Theresa Hamacher was named to her current position as president of NICSA (the National Investment Company Service Association) in March 2008. The worst crisis to hit the financial markets in U.S. history since the Great Depression soon unfolded.
Money Management Executive recently spoke to Hamacher about how she has helped steer the organization and its membership through the dark days of the crisis and into what Mohamed El-Erian, chief investment officer of PIMCO, coined in the aftermath of the crisis as the "new normal.''
What made you take the job?
I had worked in the industry on the investment side until 2001 as chief investment officer at Pioneer Investments. And then I had retired and was doing a lot of volunteer work. At the time NICSA was looking for a new president and the chair of the board (Peggy Schooley) said 'You know, this job is perfect for you.' It's a little bit investment and a little bit volunteer.' But it turned out she was right and I'm actually loving this job.
How does your background serve you in seeing through some of the issues that firms are facing?
I was a chief investment officer, so it was a lot more than just picking stocks and bonds. It was looking at the business of investing. And once you picked the stock or bond, there's still a lot of stuff that has to happen before you have something that's available to the investor. So now I'm looking at it more on the operations side in terms of how the operations area make the great ideas on the investment side available to investors.
The thing that was a big change for me was that I knew enough about operations to be really dangerous. But I got to follow up on a lot of stuff that I had a passing familiarity with. Now, I'm a lot more of an expert on things like omnibus accounting and the various technologies that support the transfer agency system.
Describe what it was like during your first few months as president of NICSA.
I, like everybody, was just a little bit open-mouthed. The downturn that we had was much more severe than anticipated. I expected to have more time to make a change but the market environment meant that we had to act very, very quickly.
Can you give us an example of how NICSA helped it members through the financial crisis?
One of the things that was speeded up because of the market environment was our transition to an online presence.
So we really were a meeting organization where people traveled to specific meetings. But when their budgets starting getting tight, that became very, very difficult to do. But they still wanted to be kept up-to-date and we would rather be able to do that using technology.
So the markets were down and people could no longer travel to meetings and the whole webinar technology became much more broadly accepted.
We still find that people feel that networking is important. But it's considered the culmination of a series of telephone and online contacts.
We had a newsletter, which MME was involved with for a long time, but we didn't have a big publication effort.
Which in a way has been good for us because the blog and social media has become our publication.
So we were able to skip a generation and we're really viewing the social media channels as a way to keep our members up to date with what's happening in the industry both with our own content and content that we've curated.
We have about 600 followers on Twitter. Our LinkedIn group is our biggest channel and that is 2,200.
Have you guys added or subtracted events since pre-2008?
Our conference attendance has been down. But we've scaled back on the number of conferences too in terms of consolidating events in Boston.
We have annual conferences in Florida in February and the general membership meeting, which is turning out to be our second biggest meeting, in Boston in the Fall. We're also running a bunch of regional meetings around the country. This seems to be the right balance for us.
Has your membership grown since you took over as president or has it stayed the same?
It's funny because if you look at the number of members, it's gone down. But that's largely due to the tremendous consolidation within the industry. In terms of the percentage of the industry that we cover, it's been high and remains very high. If you count the number of firms, our membership is around 180. But the number of individuals that we have in our database is 7,000-8,000.
We have international partnerships with The Association of the Luxembourg Funds Industry (ALFI) today. We help each other and we get a good view of trends in Europe from them. Regulatory trends from one side of the Atlantic ultimately find their way to the other side but in slightly different formats.
What are some of the larger operations issue that you guys are dealing with right now?
Omnibus accounting is an evolutionary change and everyone is still changing their business models to omnibus accounts.
The Foreign Account Tax Compliance Act is turning out to be a massive project that everyone is working on. Those are the two things that are top of mind for our audience today.
Other things like money market reforms are still swirling around in the back and eventually, should something happen there, that would have huge operations implications. But until you have a better picture of what that entails it's hard for the operations folks to focus on that.
Growth plans for NICSA?
A lot of our best practice discussions have been at the committee level and what we're doing more of is publishing those best practices discussions so you will be seeing more white papers from us.
The way we help firms save money is by communicating our best practices. There are a lot of interconnections in the operational world and an asset manager may use a whole series of service providers and maybe have some communication about the simplest way to do things.
A lot of people is committed to NICSA is because they have a forum for getting that information.