News & Views

IC Select, established in 2007, is the only UK company that focuses entirely on selecting and monitoring investment consultants and fiduciary managers. This is the first time that it has made the findings of its annual fiduciary management surveys public.

In fiduciary management, a single provider is awarded the mandate to act as both investment consultant to a pension fund and as the manager of its assets. The model has become an increasingly popular alternative to the advisory consulting governance model, particularly among smaller schemes. The sharp rise in the average size of pension schemes converting to fiduciary management during the first half of the year comes as pension trustees were forced to dramatically adapt their practices after the onset of Covid-19.

With the vast majority working from home, it meant that holding regular meetings of trustee boards to discuss and review performance and best practice was made much more complicated, particularly as investment markets were extremely volatile at the time.

Some trustees, including at bigger schemes, appear to have used the crisis as a way of making their governance and management arrangements more robust in order to be better prepared for future problems.

Director and Head of Research Anne-Marie Gillon said “recent years have seen a significant increase in the adoption of fiduciary management by trustees.  Much of this has been driven by the increasing complexity of investment solutions and the economies of scale that can be achieved, particularly for smaller schemes.  However, the reassessment of governance practices, as a result of Covid, at the same time as a need to react to rapidly changing markets, appears to have given a further boost to the sector.”

IC Select also found in its annual survey that:

  • The UK fiduciary management market has almost doubled in size by number of funds, increasing by 96% over the past five years; based on assets under management, the market has grown by 170% over the same period.
  • The vast majority, or 78%, of fiduciary management contracts retendered on the instructions of the Competition and Markets Authority over the 18 months to 30th June 2021 were won by incumbent providers.
  • Just 10% of pension schemes that use fiduciary managers receive their strategic advice from a third party.
  • Only a minority of schemes, at 31%, seek independent oversight of their provider, despite encouragement from The Pensions Regulator.

For the survey, IC Select sent a detailed questionnaire to 17 of the leading participants in the fiduciary management sector. Data from the responses were taken as at 31st December 2020 and then updated to 30th June 2021. Previous IC Select annual surveys were used for comparison and for aggregating the data.

A full version of the survey is available.

Notes to editors

IC Select is an independent, employee-owned firm that was established in 2007. It focuses solely on the selection and oversight of investment consultants and fiduciary managers. The full list of participants in the annual survey and update is: Aon, BlackRock, BMO, Cambridge Associates, Cardano, Charles Stanley Asset Management, Goldman Sachs Asset Management, Kempen, Legal & General Investment Management, LGT Vestra, Mercer, River and Mercantile, Russell Investments, Schroders, SEI, State Street Global Advisors and Willis Towers Watson.

For enquiries, please contact:

Anne-Marie Gillon –  anne-marie@ic-select.co.uk

OR

Peter Dorward – peter@ic-select.co.uk

[1] We have excluded from our figures for average scheme size the funds of two large schemes that have recently transferred to fiduciary management from management by an in-house team.

Had their combined assets been included in the analysis, then the average scheme size would have increased to more than £1.3 billion.

Size of schemes converting to fiduciary management surges in H1

September 07, 2021 – The average size of a pension scheme taking on a fiduciary manager shot up by nearly 80% during the first half of the year as the benefits of the model took hold in the thick of the Covid-19 pandemic, according to IC Select.

In its latest annual survey of the fiduciary management sector, published today, IC Select found that the average size of a UK pension scheme recruiting a fiduciary manager to oversee its assets rose by 79% to £270 million over the six months to 30th June 2021.[1]

That marks an increase of £120 million against the average figure over the preceding five years, which stood at roughly £150 million, according to IC Select’s research.

Additional information on this topic is available on request – contact info@ic-select.co.uk

Source:https://www.professionalpensions.com/news/4019886/civil-aviation-authority-awards-gbp4bn-fiduciary-mandate-blackrock

“IC Select is proud to have assisted the trustees of Civil Aviation Authority Pension Scheme with this selection exercise, one of 17 similar investment adviser selection projects for DB schemes in 2019-2020 ytd, totalling £13bn. Who said that Covid-19 has slowed things down!”

