The new President and CEO of Toronto-based FundSERV Inc. intends to strengthen the firm’s involvement with fund companies and distributors, which has been a key element in its growth strategy.

“That’s one of the real things FundSERV has done — kept the [communities] aligned so they are able to work things through as an industry,” says Brian Gore, who took on the top job in September.

Gore will increase his awareness of industry needs by contacting a broader range of executives and operational individuals at both fund companies and the distributors.

“We want to make sure we are an industry able to keep moving forward,” says Gore. “Are there going to be any changes from a manufacturer or a distributor perspective? I want to make sure we understand these needs.”

Industry involvement has always been a huge part of FundSERV’s business. A number of committees are already in place, with members coming from various fund companies and distributors. These provide a means for industry groups to work together and address problems that arise.

Gore has 10 years experience with FundSERV, an online network that allows fund companies and distributors to interact quickly and efficiently.

“In the future we want to make sure we continue to increase the value of what we deliver to our customers,” says the new CEO.

Gore takes over from former FundSERV president and CEO Alan Hutton, who announced his retirement earlier this year. Hutton was appointed as president and CEO in 2001 and has been a member of the FundSERV board since 1988. He’ll remain at FundSERV until Nov. 30 to ensure a smooth transition.

“FundSERV provides a trusted and respected value-added network to the Canadian investment fund industry” says Hutton. “Over the past six years I’ve enjoyed the challenge of extending our reach, reducing both internal and external costs, increasing our functionality and mitigating many operational risks.”

Gore says that Hutton had a huge impact on the company’s corporate governance. Previously, the board of directors had become involved with day-to-day operational decision making, while already having full-time executive positions at other companies.

“They had become very involved with the operation of FundSERV more than they should have,” says Gore. When Hutton came on board he was able to turn things around and take over some of the operations, allowing the board more time to actively perform directorial duties.

“We’re going to continue down that path and that is very much what I want to do and ensure that FundSERV is seen as an industry service provider not just a network,” says Gore.

He also wants to make sure that FundSERV remains operating effectively. “The mantra we’re using now is operational excellence — that everything operates 24/7.”

Gore is not the new kid on the block. He has been a member of FundSERV’s board since 1997, and served as chairman from 2000 to 2003. He has been involved with the mutual fund industry for more than 20 years. Prior to his appointment, he was director of Toronto-based Citigroup Corporate and Investment Banking.

Gore started in the mutual fund industry in 1988 on the technology side of the business when Toronto-based AGF Ltd. hired him to develop a system that would bring administration in house. Previously, administrative functions were handled by another firm and service levels were significantly lower than they should have been.

Before FundSERV, there wasn’t a common administration network for companies to use; as a result, some companies, such as AGF, created their own networks for access with fund companies.

“Part of that process was to create a network for distributors to be able to access the fund company data in their offices right across Canada,” says Gore. “You could argue that the network was very FundSERV-like, although it was only with one fund company.”

At the same time, Gore became the chairman of an electronics standard committee, a subgroup of the Financial Administrators Section (part of Toronto-based Investment Dealers Association of Canada). This group approached fund companies and let them know that it was time for change.

“The fund companies were told that they couldn’t all be going off and doing their own thing,” says Gore. “We needed some standards in the industry. The fund companies had to get together and work out how they were going to do this as a team.

@page_break@“There was a point when there were three different networks out there at the same time and somebody came along and said we can’t just keep creating more networks, we need some standards to go by,” says Gore.

That mechanism wouldn’t come about until 1993, when FundSERV was created. It would become the standard network to be used by most in the industry.

It provides networks and workflow management to the Canadian investment industry and facilitates interactions between investment fund manufacturers and distributors.

The web-based services and applications support order placement, confirmation, payment and reconciliation for more than 20,000 investment fund instruments and a customer base of about 725 organizations, including fund manufacturers, distributors and their intermediaries.

Almost all mutual fund transactions go through FundSERV, with the exception of bank placed trades at the same bank, and a few paper-based funds sold at life insurance carriers.

After FundSERV proved it could deliver the level of service that the industry needed, companies started to sign on; they realized that business development would be hampered if each company had its own network.

“Some companies thought they could do it cheaper and better but in the end in order to do business effectively in this industry you have all have to be rowing in the same direction,” says Gore.

With FundSERV in place, the industry expanded from a $40 billion industry into a $700 billion industry and Gore believes that FundSERV has a lot to do with the growth.

“I don’t think the industry could have grown at the pace it did if it wasn’t easy to do business,” he says. “The only reason for it being easy to do business with any investment fund industry has been because of the standards and FundSERV.”

Hutton says Gore is an excellent choice to lead the company into the next phase of its development.

“Under Brian’s leadership, our customers will continue to enjoy the high level of service and the high level of confidence that they require and deserve,” says Hutton. “Brian is well known and well respected throughout the industry and brings an excellent operational and customer care perspective to the business.” IE