T. Rowe Price Names New CEO But Reaffirms Priorities

The T. Rowe Price Group has announced that Bill Stromberg, chair of the company’s board of directors and its chief executive officer (CEO), will retire from his roles on December 31.

According to the firm, Stromberg will continue to serve on the board as nonexecutive chair, and he will be succeeded as CEO by Rob Sharps, T. Rowe Price’s current president, head of investments and group chief investment officer (CIO).

In a conference call held to discuss this development, Stromberg said the naming of Sharps as the firm’s next CEO has been a multiyear process. During the call, both Stromberg and Sharps emphasized that the succession plan does not represent a change in direction for the firm—but rather a continuation of its outstanding strategic priorities.

In the retirement plan arena, Stromberg and Sharps said T. Rowe Price remains committed to transforming its full-service retirement recordkeeping business by expanding its 30-year relationship with FIS, a financial technology provider that serves some of the industry’s largest recordkeepers. Once the transformation is complete, they explained, FIS will assume responsibility for managing retirement technology development and core operations. As a result, about 800 T. Rowe Price operations and technology associates are being offered the same roles with FIS that they have today, with the transition effective August 1. After the transformation, T. Rowe Price will maintain its responsibilities for delivering investment management, high-touch client service and personalized participant experiences.

Another key ongoing project that will be stewarded by Sharps after Stromberg’s departure is the creation and division of a new entity that will operate as T. Rowe Price Investment Management. T. Rowe Price is carving out the new asset management business to help the $1.3 trillion asset manager maintain and expand its exposure to many of the small and midsized companies that populate its portfolios.

“I look forward to driving forward the strategic agenda that we recently laid out in an earnings call,” Sharps said. “Not only does this include the launch of T. Rowe Price Investment Management, but it also includes the broadening and deepening of our ESG [environmental, social and governance] investing capabilities, transforming the retirement plan services business through the recently announced partnership with FIS, continuing to evolve our target-date offerings, and ensuring diversity, equity and inclusion remains a strategic focus for our business.”

Regarding the carveout of T. Rowe Price Investment Management, Sharps said, the firm has made strong progress and remains on track for formal separation during 2022.

Beyond Stromberg’s pending retirement, T. Rowe Price also announced that Céline Dufétel, chief operating officer (COO), chief financial officer (CFO), and treasurer, will be stepping down from her roles, effective July 31, to assume a leadership position with a fintech company. She will serve in an advisory role with T. Rowe Price until August 31.

As such, Jen Dardis, currently head of finance, will become CFO and treasurer and join the management committee, effective August 1. Dufétel’s COO responsibilities will transition on an interim basis to Robert Higginbotham, a member of the firm’s management committee and head of global distribution who also has oversight responsibility for the global product group.

Commenting on the prospect that T. Rowe Price could engage in merger and acquisition (M&A) activity in the near term, Stromberg and Sharps left the door open to the possibility, though both also said the focus remains on organic growth and building new internal capabilities to deploy to the marketplace.