Why You Might Miss Big Opportunities With Passive Investing, CEO Says | At Barron's

Why It Matters

If passive ownership continues to crowd public markets, capital allocation may favor short-term signals over long-term value creation, reducing innovation, depressing public-market returns and pushing more companies into private markets where public investors can’t participate.

Summary

Tim Campbell, CEO of Baillie Gifford, warned that the growing dominance of passive, algorithmic and factor-based investing—now over 50% of public markets—has produced faceless shareholder registers that weaken long-term stewardship. Citing research that firms with concentrated, engaged shareholders outperform by roughly 3.4% over decades, Campbell argued that active, long-horizon investors are essential to back risky, transformative bets like Amazon Prime, the iPhone and Tesla. He said the market’s structural tilt is driving some companies to stay private or go private, and urged investors to embrace optimistic, long-term approaches while accepting inevitable failures. Baillie Gifford’s strategy remains focused on finding and supporting the small handful of high-growth businesses that drive disproportionate returns.

Original Description

Tim Campbell, CEO of Baillie Gifford, spoke to Barron's editor at large Andy Serwer. This interview was filmed on May 12, 2026.

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