ETF Movers & Shakers: Mark Makepeace

CEO of FTSE Russell sits atop an indexing juggernaut.

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Reviewed by: Heather Bell
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Edited by: Heather Bell

[This is part of an 11-part series we will be publishing each weekday until it is complete. The ETF Movers & Shakers feature appears in the March edition of ETF Report: Previously published: Jeffrey Gundlach; Michael Crinieri; Reggie Browne; Nadig & Balchunas]

Movers and Shakers

Mark Makepeace

Mark Makepeace heads up what is now, indisputably, an indexing juggernaut. Last year, FTSE's owner, the London Stock Exchange Group, acquired Russell Investments for its index operations and announced the sale of Russell's asset management business to TA Associates. The resulting index company, FTSE Russell, is the melding of two iconic benchmark providers.

And Makepeace has been there as CEO of FTSE since its inception, founding the index provider in 1995 as a 50/50 partnership between the London Stock Exchange and the Financial Times. (The LSE eventually bought out FT's share.)

In that time, he's seen it grow from a firm with a staff of nine into a major player in the index space with more than 500 employees and some $10 trillion benchmarked to its products worldwide.

FTSE started out providing U.K. market with domestic and international equity benchmarks as well as U.K. government bond indexes, but Makepeace says the company's ambition was always global expansion. That it achieved—first into Continental Europe, then into Asia and finally into the U.S. FTSE established its first U.S. office some years ago, but the Russell acquisition gives the company a serious foothold in the market.

"It gave us the most widely used U.S. benchmarks for institutional investors," Makepeace noted. "The Russell indexes have a fantastic track record and a very, very loyal client base."

The combination of FTSE's international strength with Russell's core audience in the U.S. makes FTSE Russell a truly global index provider, Makepeace adds.

But when you get right down to it, the acquisition of the Russell indexes is really just par for the course for FTSE. It has a long history of expanding through partnership, and after all, that's how it got its start with the LSE and FT.

Looking to the future, Makepeace is focused first on finishing the integration and making sure that clients are well-serviced. FTSE Russell has 97 of the top 100 asset owners and 48 of the world's 50 largest plan sponsors as its clients, but now it's concentrating on expanding the services it provides to those customers.

In particular, Makepeace believes we're in an increasingly multi-asset world. FTSE has been expanding its activities in the bond market in recent years, and in 2013, it formed a joint venture with TMX called FTSE TMX Debt Capital Markets to expand its reach in the fixed-income space. This year, Makepeace says, it will roll out a new global bond index family.

"We see that as the path to providing benchmarks to that client base on a multi-asset basis. We don't see ourselves just residing in the equity world," he said.

But where do ETFs fit into all this? Makepeace sees them as playing a key role.

"I think it's a very important area because it's sort of the shop window," he said. "All the major fund managers, in the end, will be involved in some shape or form in the ETF market."

ETFs are where an index provider's core benchmarks tend to be "on show," Makepeace says. He notes that FTSE Russell, S&P Dow Jones Indices and MSCI all have roughly $3 trillion in AUM tied to their respective indexes, but at the moment, FTSE Russell is around No. 3 in ETFs. Filling that No. 1 spot in ETFs is the index provider's ambition ultimately.

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.