Fidelity Investments, the second-biggest U.S. mutual-fund company, named Abigail P. Johnson chief executive officer, succeeding her father Edward C. “Ned” Johnson III and becoming the industry’s most powerful woman.
“Abby will retain her role of President,” Ned Johnson, 84, said Monday in a letter to internal shareholders, adding that he will stay on as chairman of the board.
Fidelity signaled that Johnson, 52, was the clear successor to her father in 2012 when it named her president overseeing asset management, retail and institutional brokerage, retirement and benefits services. The appointment resolved the long-running question of succession at the family-controlled firm run by her father for more than three decades.
The younger Johnson, who started her full-time career at Fidelity in 1988, has worked in almost every major division at the Boston-based company. She was named head of the firm’s mutual-fund unit in 2001 and put in charge of Fidelity’s retirement business in 2005. In 2007, the company also gave her oversight of corporate-retirement services and fund sales to individuals.
Abigail Johnson has a net worth of $9.2 billion, according to the Bloomberg Billionaires Index.
Fidelity’s money-management business, which has lost ground to rivals in recent years, has about $2 trillion in assets. Clients pulled a net $1.1 billion from the unit in 2013. Ronald O’Hanley, who ran the business, stepped down earlier this year and was replaced by Charles Morrison, previously head of Fidelity’s fixed-income division.
Fidelity continues to shift focus to its record-keeping, retirement and brokerage businesses. As of June 30, the company had $4.9 trillion in assets under administration, which includes money it oversees as a record-keeper for retirement plans and for independent financial advisers and hedge funds. Fidelity is the largest record-keeper of 401(k) retirement assets in the U.S.
Fidelity, founded by Edward C. Johnson Jr. in 1946, was best known for decades as home to top stock pickers such as Gerald Tsai and Peter Lynch. Lynch ran the Magellan Fund for 13 years through 1990, returning an average of 29 percent annually.