TRUST & ESTATE PLANNING

5 Questions with Gene Todd: Investing Patiently and Embracing Diversity

02.25.2021

Gene Todd is Executive Vice President at Fiduciary Trust International where he oversees all aspects of business development and serves as Regional Managing Director of our Northern California market. Gene joined the firm in January of 2020 after holding senior leadership positions at firms specializing in mergers and acquisitions, venture capital, leveraged buyouts, private equity, and wealth management.

Here, Gene shares some of the insights he has gathered over the course of his 25-year career as a financial professional—including his best advice about investing, working with a wealth advisor, and promoting diversity, equity, and inclusion in corporate America.

1: What are the most important things you have learned about wealth during your career?

GENE: Number one, I've learned that market-timing is extremely difficult. Being a long-term investor is how you achieve success. I’m a proponent of using behavioral finance as a tool for long-term investment success. It’s all about preventing investors from making irrational decisions like selling when they are fearful. We all know you should buy low and sell high. But, unfortunately, many people do the opposite. 

In a previous position, every time I signed on a new client I handed them a brick and said to them: “There will come a time when you feel like picking up this brick and throwing it through the window of my house. When that happens, flip it over.” On the bottom of the brick was a blank check. Then I’d say: “Whenever you feel like that, make sure you find all the capital you have available and write a check, because that's the time when you should be buying.”

2: What is your general impression of Fiduciary Trust International after your first year here?

GENE: I’m so proud of how we care for our clients. We are their biggest advocates. We know that we are in the relationship business. Our clients want to work with people they know, like and trust—and that is our ultimate differentiator. It's not just about providing exceptional wealth management capabilities like investment management and estate planning services such as trusts. Those are important, but clients really want to know what motivates us. Why are we in this business? They are looking for ways to connect with us. Our firm does a really great job of articulating our purpose from the inside out.

3: February is Black History month. What advice would you give young Black investors?

GENE: Most wealth in this country is intergenerational, passed down from prior generations. It's not from someone making it big and spending it all. Financial empowerment starts with saving more, investing more, teaching our children and grandchildren great financial habits, and passing wealth on. The stock market is one of the most efficient ways to do that. If we’re going to close the wealth gap in America, we have to save, invest, and pass it on. Then the wealth divide will slowly start to erode.

4: What is Fiduciary Trust International doing to create a more inclusive work environment?

GENE: One of the things we’re doing differently is broadening our approach to recruiting—how and where we find the best talent in the business. For example, I’m currently searching for senior business development professionals to join my team in northern California. The pool of candidates is diverse, both racially and in many other ways. At the corporate level, we’re taking the same approach to the internships we will be offering to college students this summer.

Our parent company, Franklin Templeton, also has several networking groups for employees with common interests and backgrounds. The Black Empowerment Network helped organize a series of events to celebrate Black History Month.

5: How can investors encourage publicly owned companies to become more diverse?

GENE: A very disappointing fact is that the number of Black CEOs at Fortune 500 companies is at its lowest level in over 20 years. Currently, there are only five, and two are slated to retire before the end of June, leaving only three. Unfortunately, there is no quick fix for this problem given the number of years it takes to groom someone for the C-suite (i.e., CEO, CFO, and COO).

A major source of the problem is that there is a shortage of Black professionals who are on the management track early in their careers. I think one of the practices large companies should get back to is offering the executive development programs for Black employees that were so common in the 70s and early 80s. Junior executives were assigned to a variety of business groups and departments on a rotating basis because they were being groomed for senior management positions. And 15 or 20 years later, lo and behold, a number of these employees ascended to the ranks of the C-suite. There was a direct correlation between these programs and diversity among the senior leadership of the firm.

After a year of toxic inequality events ranging from George Floyd’s murder to the pandemic, we are at the proverbial “make or break moment” for business and society. I hope individual investors begin to hold public companies accountable for significantly increasing the ranks of women and minority groups. A public company should look more like America—from its board of directors to its C-suite executives, management team and overall workforce.

Our portfolio managers share this view. They know workforce diversity is a common trait among companies that are conscientious, competitive, and more likely than others to succeed. If investors focused on these factors, and shareholders voted their proxies based on how diverse a company was, senior management would have another incentive to promote diversity.

I’m proud to say that women are well-represented at the highest levels of Fiduciary Trust International—including our chair, Gail Cohen, and vice chair, Dr. Lisette Cooper. Lisette is the founder of Athena Capital, which we acquired recently, and a vocal supporter of shareholder activism to promote equality and diversity in the workplace. Of the six people on our executive committee, two are women and one is an African American male (that would be me).

So, we’re making progress in this area. But, like most companies, we can do better—especially if we aim for racial diversity the same way we have advocated for gender diversity over the years.

 




This communication is intended solely to provide general information. The information and opinions may change without notice. The information and opinions do not represent a complete analysis of every material fact. Statements of fact have been obtained from sources deemed reliable, but no representation is made as to their completeness or accuracy. The opinions expressed are not intended as individual investment, tax or estate planning advice or as a recommendation of any particular security, strategy or investment product. Please consult your personal advisor to determine whether this information may be appropriate for you. This information is provided solely for insight into our general management philosophy and process. Historical performance does not guarantee future results and results may differ over future time periods.

IRS Circular 230 Notice: Pursuant to relevant U.S. Treasury regulations, we inform you that any tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. You should seek advice based on your particular circumstances from your tax advisor.

 

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