The Civil Aviation Authority Pension Scheme (CAAPS) has appointed BlackRock to run a £4bn fiduciary mandate for its growth portfolios.

Following a competitive tender process, the manager was chosen to plan and execute the asset allocation and manager selection across all asset classes in the portfolio for both the CAA and the National Air Traffic Services (NATS) sections.

Anne-Marie is joining IC Select at a time when Covid-19 is wreaking havoc around the globe and, as a result of all the restrictions in place, she has been hired not having met the other directors face-to-face. All meetings took place via Zoom video-calls, like so many other meetings currently.

Her hire follows hot on the heels of the appointment of industry veteran Ray Martin who joined as a director just prior to the Covid-19 crisis.

In her client facing role Anne-Marie will be delivering IC Select’s investment governance services such as trustee training, selection and oversight of the investment consultants and fiduciary managers as well as to further develop the breadth and depth of IC Select’s research and insights in particular.

Peter Dorward Managing Director of IC Select, said: “Anne-Marie’s appointment arises from the rapid growth in demand for IC Select’s investment governance services. Her client focused investment background, and being a CFA holder, adds to the existing mix of directors who bring actuarial, investment and hands on pension fund experience to the table. Her fresh thinking and different perspective having worked at an asset manager and most recently with focus on fixed income, will greatly enhance our capabilities and ultimately help trustees make appropriate decisions.”

Anne-Marie said: “I am delighted to be joining the innovative and growing team at IC Select at a time of increased investment complexity caused by Covid-19 and regulatory change. I am looking forward to working with trustees to help find the most appropriate investment governance solution for their needs then supporting them on that journey afterwards.

In the past year IC Select has hired several senior professionals and the hires come after a surge in demand for independent advice following the Competition and Marketing Authority’s (CMA) review into the investment consultants and fiduciary management markets.

The IC Select team have been researching investment advisers since 2000, investment consultants initially then fiduciary managers and are now recognised as one of the leading third-party evaluators. The firm, recognised for its independence, now provides detailed research on all leading investment consultants and third-party fiduciary managers operating in the UK.

For further information please contact:

Peter Dorward,
Managing Director
0131 344 4462
peter@ic-select.co.uk
www.ic-select.co.uk

Donny Hay,
Director
0131 344 4463
donny@ic-select.co.uk

Notes to Editors:

IC Select

IC Select specialises in helping pension funds select, monitor and review investment consultants and fiduciary managers. The firm’s assessment capabilities leverage its unique positioning:

– wholly independent

– free of conflicts

– research led

– focused on assessment from an investors’ and investment perspective

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

Press Release:IC Select make another senior hire

Edinburgh, 10th June 2020 – IC Select, the specialist fiduciary management selection and oversight firm, has appointed Anne-Marie Gillon as director of the company to boost its client facing services.

Anne-Marie has joined after a 22-year career as an investment professional at Baillie Gifford. The past 12 years she focused on fixed-income and multi-asset products. In addition, Anne-Marie is a CFA charterholder as well as a trustee, currently at the Royal Blind Group pension scheme, which enables her to understand the intricacies and challenges that pension schemes face

IC-Select is responding to this predicament with a three-tiered solution, to help trustees overcome these important dilemmas in the most efficient way possible. The most appropriate solution for each trustee board will depend on how comfortable they are with their current fiduciary manager and how likely they will be to change to a new provider following a tender process.

The first tier allows those trustees boards happy with their current fiduciary manager to minimise the cost and resource required for a re-tender, but still achieve compliance with the CMA’s requirements. Trustee that would like to challenge their fiduciary manager’s approach to a greater extent but believe it unlikely they will change, would use the second-tier service. The top tier enables a much more in-depth review and is appropriate for those trustee boards who wish to carry out a full market review of their fiduciary manager, after all you don’t know what you don’t know.

