After much speculation, Fidelity Investments announced that its president, Rodger A. Lawson, will retire at the end of the quarter after two-and-one-half years on the job.

The big question now is who, or if, anyone will replace him?
 
“I think the issue will have to be worked out whether or not his position will be filled,” said Geoffrey Bobroff of Bobroff Consulting in East Greenwich, R.I. “Fidelity has functioned without his position in the past. Lawson has brought in talent and talent has been promoted during his tenure and one would assume the company could function quite nicely with that talent in place without filling his job.”
 
Edward C. Johnson 3rd, 79, remains chief executive officer and chairman of the Boston-based fund company, a position he has held since 1977. Speculation has been swirling about who will replace Johnson when the time comes, with his daughter, Abigail Johnson, the most likely contender.

Lawson, 63, wrote in a letter sent to employees Wednesday afternoon that he will remain an advisor to the company and Johnson. “Effective at the end of the first quarter, I plan to retire as Fidelity's president. I will, however, remain a Fidelity employee and continue to be active as an advisor to the chairman, the Board and the management team on an ongoing basis,” Lawson said. “Leadership of Fidelity remains in the hands of our chairman and the senior executive team.”

Lawson’s departure has been widely rumored for some time. He stayed with Fidelity through the financial catastrophe of the last few years, which took a bite out of the company and the industry’s profits. Layoffs and cutbacks were the name of the game under Lawson’s leadership.

At the same time, Lawson has been credited with vastly improving performance at Fidelity, which has $1.2 trillion in assets under management. On an asset-weighted basis, Fidelity's mutual funds are now outperforming 74% of their peers, with equity funds beating 66% of the competition. A year ago, Fidelity's funds were ahead of 56% of their peers overall and only 36% of equity funds.

Only time will tell whether the Fidelity that will emerge after Lawson’s departure will look anything like the Fidelity of today. “Will Edward Johnson leave the firm? Will Abigail Johnson ascend? Unfortunately we can all sit here and guesstimate, but nobody has any insight into what Fidelity may or may not choose to do,” Bobroff said. “The bottom line is I don’t think Lawson’s departure forces Edward Johnson to make those types of decisions right now.”