Fidelity Investments titan Edward C. "Ned" Johnson III dies at 91
Edward C. “Ned” Johnson III, a legendary figure in the mutual fund business who built Boston’s Fidelity Investments into a global giant, has died. He was 91.
Johnson, one of the region’s wealthiest individuals, ran the private company for four decades, taking over from his father and overseeing a vast period of growth in which Fidelity became the manager of retirement funds for millions of Americans.
“He was such a visionary as it related to investing, as it related to technology,” said Bob Reynolds, a former top executive at Fidelity who now runs Putnam Investments in Boston. “He was a legend that will never be forgotten by many, many, many people.”
Johnson was an innovator, who pioneered the concept of selling mutual funds directly to investors, through a toll-free phone line, instead of through brokers. He drove technology investments at Fidelity that put the firm at the forefront of online investing, phone apps and the like.
He was well-known as a hard-driving executive who obsessed over customer service and had high expectations for his employees – from star fund managers to those taking calls from investors. People who worked with him were drawn to his ambitious forward-thinking, as well as a willingness to listen and to push the envelope.
“He was a tough critic. He was ready to debate ideas and really thrash it out and really figure out what was the best way forward,” said Bob Pozen, a former vice chairman of Fidelity who is now a senior lecturer at the MIT Sloan School of Management.
When Pozen first interviewed at Fidelity for the position of general counsel, he said he asked Johnson what the job description was. Johnson replied: “Figure out what needs to be done and do it.”
Johnson’s exacting standards applied to himself back when he was a fund manager. And they applied to his daughter Abigail, whom he groomed for years to ultimately take the reins of the company. She became chief executive in 2014 and Ned Johnson remained chairman until two years later, when he was 86.
Fidelity’s business model has changed over time, as many investors shifted their money from funds run by professional stock pickers to lower-cost funds that automatically track major indexes. But the firm today manages more than $4 trillion of assets and employs more than 57,000 people around the world, including thousands in New England.
The billionaire Johnson was also a philanthropist, who quietly funded such institutions as the Museum of Fine Arts in Boston and the Peabody Essex Museum in Salem, among many other nonprofits.
Matthew Teitelbaum, director of the Museum of Fine Arts, called Johnson a “brilliant strategist,” who has left a lasting mark on the museum.
“His passion for art, his passion for his city has changed us forever,” Teitelbaum said.
Johnson was a man of many interests – from Japanese culture and helicopter skiing to growing the perfect tomato. Fidelity has made major investments in Boston real estate, including building a hotel in the Seaport when few businesses had yet moved there. Johnson also created BostonCoach, a limousine and black-car service, after waiting too long for a taxi to the airport; he sold that business in 2013.
The Milton native rarely granted interviews and largely avoided news conferences. His daughter and successor Abigail said in a Linkedin post Thursday that he died at home in Florida, surrounded by family.
“He loved his family, his coworkers, work, the stock market, art and antiquities, tennis, skiing, sailing, history, and a good debate,” she wrote in the post. “He could be counted on to have the contrarian view on just about anything.”
In a video tribute to Johnson on its homepage, former Magellan Fund manager Peter Lynch said getting a call to meet the man who would be his boss was like getting a call to meet Elvis.
“You know he didn’t suffer fools lightly,” Contrafund manager Will Danoff said in the video. “He was not afraid to suggest that you reconsider your position.”
The cause of death was not released. In addition to Abigail, Johnson is survived by his wife, Elizabeth B. (Lillie) Johnson, his daughter Elizabeth, son, Edward, and seven grandchildren.
This article was originally published on WBUR.org.
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