Edward Jones' new top exec is not a stran

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Nov 15, 2005 11:36 pm
Edward Jones' new top exec is not a stranger
By Jack Naudi
ST. LOUIS POST-DISPATCH
11/08/2005



In picking Jim Weddle to succeed Douglas Hill as the top executive at Edward Jones, a company search committee didn't look very far.

A 28-year veteran of the firm, Weddle, 52, is the consummate insider, overseeing the Des Peres stock brokerage's 9,000 branches. He also has been responsible for identifying brokers who can be moved into management positions.

Weddle, who takes over as managing partner Jan. 1, is a member of the firm's management committee and one of the five top-paid partners, earning more than $4.2 million last year.

He will replace Hill, who must step down as part of a settlement last December with the U.S. attorney's office over mutual fund trading irregularities. The firm paid a $75 million fine, more than $3 million of which came from Hill.

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In late summer, Edward Jones representatives approached Catherine Hanaway, U.S. attorney for the eastern district of Missouri, about letting Hill keep his job. She refused.

Hanaway was unavailable for comment Tuesday.

While Hill must resign as top executive, he will remain with the firm as a partner. Weddle said Hill's precise role has not been determined.

Hill was unavailable for comment.

Michael Harris, a professor of management and organizational management at the University of Missouri at St. Louis, said Edward Jones' 30,000 employees will look to Weddle for guidance.

"How important will good, ethical practices be?" Harris said. "If it's a lot of lip service, people will notice that."

The search for a replacement was conducted by an internal committee headed by Robert Virgil, a retired Edward Jones partner and a member of the management committee.

Virgil was out of town Tuesday and unavailable for comment.

Weddle said the search committee considered only insiders.

"Should an outsider have been brought in? I don't think so," he said. "The work of this firm, and the way we go about it, are very distinctive. We work only with individual investors. ... We're a partnership. I think there's an advantage to understanding and appreciating those things in the person that's going to be the managing partner."

Brokerage firms often recruit their top executives from outside the company, said Dirk Hackbarth, an assistant finance professor at Washington University's Olin School of Business. "They seek out competitors for their best managers and try to lure them away."

But Edward Jones, which caters largely to small investors, might be a different case, Hackbarth said. "The focus is so narrow, and there are not so many obvious competitors," he said. An insider, Hackbarth added, has a realistic perception of the company's future.

Harris said companies usually bring in outsiders "if they want to make a really radical change. An insider has a relationship. A history. There's a symbolic meaning to bringing in an outsider."

Weddle expects largely to stay the course, which means continuing to add branches in the United States, Canada and Great Britain.

"Our focus on the individual investor, our choice to compete via convenient locations and personal service, we think are very important and strategic advantages," Weddle said. "Those things are not going to change."

Edward Jones also has not changed the relationship with mutual fund companies that was at the center of its regulatory trouble. It long has accepted payments from seven "preferred" mutual fund companies; an eighth recently was added.

The payments are legal and common between brokerages and mutual fund companies, but the U.S. Securities and Exchange Commission and the U.S. attorney said Edward Jones failed to adequately disclose them to clients.

"The issues that have been addressed by the regulators have been well reported," Weddle said. "We have taken every step and put everything in place that we agreed to do."


====================

Jim Weddle

Age: 52

Current position: Partner at Edward Jones, responsible for branch administration

Position on Jan. 1: Managing partner, equivalent of chief executive

Years with firm: 28

First job at firm: In 1977, broker in Connersville, Ind., establishing firm's 200th branch at the time

Education: MBA from Washington University

Personal: Married, with three children; lives in Webster Groves

The quote: "Can (Edward Jones) continue to grow? Absolutely. There are so many individual investors out there that we are not doing business with."


 
Thought this was thought provoking
Nov 16, 2005 1:03 am
Edward Jones' new top exec is not a stranger
By Jack Naudi
ST. LOUIS POST-DISPATCH
11/08/2005




In picking Jim Weddle to succeed Douglas Hill as the top executive at Edward Jones, a company search committee didn't look very far.

