Fidelity Investments vice chairman and chief operating officer Robert Reynolds last week announced plans to retire, making it almost certain that a woman eventually will run the biggest U.S. mutual fund company, analysts said.
BOSTON — Fidelity Investments vice chairman and chief operating officer Robert Reynolds last week announced plans to retire, making it almost certain that a woman eventually will run the biggest U.S. mutual fund company, analysts said.
Mr. Reynolds, 55, who last year told The Wall Street Journal that he would consider the National Football League commissioner’s job he was up for if it were offered to him, is widely seen as Boston-based Fidelity’s No. 2 executive.
With him retiring, analysts said, the race to the top comes down to Abigail Johnson, whose father, Edward C. Johnson III, is chairman and chief executive, and Fidelity Brokerage Co. president Ellyn McColgan, who was named president of distribution and operations last week.
“If I was going to handicap it today, I would handicap it in favor of Ellyn, just because she doesn’t have the $1 billion already in the bank that Abby has,” said Jim Lowell, editor of Fidelity Investor, an independent newsletter based in Needham, Mass.
Ms. McColgan’s promotion was part of a realignment of Fidelity’s distribution, operations and administrative functions. She will oversee distribution of products and services sold directly to individual investors and via third-party intermediaries — as well as a group of the firm’s other operations, according to Fidelity.
Ms. McColgan, 53, will continue to oversee the brokerage unit, though Fidelity plans to name a new president for the unit. Ms. Johnson, 45, will continue as president of Fidelity Employer Services Co. and will share distribution leadership with Ms. McColgan, Fidelity said.
“In Ellyn and Abby, we have two strong leaders who will work in tandem to provide effective solutions to clients across all stages of their financial lives and through whatever channels they choose to do business with us,” Mr. Johnson, 76, said in a statement.
Although Ms. McColgan and Ms. Johnson appear to be on equal footing, “Ellyn’s responsibilities clearly have increased dramatically,” said John Bonnanzio, group editor of Fidelity Insight, an independent newsletter based in Wellesley Hills, Mass.
“Abby continues to have the same large and important responsibility, but not one that, at least to my eye, has changed,” he said. Who succeeds Mr. Johnson will likely hinge on her job performance over the next several years, Mr. Bonnanzio added.
“There’s always a chance for a dark horse, but I have a feeling that the next chairman of Fidelity is either Ellyn or Abby,” he said.
As for Mr. Reynolds, Mr. Lowell said he doubts that the executive, who joined Fidelity in 1984, is being pushed out.
“I think this was definitely his decision,” Mr. Lowell said.
Fidelity spokeswoman Anne Crowley confirmed that it is Mr. Reynolds’ decision to depart, adding that Mr. Johnson asked him to stay on a few more years, but Mr. Reynolds wants to pursue “other challenges in his life at this point.”
Also last week, Fidelity said that it is creating a new administrative structure.
John Remondi, senior vice president and a managing director of FMR Corp., the legal name for Fidelity, has been named interim chief administrative officer, overseeing such functions as human resources, finance and enterprise services. He will report to Mr. Johnson.
No precise date has been set for Mr. Reynolds’ retirement, and he will remain on through a transition period, Ms. Crowley said.
Mr. Reynolds has made
“tremendous” contributions to Fidelity, Mr. Johnson said in the statement.
“Through the 1980s and ’90s, he led the growth of our 401(k) business to the market leadership position it enjoys today,” he said. “Bob then guided the expansion of that business through various outsourcing and payroll initiatives, and for the past several years has provided the broader firm with dynamic leadership.”
