Management Shakeup at Fidelity Impairing Recruiting

With Fidelity Chairman and CEO Edward “Ned” Johnson remaining quiet about who is next in line to take over when the 77-year-old finally retires, industry watchers say his deafening silence is hurting the company’s ability to recruit top talent, Fortune reports.

And this year’s departure of a number of key executives and the hiring of a new president rather than the promotion of brokerage chief Ellyn McColgan is adding to the mystery.

In January, Steve Jonas, head of the mutual funds division, left; followed by Chief Operating Officer Bob Reynolds in April; Fidelity Retirement Services President Jeff Carney, EVP Michael Sternklar and 401(k) salesman Bill McDermott in July; and McColgan in August, a day after the arrival of new President Rodger Lawson.

“We’re talking to people who we could never get out of Fidelity,” said a recruiter speaking on anonymity. “Now they’re desperate to get out because there’s no end in sight to the inconsistency of leadership.”

As one industry executive who was approached by Fidelity’s search firm put it, “Why would I go there, not knowing who’s in charge?”