A 28-year veteran of the firm, Weddle, 52, is the consummate insider, overseeing the Des Peres stock brokerage's 9,000 branches. He also has been responsible for identifying brokers who can be moved into management positions.

Weddle, who takes over as managing partner Jan. 1, is a member of the firm's management committee and one of the five top-paid partners, earning more than $4.2 million last year.

He will replace Hill, who must step down as part of a settlement last December with the U.S. attorney's office over mutual fund trading irregularities. The firm paid a $75 million fine, more than $3 million of which came from Hill.

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In late summer, Edward Jones representatives approached Catherine Hanaway, U.S. attorney for the eastern district of Missouri, about letting Hill keep his job. She refused.

Hanaway was unavailable for comment Tuesday.

While Hill must resign as top executive, he will remain with the firm as a partner. Weddle said Hill's precise role has not been determined.

Hill was unavailable for comment.

Michael Harris, a professor of management and organizational management at the University of Missouri at St. Louis, said Edward Jones' 30,000 employees will look to Weddle for guidance.

"How important will good, ethical practices be?" Harris said. "If it's a lot of lip service, people will notice that."

The search for a replacement was conducted by an internal committee headed by Robert Virgil, a retired Edward Jones partner and a member of the management committee.

Virgil was out of town Tuesday and unavailable for comment.

Weddle said the search committee considered only insiders.

"Should an outsider have been brought in? I don't think so," he said. "The work of this firm, and the way we go about it, are very distinctive. We work only with individual investors. ... We're a partnership. I think there's an advantage to understanding and appreciating those things in the person that's going to be the managing partner."

Brokerage firms often recruit their top executives from outside the company, said Dirk Hackbarth, an assistant finance professor at Washington University's Olin School of Business. "They seek out competitors for their best managers and try to lure them away."

But Edward Jones, which caters largely to small investors, might be a different case, Hackbarth said. "The focus is so narrow, and there are not so many obvious competitors," he said. An insider, Hackbarth added, has a realistic perception of the company's future.

Harris said companies usually bring in outsiders "if they want to make a really radical change. An insider has a relationship. A history. There's a symbolic meaning to bringing in an outsider."

Weddle expects largely to stay the course, which means continuing to add branches in the United States, Canada and Great Britain.

"Our focus on the individual investor, our choice to compete via convenient locations and personal service, we think are very important and strategic advantages," Weddle said. "Those things are not going to change."

Edward Jones also has not changed the relationship with mutual fund companies that was at the center of its regulatory trouble. It long has accepted payments from seven "preferred" mutual fund companies; an eighth recently was added.

The payments are legal and common between brokerages and mutual fund companies, but the U.S. Securities and Exchange Commission and the U.S. attorney said Edward Jones failed to adequately disclose them to clients.

"The issues that have been addressed by the regulators have been well reported," Weddle said. "We have taken every step and put everything in place that we agreed to do."


====================

Jim Weddle

Age: 52

Current position: Partner at Edward Jones, responsible for branch administration

Position on Jan. 1: Managing partner, equivalent of chief executive

Years with firm: 28

First job at firm: In 1977, broker in Connersville, Ind., establishing firm's 200th branch at the time

Education: MBA from Washington University

Personal: Married, with three children; lives in Webster Groves

The quote: "Can (Edward Jones) continue to grow? Absolutely. There are so many individual investors out there that we are not doing business with."

Got a little carried away with the font.  I thought the search was both internal and external.  At least thats what they told us while I worked there.  Some other interesting thing too.
Nov 18, 2005 7:24 pm

Has Anbody heard the claim there are too many Fiancial Advisors, in fact there is 33% more than is needed?  There is a major washout coming to the industry................


What does that mean to the 7 Eleven brokerage firm Edward Jones growth figures?