Ueland Pushed Out at Russell in Executive Shakeup

A Russell news release said the company’s board will conduct a search for a replacement to succeed Schlifske, who Russell said is expected to return to parent company Northwestern Mutual, where he is executive vice president. Michael Phillips remains as Russell’s board chairman, the company said.

“We are fortunate to have someone of John’s seniority taking on this role, which clearly demonstrates the support of Northwestern Mutual to lead our future success,” Phillips said in a statement. “I and the board have complete confidence in his ability and that of the Russell leadership team.”

The company said Schlifske most recently was responsible for all aspects of Northwestern Mutual’s investment products and services business, including annuities, mutual funds, advisory products, and the Northwestern Mutual Wealth Management Company. As part of these responsibilities, Schlifske also served as CEO of Northwestern Mutual Investment Services, Northwestern Mutual’s broker/dealer. Northwestern acquired Russell in 1999.

In the Russell statement, Phillips acknowledged Ueland’s contributions since being named president in July 2003 and CEO in January 2004. “Craig has made an extensive contribution to Russell throughout his 25 years at the company, culminating in his leadership the past five years,’ Phillips said. “Craig successfully melded his expertise and his deep affection for Russell and its purpose in order to drive growth and position the firm to compete in the global financial services landscape of the future. We wish him well as he moves on.”

Departure Not Voluntary

Ueland’s departure, which was not voluntary, indicates two important phenomena at the company, officials there say.

First, Northwestern, which has been almost entirely hands-off since it made the Russell acquisition, is going to be more intimately involved, even beyond the actual tenure of Schlifske at Russell, which is expected to be brief as he is the heir apparent at Northwestern. Second, while Ueland had clearly made his share of foes in Tacoma (there has been substantial turnover at a senior level within the firm the past two years), he would have survived the turmoil if the basic Russell manager-of-managers business was in better shape.

Ueland had championed the firm’s move from Tacoma to Seattle that was known to have upset Phillips, among others.

The real challenge for Schlifske, sources say, is to capitalize on Russell’s extraordinary brand and footprint in the institutional investment space in a fast-changing investment environment, which is what Ueland failed to do.

With nearly $213 billion in assets under management as of March 31, Russell serves individual, institutional, and adviser clients in more than 40 countries.