All three tender solutions are underpinned by IC Select’s market leading fiduciary management research which rates fiduciary managers according to the nine value-creating functions of fiduciary management.

This new three-tier approach is supported by an assessment of the performance and costs of the incumbent manager to give confidence to trustees on the suitability of their existing manager. All three tiers have been re-engineered to allow trustees to complete the process whilst adhering to Covid-19 related restrictions so that trustees can meet the deadline a little over a year from now.

Peter Dorward, managing director said “This IC Select initiative arises from growth in demand for a more streamlined re-tender service from trustee boards who are very happy with their current provider and don’t expect to change. Clearly, these boards should follow a more light touch process that still meets their legal responsibility under the new rules than those seeking to change provider.

We see no sign of the CMA moving the initial deadline for completion of tenders from June next year. With the clock ticking, those trustees required to re-tender should not delay in starting the process. This is why we have ensured that all re-tenders can be completed during the Covid-19 restrictions so that trustees can avoid being caught in a scramble to achieve compliance at the start of 2021“.

For further information please contact:

Peter Dorward,
Managing Director
0131 344 4462
peter@ic-select.co.uk
www.ic-select.co.uk

Donny Hay,
Director
0131 344 4463
donny@ic-select.co.uk

Notes to Editors:

IC Select

IC Select specialises in helping pension funds select, monitor and review investment consultants and fiduciary managers. The firm’s assessment capabilities leverage its unique positioning:

– wholly independent

– free of conflicts

– research led

– focused on assessment from an investors’ and investment perspective

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

Press Release:IC Select launches Fiduciary Management re-tendering solution

Edinburgh, 11th June 2020 – IC Select, the independent specialist fiduciary management selection and oversight firm, has launched a three-tiered solution to help trustees who are required to re-tender before the CMA deadline of 10 June 2021

Managing cost, resource allocation and, critically, the proportionate time to be allocated to this task will be paramount. Additions to these challenges arise when access to unbiased and accurate information is cumbersome and hard to find.

 

Peter Dorward, Managing Director of IC Select, said: “John’s appointment arises from the rapid growth in demand for IC Select’s investment governance services and is another example of our ability to hire knowledgeable people who really understand and are committed to supporting the work we do with trustee boards. He adds to our mix of experience and enthusiasm, driven by a passionate belief that what we do makes a difference and matters.”

 

John said: “IC Select’s reputation as the leading investment governance adviser was a great attraction to joining their team. Their independence, research focus and record of innovation in this field sets them apart and comes at a much-needed time following the CMA review. It’s really no surprise that their insights are in such high demand given the investment complexity that DB trustee boards face.  I look forward immensely to contributing to this work.”

IC Select have been asked to tender for over 50 opportunities since the CMA report was first published a year ago and are now working with over 20 new pension schemes with most of the remainder under discussion. While the focus of demand has been on fiduciary management selection and oversight (35 opportunities), advisory support has also taken off increasing tenfold in the same period.

The CMA review affects all DB pension schemes and significantly raises the bar in terms of investment governance for trustee boards and their advisers. The Orders will be enacted on 10 December 2019 and shine a spotlight on investment consultants and fiduciary managers. Allowing trustee boards to better judge whether they are doing a good job and assess whether they represent value for money.

IC Select provide their DB clients with the necessary expertise and analysis to enable them to select the most appropriate investment consultant or fiduciary manager, then monitor them effectively based on their level of performance. They developed the Fiduciary Management Performance Standard which the CMA review has now made mandatory for all fiduciary managers. 

