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A modest structure on Federal Street, in Boston's financial district, is the headquarters of one of the world's most successful international fixed-income investors, and also one of the lowest profile. The global bond group of Scudder, Stevens & Clark traditionally eschews media exposure, preferring to let its performance speak for itself. This culture of understatement extends to the building itself. In sharp contrast to the offices of the brokers who compete for Scudder's business, the Boston HQ is a spartan and unremarkable place. In fact, the investment banking ethos is not welcome. One employee confides, "you don't get on here if you're an investment banker type--you know-aggressive and brusque; in fact you don't last."
One quirk: no food is consumed anywhere in the building as if this would be a vulgar distraction from the serious business of managing the firm's more than US$56 billion.
EMPHASIS ON SPECIALIZATION
Much of the Scudder image has been inherited from the firm's origins. Originally based just in Boston, the firm was set up by Theodore Scudder in 1919 along with Haven Clark. It has evolved over the last 74 years from a partnership into a privately held corporation which is owned by about 100 directors and junior directors, who are known as principals during their first few years of service.
The firm has a long pedigree in fixed-income investing. It was an early practitioner of active bond management, involved in the field for nearly 60 years. Today Scudder's fixed-income group invests in 1G markets and uses the most sophisticated quantitative and qualitative methods and instruments to maintain performance. This record has been impressive. Its International Bond Fund was the first bond fund to receive Morningstar's top, five-star rating.
THE GLOBAL BOND GROUP
Throughout the organizational structure of the global bond group, there is notable lack of hierarchy and an emphasis on specialization. The architect of the division is Lynn Birdsong, a softly-spoken man in his 40s with a background in fixed-income portfolio management which stretches back about 20 years. Birdsong, director of the global bond group, is an advocate of strategic rather than tactical management and presides over the group using three policy committees, although individual product managers have responsibilities for their own portfolios.
The first sets a broad...