Fidelity Investments announced on March 24 that former chairman and CEO Edward “Ned’ Johnson III died. He was 91 years old. Over nearly four decades as CEO of mutual fund giant Fidelity, Johnson oversaw growth in managed assets from $3.9 billion in the early 1970s to $1.7 trillion in 2014, when he stepped down as CEO. At the time of his passing Johnson was ranked the 67th richest person in America, worth an estimated $10.1 billion.
Fidelity Investments was started in 1946 by his father, Edward Johnson II. In 1957, after attending Harvard and serving in the U.S. Army, Johnson joined the then 70-person company as a research analyst. Data driven and detail oriented, Johnson started running Magellan, the company’s flagship mutual fund, in 1963. The fund delivered an impressive 30% average annual return, compared to the S&P 500’s 8%, for the nine years he was in charge. Johnson became president of Fidelity Investments in 1972 and chairman five years later. Fidelity now has $4.5 trillion in assets under management.
Johnson established a reputation as an innovator in the financial services industry. In a 1981 interview with Forbes, he said “Watch the competition carefully. That’s usually the place to get ideas.” Under Johnson’s leadership Fidelity started a toll-free number for investor services in 1974 and that same year introduced the practice of writing checks against money market accounts. The company was a pioneer in the direct marketing of mutual funds and one of the first to offer 401(k) administration. An early investor in computers and technology, Fidelity began to offer clients computerized trading on floppy disks in the early 1980s and was the first mutual fund firm to create an online home page in 1999.
A privately held company, Fidelity Investments was ranked 10th on Forbes’ 2021 list of the largest private companies in the U.S. Johnson and his children own 49% of Fidelity while company executives hold the remaining 51%, according to the company. He stepped down as CEO in 2014, handing the reins over to his daughter, Abigail Johnson. Two years later he retired as chairman of the board with Abigail taking on that role as well. Son Edward Johnson IV is the president of Pembroke Real Estate, a developer which is owned by Fidelity’s parent company FRM. Daughter Elizabeth Johnson has no role at the company.
A member of The Forbes 400 since 1985—that year he was ranked 212th with an estimated net worth of $180 million—Johnson never commented on his wealth. He used his fortune to support a variety of civic and arts organizations as well as colleges and universities, donating millions over the years. The Edward C. Johnson Fund, the family’s charitable foundation, has given away nearly $1 billion since 2000. Johnson set up the Brookfield Arts Foundation in 2000, a non-profit that allows Johnson to buy art and lend it to museums. Currently the foundation has nearly 600 objects on display in museums throughout the U.S. as well as in the U.K and Bermuda. Notable recipients include the Museum of Fine Arts in Boston, where Johnson is an honorary trustee, and the Peabody Essex Museum in Salem. Known for being an intensely private man, he never put his name or his family’s name on the gifts.
Johnson is survived by his wife, Elizabeth (known as Lillie), his children Abigail, Edward IV and Elizabeth, and 13 grandchildren. According to a LinkedIn post from his daughter Abigail, Johnson passed away peacefully at home in Florida, surrounded by his family.