ENDS


 

For further information please contact:

Peter Dorward, Managing Director

0131 344 4462

peter@ic-select.co.uk

 

Donny Hay, Director

0131 344 4463

donny@ic-select.co.uk

 

IC Select, the fiduciary management specialists, have appointed pension veteran John Paterson as director following rapid growth in demand for its services. John, who joins from JLT Group a leading investment and actuarial consultancy, brings over 30 years’ experience of actuarial work, investment strategy and interaction with trustee boards. His technical and investment experience adds to the 100 years of investment and pension fund experience possessed by IC Select’s team.   The hire follows a surge in demand for independent advice following the Competition and Markets Authority Review (CMA Review) into investment consultants and fiduciary managers.

NULL

 

Last year, IC Select won support from fiduciary managers across the UK for a performance measurement standard to help clients appraise the value they offered. Administration of the service is expected to move to the CFA Institute in the near future.

 

This exercise, Project Spotlight, aligns with the Financial Conduct Authority’s mission to develop transparency standards for the performance and costs incurred by pension schemes. It also answers the challenge laid down by the Competition and Markets Authority to The Pension Regulator to develop guidance for trustees to be able to assess the performance of their advisors and challenge them more readily and effectively.

 

Spotlight will allow scheme specific analytics and costs to be presented in an independently produced annual report allowing pension trustees to compare their risk-adjusted performance, investment costs and asset allocation strategy against a peer group of similar funds selected from the universe of UK wide defined benefit pension schemes.

 

The FCA has said: “Providing comparable data on the performance of investment consultant advice would benefit trustees and the sector as a whole.”

 

The Competition and Markets Authority, currently reviewing the activities of investment consultants, said at the start of their review that the development of an industry standard template for the reporting of fees and performance would make: “value for money more transparent and comparable across different consultants.” In the recently published CMA Provisional Decision report it was found that there was a “lack of clear and comparable information for customers to assess the quality (performance) of their existing investment consultant and “a lack of clear and comparable information for customers to assess the value for money of alternative providers”

 

Spotlight is an industry-wide database which captures key pension fund data. Initially this would include standardised performance relative to liabilities and cost data, together with fund information such as asset values, funding levels, covenant strength, risk data and asset allocation. Over time, other information, such as client satisfaction can be added.

 

Based on the information in the database, each trustee board, would decide the parameters of their own customised peer group against which to benchmark their performance and cost. These peer group parameters could be based on schemes with similar characteristics in terms of asset size, funding level, return objective and liability hedging level or based on industry sectors.

 

Trustees would receive a written report from the Spotlight database which would benchmark their performance and costs against their peer group and also include information on how their asset allocation compares to the peer group.As a result, trustees will be able to assess whether the advice they receive from and the fees they pay to consultants represent value for money.

 

Roger Brown said “we believe this solution has the potential to address the CMA’s concerns around the lack of demand side challenge by giving trustees relevant and comparable information, to understand the effectiveness and costs of their governance solution. The beauty of the approach is that the report can be delivered in a highly cost effective manner, costing no more than a few hundred pounds for smaller schemes.

 

Our initial discussions with trustees, has shown strong support for the project. However, there are still significant challenges to overcome before the service can be launched, although the involvement and support of the major consultants and their willingness to embrace greater transparency is a significant step towards achieving this.”

 

For further information please contact:

Peter Dorward,

Managing Director

0131 247 7439

peter@ic-select.co.ukwww.ic-select.co.uk

 

Roger Brown,

Founder and Director

0131 247 7454

roger@ic-select.co.uk

 

Donny Hay,

Director

0131 357 4616

donny@ic-select.co.uk

Please click here for the pdf.

London,2 October 2018 – the Big Three investment consultants – Aon, Mercer and Willis Towers Watson – have agreed to take part in top-level talks, hosted by governance specialist IC Select, to develop a strategy to show whether they provide value for money to their advisory pension scheme clients.

 

The other consultants who have so far agreed to participate in the first round of talks are Cardano, KPMG, Redington, River and Mercantile, and Momentum. Discussions with further firms are ongoing.

