Baillie Gifford continues to respond sensibly to setbacks and remains long-term, earning an Above Average Parent rating.
Best known as an aggressive-growth equity manager that benefited from early bets on high-growth tech stocks, Baillie Gifford endured large and correlated drawdowns in 2022. This affected many of its funds, denting some track records and prompting outflows and, for the first time in the firm’s history, layoffs in 2024. Then, in 2026, it introduced a voluntary redundancy scheme, expected to mainly affect supporting staff. We have seen similar action at some peers. Elsewhere, Baillie Gifford has continued to rationalize its fund lineup, closing funds such as the US Alpha, US Discovery, and Sterling Aggregate funds. It has also converted many of its US-domiciled mutual funds into exchange-traded funds in response to the change in distribution preferences there.
Some senior personnel have retired in the past five years, including CEO Andrew Telfer, who stepped back in March 2025. The firm is now led by CEO Tim Campbell, alongside two other managing partners and the rest of the partnership. As with most staff transitions at this firm, the change was well-executed and well-telegraphed in advance, which we like.
The firm managed around GBP 180 billion in assets under management as of March 2026, compared with GBP 230 billion two years before. It passes on economies of scale and demonstrates sound capacity management. Equities account for 96% of AUM. The firm boasts some loyal institutional clients comprising roughly 75% of AUM, mostly in segregated accounts. Outflows have proved persistent in recent years. For some investment strategies, investors may have lost patience owing to elevated volatility and underperformance, but there are pockets of strength. We do not think the firm is in structural decline, for now.
Indeed, there is still much to like, including the partnership structure. Many at the firm, including many of the 50-plus partners, spend their entire careers at Baillie Gifford. Staff turnover is typically low, and the partnership is a strong retention tool at current assets. The distinctive investment culture persists, including its graduate program through which many now-veteran investors joined. Risk management is investment-led and thoughtful. We like the fact that it has more influence now than prior to the 2022 drawdowns.
Note: This share class' Parent Pillar rating is analyst-driven, as its Branding Name, Baillie Gifford (Branding Name ID: BN0000083U), is covered by Morningstar Manager Research.
United States