FOR EXECUTIVE SUMMARY PLEASE CLICK HERE
With the promise of increasing liberalism throughout the 1990s, and with economic growth averaging 6.5% per annum over the last eight years, it is no surprise that investors were attracted to the Russian market. Since the presidency of Vladimir Putin however, the government has rolled back the framework of the liberal state that encouraged such mutual co-operation. The freedom of the press and the autonomy of business have been restricted, with the opposition being treated ever harsher and the rigging of elections becoming routine. This worrying disregard for democracy has contributed to a greater unease in the foreign policy thinking in European capitals when it comes to the energy rich giant to the East. Yet, the consequences for business and investment in Russia have been equally disturbing. The story of business and politics in Russia after the fall of Communism is not a happy one, and serious discussion is now required so as to help governments, analysts and businesses understand the extent of their intertwining.
No-one knows better than Bill Browder that even with the best of intentions, practices and track record, the political wind can turn investments in Russia sour. In 1996, together with the late Edmond J. Safra, he founded Hermitage Capital Management, a global investment advisory firm specialising in emerging markets. Despite being at one time in charge of the largest foreign direct investment in Russia and a vocal supporter of the Kremlin, in 2005 Mr Browder was denied entry to Russia on the laughable grounds that he was a ‘threat to national security’. Bad turned to worse: equipment and documents were seized from Hermitage offices, persons associated with the firm suffered violence, and Browder found his company re-registered in the name of a lackey of the regime. The extortion and intimidation did nothing to quieten Mr Browder’s continual calls for intervention, yet even when he became an international news story the Kremlin continued on its path. Says Mr Browder: “If ever there was a definition of legal nihilism,” he states, “this is it.”
By kind invitation of Greg Hands MP, the Henry Jackson Society is pleased to be able to invite you to a discussion with William Browder, CEO of Hermitage Capital Management. Mr Browder's leadership of Hermitage Capital's campaign against fraud at Gazprom resulted in enormous returns for investors, including many who benefited from his actions without ever having put their money in Mr Browder's fund. Mr Browder's towering reputation in the financial world coupled with his principled stand in the Gazprom saga is guaranteed to make him a guest of the highest value to those concerned with the issues at hand. He will comment upon his ordeal and the implications and lessons he draws for investors, analysts and politicians in Europe and the US.
TIME: 6-7 pm
VENUE: Committee Room 8, House of Commons, London, SW1A 0AA
To attend, please RSVP to alexandra.walton@henryjacksonsociety.org
William Browder was born in Chicago in 1964 and educated at Chicago University and Stanford Business School. He started his career at the Boston Consulting Group, working in the Middle Eastern Practice; thereafter he worked at Salomon Brothers, on the proprietary trading desk, specialising in Russian and Eastern European stocks. In 1995 Mr Browder set up the Hermitage Fund with Edmond Safra, founder of Republic Bank. He started with $25 million in 1996, achieving almost tenfold gains in 18 months and then raised $1billion from new investors. At one stage the pot totalled $4 billion and Hermitage became Russia's biggest foreign portfolio investor. However, Mr Browder offended someone with great power - he insists that he still does not know who - and in November 2005 was refused re-entry into Russia. He has not returned since. In 2007 Hermitage raised $625 million for a new fund focused on the Middle East. Mr Browder, who serves as chairman of the Russia Task Force for the Institute of International Finance, is a member of the Organisation for Economic Co-operation and Development and of the World Bank Round Table on Corporate Governance in Russia.