NULL

 

Mandatory tendering is an effective way of dealing with conflicts of interest that arise when an investment consultant offers fiduciary management to existing clients. This enshrines the best practice followed by many trustee boards who recognise the value that can be gained from a competitive tender process.  Trustees need to ensure that they have a robust governance process when selecting fiduciary managers, or advisers for that matter.  Best practice would suggest that trustees get written advice from an independent third party organisation, so that they can demonstrate appropriate due diligence and process, whenever they appoint a new a fiduciary manager or adviser.  This is analogous to the section 36 letter trustees require when they appoint any other fund manager.

The call for the introduction of common standards for performance reporting underlines the work that IC Select have undertaken in recent years culminating in the launch of the IC Select Fiduciary Management Performance Standard in April 2018. The standard helps pension schemes compare the skills of fiduciary managers hired by trustees to make investment decisions on their behalf. It also mitigates against the risk that managers would cherry pick performance data to look as attractive as possible to their potential clients, during a tender process

We welcome the call for greater demand side challenge in advisory consulting by improving the information that is made available to trustees. This is something that IC Select has been developing and discussing with investment consultants and we hope that these discussions will bear fruit over the coming months. As the report highlights access to comparative information and greater transparency should lead to greater trustee engagement which as the CMA can reduce the fees paid to the successful firm by up to 25%.

Finally we fully support the call for trustees to set clear objectives when hiring an investment consultant.  In our discussions with consultants to improve demand side challenge we have  addressed this by requiring consistent reporting of performance as the returns net of all fees relative to a liability benchmark. Standardising performance, and costs, in this way will help trustees better assess whether they are receiving value for money from their investment adviser.

For the pdf version: click here

For further information please contact:

Peter Dorward, Managing Director

0131 247 7439

peter@ic-select.co.uk

www.ic-select.co.uk

Roger Brown, Founder and Director

0131 247 7454

roger@ic-select.co.uk

Notes to Editors:

IC Select

IC Select, the oversight and selection specialist, specialises in helping pension funds select, monitor and review investment consultants and fiduciary managers.  The firm’s assessment capabilities leverage on its unique positioning:

– Wholly independent

– Free of conflicts

– Research led

– Focused on assessment from an investors’ and investment perspective

IC Select is a wholly independent organisation and is placed in a unique position amongst third party evaluator firms, as the only organisation that is able to conduct in depth research of both the advisory and delegated investment services of the major investment consultants, as well as other fiduciary management providers.  By not competing with these firms, IC Select has unparalleled access to detailed information not available to other third party evaluators.

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

CMA Report marks turning point in drive for transparency and good governance

 

London, 18th July 2018  – Advisory firm IC Select welcomes the CMA provisional decision report and support the decision not to split up the investment consultants which we felt would have been detrimental to the investment services that many pension funds receive from them.

Peter Dorward, Managing Director, IC Select, commented: “Overall we believe the report and the process of discussion with the industry has changed attitudes towards transparency for the better by investment consultants and fiduciary managers. The remedies proposed will ensure that as the process moves forward from here, these transparency gains are not lost”.

NULL

 

The IC Select Fiduciary Management Performance Standard has been designed to help pension schemes compare the investment performance of fiduciary managers hired by trustees to make investment decisions on their behalf.

 

It is already backed by 14 leading fiduciary managers providers, Aon Hewitt, BlackRock, Cardano, Charles Stanley, Goldman Sachs Asset Management, JLT Investment Solutions, Kempen Capital Management, Legal & General, Mercer, P-Solve, Russell Investments, Schroders, SEI and Willis Towers Watson.

 

The standard developed by Edinburgh-based IC Select is supervised by the Fiduciary Management Performance Standard Steering Group.

 

Peter Dorward Managing Director of IC Select, said: “We are delighted with the cross-industry support we have received for the performance standard. When firms come together with a common objective real change can be achieved. This collective demand will ensure that the fiduciary managers will be held accountable and Trustees can gain access to reporting of performance on a consistent and transparent basis”

 

The new standard, which was recently launched in April 2018, comes at a time of intense scrutiny of fiduciary managers and investment consultants by the Competition and Markets Authority. It will enable trustees for the first time to obtain consistent performance information when selecting a fiduciary manager.

