Mr. Williams would like to hire about six product specialists based in Hong Kong and London toward the end of this year, to focus on winning business in Asia. The firm already has nine staff members working on this region.
At a strategy meeting last month, Mr. Williams and his team ruled out joint ventures in the short term because local restrictions on investment and the limited size of the Asian market mean the firm would not get an instant benefit from any formal collaboration.
"With an open market like the U.K. or Europe, a joint venture would have the prospect of asset gathering in the short term. In India or China, we would do it to be seen to have a commitment to the country in the hope that we would get some assets. At the moment, the risk-return trade-off does not look right," he said.
"One of our concerns is that we run the risk of transferring our edge, our intellectual capital, and that is something we want to protect against," he added.
But he sees a rich seam of largely untapped institutional funds in this region, with around 30 institutions, including central banks and government-owned organizations controlling $1.3 trillion in assets. (As of Dec. 31, BGI had $1.07 trillion in total assets under management, according to the P&I/Watson Wyatt World 500 survey of the largest money managers.)
"We are in discussions with several parties at the moment with large assets, who have the capability to award mandates of $1 billion to $5 billion. That's what makes Asia interesting," he said. He would not identify any of the firm's prospects.
But he views the region as a long-term bet until individual countries such as China ease operating restrictions for foreign money managers.
"My chances of increasing profits and generating revenues are greater in France at the moment. But over the long term there should be no comparison between the size of the business in China compared with that in France. But a lot of things need to change from a regulatory perspective to make that happen," he said.