Director talk: John Newlands
John is chair of Develop North and a director of Gabelli Merchant Partners and CQS New City High Yield Fund.
In the boardroom
How would you explain your role to somebody that was new to investment trusts?
Non-executive directors are independent overseers of shareholders’ interests. It is their duty to monitor, to question, to praise and, where necessary, to warn.
Who’s been the biggest influence on your career?
The legendary Scottish analytical duo of Robin Angus and Hamish Buchan, sadly neither of whom are still with us. They helped me understand the numbers which matter – and steered me through the minefield faced by late entrants to the Square Mile.
I will echo Margaret Thatcher’s Desert Island Discs choice – poached eggs on buttered Marmite toast.
John Newlands, chair of Develop North and a director of Gabelli Merchant Partners and CQS New City High Yield Fund.
What is the proudest moment of your career?
In 1990 Globe Investment Trust, at that time safely the largest in the sector, disappeared “overnight” having been acquired by British Coal Pension Funds at a discount, wound up and its assets liquidated.
In early 2011, the seemingly impregnable Alliance Trust faced a similar challenge from a concert party of investors – attempting, as far as I could see, to gain control of the trust and put its own people in. On behalf of my then employer, Brewin Dolphin – and its countless clients invested in Alliance – I challenged the board and managers of Alliance Trust to act, primarily by introducing their first ever discount control mechanism (DCM) and head the marauders off.
Manager Katherine Garrett-Cox and the board took decisive steps, including bringing in the discount control mechanism, fended off the “barbarians at the gate” and won the day.
Had this lesson from the Globe debacle not been heeded, it is quite possible that the £5.6 billion investment trust Alliance Witan would not be around today.
What’s the most challenging part of your job as a trust director?
Taking the right steps when things aren’t going well, for instance during a period of bad performance. It may be more important to support a valued manager during an uncharacteristically poor phase than to heap praise where a fund has risen with markets like a boat on a rising tide.
What advice would you offer to new directors?
Keep up to date with sector news, brokers’ research and press coverage. Attend as many AIC and other key networking events as possible. Follow peer group funds as well as your own, which will allow you to benchmark things like fee structures.
Lastly, be the one to ask the question everyone is itching to ask but holding back!
Away from work
What’s your number one desert island disc?
Brothers in Arms by Dire Straits.
Of all the places you have visited on your travels, which comes top of the list?
Gibraltar – “The Rock”. Not only was it my first foreign port call while serving in the Royal Navy but it is a fascinating place with a layered history tracing back hundreds of years. First impressions of the Rock rarely convey its merits or its place in history.
What food couldn’t you live without?
I will echo Margaret Thatcher’s Desert Island Discs choice – poached eggs on buttered Marmite toast.
What are you terrible at?
Hiding my feelings by adopting a “poker face”. I seem to recall Katherine Garrett-Cox, fund manager at Alliance Trust at the time (and whom I hold in the highest regard) telling me to “stop scowling John!” during the fund’s activist attacks.
What do you do for fun?
I’m a keen golfer and Formula One enthusiast.