 

For the pdf version: Click Here

London, 1 June 2018 – Third party evaluators of fiduciary management Barnett Waddingham, Hymans Robertson, IC Select, KPMG, Lane Clark & Peacock and XPS Investment have backed the Fiduciary Management Performance Standard.

 

They believe that all Fiduciary Managers should have the capability to comply with the standard, or explain why this is not the case.

 

Mallowstreet, the social network for pension schemes, recently asked their membership whether trustees need a fiduciary management performance standard. The result was 100% in favour – a rare consensus.

NULL

 

Dorward added: “Given the heightened awareness of the need for more focused governance Trustees need to have a way to benchmark scheme performance – and fees – and the quality of the advice they are receiving against their peers, so they can see whether they are getting value for money.”

In April, IC Select launched a Fiduciary Management Performance Standard to help pension schemes compare the skills of fiduciary managers hired by trustees to make investment decisions on their behalf.

The standard is backed by 14 providers including the “big three” investment consultants, Mercer, Willis Towers Watson and Aon.

The survey coincides with an investigation of investment consultant activities by the UK Competition and Markets Authority, which started in November 2016.  The results of the review are due to be published in July 2018.

 

For the pdf version: click here. 

 

For Media Enquiries:

Mike Foster

Montfort Communications

+44 (0) 203 770 7915

foster@montfort.london

 

For further information please contact:

Peter Dorward, Managing Director

0131 247 7439

peter@ic-select.co.uk

www.ic-select.co.uk

 

Notes to Editors:

Chart 1 shows the percentage of clients that retendered their consultancy services and the percentage that changed consultant firm in each year.  The clients that changed consultancy firm is adjusted for clients lost as a result of schemes entering the PPF and schemes merging.  This data shows a clear decline in the amount of retendering activity in recent years.

Chart 1: % of advisory clients retendered and changed consultant

 

 

Changed

Retendered

2008

11.0%

18.6%

2009

8.4%

16.3%

2010

4.5%

9.0%

2011

4.0%

6.6%

2012

2.9%

4.3%

2013

3.3%

5.2%

2014

2.8%

4.1%

2015

1.0%

1.6%

2016

1.3%

2.5%

2017

1.5%

2.7%

 

IC Select

IC Select, the oversight and selection specialist, specialises in helping pension funds select, monitor and review investment consultants and fiduciary managers.  The firm’s assessment capabilities leverage on its unique positioning:

– Wholly independent

– Free of conflicts

– Research led

– Focused on assessment from an investors’ and investment perspective

IC Select is a wholly independent organisation and is placed in a unique position amongst third party evaluator firms, as the only organisation that is able to conduct in depth research of both the advisory and delegated investment services of the major investment consultants, as well as other fiduciary management providers.  By not competing with these firms, IC Select has unparalleled access to detailed information not available to other third-party evaluators.

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

 

Investment Consultant Tenders in Sharp Decline

London, 21 May 2018 – Around 2.7% of pension schemes retendered for investment consulting services in 2017 – less than a sixth the proportion of a decade ago – according to a survey of 1,000 schemes, worth £697 billion, by oversight and selection specialist IC Select.

This is a marginal increase on the 2.5% of 2016 and 1.6% of 2015.  But these proportions mark a sharp decline on 18.6% of 2008. Retenders have been bumping along at a low level over the three years despite growing scrutiny of investment consultant expertise and questions over the level of tender activity.

IC Select’s survey of schemes on their database also showed 1.5% of schemes ended up changing their consultant, against 11% in 2008, marking a steady decline over ten years. The changes stripped out scheme mergers, and entries into the Pension Protection Fund.

