Bhide’s concerns were such that he reported Scottish Mortgage to the Financial Conduct Authority.
In a statement to FTAdviser,a spokesperson for the trust’s board said they considered themselves as having adequate investment experience, and cited the professional careers of outgoing chair Fiona McBain and senior independent director Justin Dowley.
In the trust’s favour, the performance of Scottish Mortgage Investment Trust remains strong when viewed on a five year time horizon, returning 52 per cent over the past five years, compared with 21 per cent for the AIC global peer group in the same time period.
But over the past year the trust has lost 38 per cent in share price terms, compared with a loss of 10 per cent for the peer group. (See chart.)
In addition to his role as joint manager at Scottish Mortgage, Slater is also head of the US equity team at Baillie Gifford, a desk that is responsible for managing tens of billions of pounds of client assets across multiple portfolios.
At the time he was made head of the US equity desk, a role which carries a seven-figure salary, Baillie Gifford said it had scoured the world to find someone for the job, prior to settling on Slater as the best candidate.
This is relevant because another of Bhide’s criticisms revolves around the level of resource he feels needs to be deployed by those seeking to invest in relatively early-stage and unquoted companies.
He feels that by choosing to invest in this space, the trust is effectively competing against US venture capital funds with infinitely more resources.
In a statement to FTAdviser on how much of his time Slater can devote to Scottish Mortgage, a representative of Baillie Gifford said: “The vast majority of Tom’s time is focused on researching stocks that are either current holdings within the Scottish Mortgage portfolio or potential candidates for the portfolio.
“There is a very high degree of natural overlap with his US equity responsibilities. The US desk is very well resourced. It includes two other Baillie Gifford partners and a number of other senior investors, so the management responsibilities for the US desk are shared broadly — they do not all fall to Tom.”
Data from FE Analytics shows that 51 per cent of Scottish Mortgage’s holdings as of March 30 2023 are in US-listed entities.
