Franklin Templeton CEO Jenny Johnson on AI, Private Markets, and the Hidden Risks in Index Funds

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Matt Zeigler (0:47)

You're watching Excess Returns, the channel that makes complex investing ideas simple enough to actually use or better questions lead to better decisions. I'm Matt Zeigler, and my guest today is the CEO of Franklin Templeton Investments, Jenny Johnson. Welcome to Excess Returns.

Jenny Johnson (1:03)

Thanks for having me.

Matt Zeigler (1:06)

We're going to get in to the horse on the wall behind you in a second, because how can I not since it's just me? But I mean, before I ask that question, three decades in the industry, 1.7 trillion in assets, I can only imagine that sometimes a Tuesday feels like three decades in your seat. My goal is for this conversation not to feel like three decades for you.

But man, take me there, like a day in the life, how much has happened? How much have you been responsible for already today in the late afternoon here on a Tuesday?

Jenny Johnson (1:39)

Well, here's the good news.

When you become the CEO, I always call it my four P's that are what you need, people, passion, purpose and persistence. The number one job as a CEO is actually putting together the right team that can work together and accomplish things. So the good news is I got a great team. And so the secret is they do a lot of the work, right? And then, yeah.

And then passion, you know, I always say like, you got to love what you do because you spend a lot of time doing it. I mean, we're a global company. I spent a lot of time traveling all over the world. There isn't a week that goes by that I'm not on the road. And I spent a lot of weekends traveling because when you go to Asia, Middle East, Europe, other places like that, you end up sort of spending your weekend. So you got to love what you do. And then I say, you know, I think as a CEO, your job is to describe it in a purposeful way, such that people can get excited. You want your employees excited to feel good about what they do, to come into work and to be fired up. And I think it's really important that you describe that, you know, in a purposeful way. And what do we do? We help people achieve their most important milestones of their lives. Usually, it takes a financial component. And honestly, Matt, which I think is often underappreciated, is the fact that people's retirement savings are investing in companies that are creating innovations that are ultimately improving all of our lives. Like that mechanism on both sides is really, really important. That's a real purposeful way to think about kind of the business that we're in. And finally, persistence, because you're going to have a lot of bad days. And a lot of times, it's just about dusting yourself off and getting back on the horse.

Matt Zeigler (3:27)

Okay. Well, fifth P, is this Phoenix the horse behind you?

Jenny Johnson (3:31)

This is Phoenix the horse. Yes. There we go.

Matt Zeigler (3:34)

Fifth P. There we go. And that's important too, right?

Jenny Johnson (3:38)

Absolutely.

Matt Zeigler (3:39)

All right. One of my favorite things, one of the reasons I wanted to have this conversation is you truly went intern all the way to CEO.

Jenny Johnson (3:48)

Yeah. Yes.

Matt Zeigler (3:50)

So I could get us lost in this story. I won't for sake of the audience. Yes. Hold on. I'm going to try to get her to do that later. But for sake of this, like intern to CEO, what do you tell an intern? What do you tell a young person today? How much of your experiences maps back versus not at all?

Jenny Johnson (4:08)

To me, every job that I went into, I did it with full enthusiasm to really understand what it was.