Peter Dorward, managing director of IC Select, said: “It is surprising the level of tender activity over the last three years has been so low. This follows the spread of de-risking plans, which has added to the complexity of investment affairs and, potentially, ties schemes more closely to incumbent advisers.”

NULL

Providers believe the standard will answer accusations that existing fiduciary manager selection procedures have lacked transparency and produced performance disappointments.

IC Select has appointed Donny Hay, former head of fiduciary management client relations at Kempen as a director to help develop its business.

Donny Hay said: “I have spent seven years working as a professional trustee at Law Debenture and PTL Governance, as well as Kempen. The experience showed me that trustees need better guidance in deciding which fiduciary managers to pick and in judging their performance afterwards.”

The Standard, developed by Edinburgh-based IC Select is led by Roger Brown, founder director and Peter Dorward, managing director. It incorporates data relating to the fiduciary arrangements of 520 pension schemes worth a total of £84 billion. The fiduciary management industry has grown in size by 25% per annum over the last five years.

The initiative is now supervised by the Fiduciary Management Performance Standard Steering Group, comprising eleven independent members (for full list see below).

Trustees have struggled to compare fiduciary managers because they ask each of them to take different approaches to hedging and allocating assets.

Peter Dorward said: “This has led to the risk that managers would cherry pick performance data to look as attractive as possible to their potential clients, during a tender process.”

In its 2016 review of asset management, the Financial Conduct Authority said: “Trustees find it difficult to assess the quality of advice provided by investment consultants and the services of fiduciary managers.”

It asked the Competition and Markets Authority to see whether consultants, and their fiduciary arms, were abusing a monopolistic position. In March, the CMA said: “The evidence reviewed so far indicates that competitive processes are not providing customers with the necessary information to judge the value for money of investment consultants and fiduciary managers.

Fiduciary managers have responded to the challenge by agreeing to support the new Standard by supplying it with data on composite portfolios as if they retained full discretion to manage, and hedge,scheme assets.

The composite portfolios can be directly compared to enable trustees to assess the skill of fiduciary managers during tender processes.

It will be up to managers to compile their own composite data, whilst being asked to comply with IC Select’s guidelines. IC Select opposes the production of performance league tables, given the wideswings of valuation which can result from rises or fall in interest rates and the limited value of such tables in forecasting future performance. Managers will continue to look after portfolios in line with trustee requirements, although schemes can request composite data for comparison purposes.

Dorward compares IC Select’s liability benchmark to the Global Investment Performance Standards(or GIPS) where standards are laid down through the CFA Institute for strategies put together by asset managers, to prevent the abuse of performance records.

Peter Dorward said: “The new standard enables trustees for the first time to obtain consistent performance information when selecting a fiduciary manager. This will significantly enhance their ability to understand the differences between them.”

He said a rise in bond yields and fall in markets would prove to be testing for fiduciary managers,making it important for their skills to be effectively assessed, noting that falling, and stable, interestrates have provided fiduciary managers with a following wind for many years relative to many advisory funds.

ENDS

For a print version of this press release click here.

 

For Media Enquiries:

Mike Foster
Montfort Communications
+44 (0) 203 770 7915
foster@montfort.london

For further information please contact:

Peter Dorward, Managing Director
IC Select
0131 2477439
peter@ic-select.co.uk

 

Notes to Editors:

IC Select Fiduciary Performance Standard Steering Group:

Peter Dorward (Chair) Managing director IC Select
Roger Brown Founder IC Select
David Clare Partner Barnett Waddingham
David Felder Director Law Debenture
Mark Latimour Partner Eversheds
Kevin LeGrand Past President PMI
Iain McAra GIPS Director CFA Institute
Neil McPherson Managing Director Capital Cranfield
Giles Payne Director Capital Cranfield
Colin Richardson Client Director PTL Governance
James Trask Partner LCP
Graham Wardle Managing Director BESTrustees
Anthony Webb Head of FM Advisory KPMG

 

IC Select

IC Select, the oversight and selection specialist, specialises in helping pension funds select, monitorand review investment consultants and fiduciary managers. The firm’s assessment capabilities leverage on its unique positioning:

– Wholly independent
– Wholly independent
– Free of conflicts- Research led
– Focused on assessment from an investors’ and investment perspective

IC Select is a wholly independent organisation and is placed in a unique position amongst third party evaluator firms, as the only organisation that is able to conduct in depth research of both the advisoryand delegated investment services of the major investment consultants, as well as other fiduciary management providers. By not competing with these firms, IC Select has unparalleled access todetailed information not available to other third party evaluators.

