Christian Dargnat, the newly appointed president of the European fund association, Efama, has the look of a man with the weight of the world on his shoulders.
Despite our interview taking place in sunny Monaco – not more than a short walk from Monte Carlo bay – the 47-year-old, who also doubles as chief executive of BNP Paribas Asset Management, cuts a rather forlorn-looking figure.
One suspects, however, that it is not his forthcoming work with Efama that has taken the colour out of the cheeks of the highly regarded chief executive, but BNP Paribas’ closely guarded plans to overhaul its fund business – plans Mr Dargnat has given me strict instructions not to ask him about.
“I cannot talk about any restructuring,” he tells me over coffee. “That topic will have to wait for another day when I promise you we can spend many hours discussing it. Today I implore you that we talk about something else – in particular my new role with Efama.”
The “restructuring” Mr Dargnat refers to centres on the French investment house’s wish to be more reactive to client demand. This desire will reportedly see BNP Paribas’ network of fund companies remoulded under three pillars comprising a retail division, an institutional arm and an emerging markets unit.
For some, such a reorganisation – which has involved lengthy negotiations with the unions – is long overdue. BNP Paribas Investment Partners, the umbrella company under which all of the French house’s fund units reside, lagged behind its rival French peers in terms of asset flows during the first quarter of this year. Figures from Morningstar, the data provider, show that investors pulled roughly €6.8bn from its funds last year – an unwanted achievement that saw BNP Paribas IP top a list of the worst-hit fund companies in terms of outflows for 2012.
“If I was not concerned by this I would be blind,” says Mr Dargnat, who as a 20-year-old competed in the French Olympic trials for the marathon.
“That’s why we want to address this with short-term action and, more importantly, longer-term change. What those changes are, however, I’m not able or willing to discuss right now.”
I take my cue and ask Mr Dargnat what he hopes to achieve during his two-year spell as president of Efama. Mr Dargnat, who was previously Efama’s number two, succeeded Claude Kremer in June. Mr Kremer, a lawyer who has also served as chairman of the Association of the Luxembourg Fund Industry, had been the trade group’s president since 2011.
“I want to show that asset managers are the good guys and that we’re good for the global economy,” he says.
“We’re long-term investors, not bankers chasing short-term gains and we need to get that message across to the man on the street. Right now the world needs growth, and if you want to grow you need to invest. But if you want to invest you need capital, and to have capital you need savings. Bingo – here we are with those savings. We are here to help the economy find itself.”
Convincing investors of that “good guy” image will not be an easy task, however. In recent months a number of fund managers have been arrested for alleged insider trading – the most recent being a former star manager at BlackRock, the world’s largest investment house.
Mark Lyttleton, 41, and a 37-year-old female relative, reported to be his wife, were detained on April 30 and questioned by the UK’s Financial Conduct Authority and the City of London Police. Both were released without being charged.
Those arrests came less than three months after Schroders was forced to issue a statement that one of its employees had also been arrested in connection with alleged market abuse and insider dealing, although Schroders said the allegations related “entirely to this individual’s personal actions”.
“If you look back over the years you will of course find such examples of people misbehaving, but they are not so numerous,” Mr Dargnat points out. “I would say it’s less than 1 per cent of people who are not doing their job properly – leaving very many people who are.
“But of course we need to act responsibly and take care of our clients, because if we don’t those clients will simply disappear. The clients are vital to our survival and we need to be trusted by them. I’m not managing my money, I’m managing theirs and as an industry we need to remember that.”
With the colour returning to Mr Dargnat’s cheeks, the chief executive is also keen to talk about what he sees as the over-regulation of the fund market – a longstanding concern of the fund association.
“Of course we need regulation. If you have no regulation then you just have jungle law and nobody wants that. But today my biggest fear is that we have a situation of regulatory fatigue.
“We had two Ucits directives, for example, over a period of 20 years, but have since then had a further three in less than five years. Does that make sense? I don’t think so, and so what I’m saying to regulators is that we need to take a break and have an impact assessment of what has been decided on during the past five years.
“The regulators have decided to change the rules of the game. That’s fine. But now let’s take a breath and see what those changes mean,” says Mr Dargnat, who knows more than most that life is a marathon rather than a sprint.