For others, however, it may need to be completely bespoke. The group can accommodate strong personal preferences in areas such as ESG or even impact investments.
He believes the ESG area will become increasingly important and the group has developed a robust process for testing funds’ green credentials.
“Sometimes, when funds say they’re ESG or green, it’s easy to tell if they’re not because they’re holding a toxic company. We’re trying to create portfolios that are more impactful and pure, getting away from greenwashing. The issue you have with that is it can lead to distorted allocations, so we need to manage that. It is a complex area.”
It’s been a tough start to the year and Boardman-Weston remains more pessimistic than the consensus on the outlook.
“We’ve got quite a large amount of cash. We have been very underweight in fixed income for a significant period of time. I suspect we’re closing in on an opportunity to add more to fixed income now. However, if there was more equity strength, we’d be more sellers than buyers.”
He believes the market is becoming tethered around inflation and interest rates, but may not be fully factoring in recessionary pressures.
He adds: “Earnings forecasts have not moved lower yet, which makes me concerned.”
However, he admits there is a dilemma over where to allocate the proceeds of any equity sales. “We’re overweight in infrastructure, plus investment trusts such as Trojan and Ruffer. We’re also overweight in property, particularly the industrial sector and areas with inflation linkage.”
There will be opportunities this year to add to both equities and fixed income, he says, but the market is not there yet. “We’re trying to be a little more risk averse in the meantime.”
His father built the firm’s reputation on being a trusted partner for their clients. Boardman-Weston may have plans to develop the business, but this core value will remain in tact.