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

London, 16 April 2018 – Advisory firm IC Select has launched a performance-measurement standard to help pension schemes compare the skills of fiduciary managers hired by trustees to make investment decisions on their behalf.

The IC Select Fiduciary Management Standard has been published amid unprecedented regulatory scrutiny of investment consultants. It has been backed by 14 providers including the world’s largest consulting firms Aon Hewitt, Mercer and Willis Towers Watson. The others comprise BlackRock, Cardano, Charles Stanley, Goldman Sachs Asset Management, JLT Investment Solutions, Kempen Capital Management, Legal & General, P-Solve, Russell Investments, Schroders and SEI.

NULL

Fiduciary management is becoming an increasingly attractive proposition for many Boards and we are seeing the market develop to accommodate this. However as this approach involves significant delegation of authority to the chosen firm, it is essential that Trustees implement a robust governance oversight structure to comply with the requirements of the Pensions Act 2004.  Failure to comply with the Act could leave Trustees personally liable for any failure.  The oversight should ensure that Trustees have appropriate visibility of the resources and operational platform of the fiduciary manager, key risks including investment, operational and governance risks as well as the performance of the Scheme assets.

IC Select’s Fiduciary Management Stewardship Service provides a comprehensive and cost effective oversight service that combines access to IC Select’s unique in-depth due diligence of fiduciary managers within a robust oversight structure.  This complements any existing oversight and allows Trustees to apply resources in the most cost effective and efficient way.

An essential element of IC Select’s Stewardship Service is the provision of a unique risk management framework that allows clear line of sight for Trustees of the key risks inherent in the operation of any fiduciary management service – operational and governance as well as investment risks.

Peter Dorward, IC Select, Managing Director said: “The Trustees of the UK Power Networks Pension Scheme set the highest governance standards for their scheme.  They have taken a diligent and detailed approach to both the selection and the establishment of their oversight framework for their fiduciary manager.  This has meant that we have had to enhance areas of our approach to meet their needs, in particular in the design and implementation of an appropriate risk management framework.  This risk management framework will ensure they have early sight of any potential challenges in their relationship with their fiduciary manager.”

Michele Hirons-Wood, Head of Pensions, UK Power Networks said     “We are delighted we appointed IC Select to work with us on this important project.  Their detailed understanding of the fiduciary management market and their willingness to customise their work to meet our needs has enabled us to build a comprehensive and robust platform for oversight of our fiduciary manager.  We are confident that this will provide comfort to our members and simplify the ongoing management of our scheme.  Having IC Select continuing to provide practical oversight for the UK Power Networks Pension Scheme is essential for our trustees to enjoy piece of mind and continued protection from the requirements of the Pensions Act.”

ENDS

 

Notes to Editor:

For further information please contact:

Peter Dorward, Managing Director

0131 221 6505

peter@ic-select.co.uk

IC Select, Forth House, 28 Rutland Square, Edinburgh EH1 2BW

Website: www.ic-select.co.uk

Tel: 0131 221 6505, Fax: 0131 221 6506.

 

 

IC Select

IC Select, the oversight and selection specialist, specialises in helping pension funds select, monitor and review investment consultants and fiduciary managers.  The firm’s assessment capabilities leverage on its unique positioning:

– wholly independent

– free of conflicts

– research led

– focused on assessment from an investors’ and investment perspective

IC Select is a wholly independent organisation and is placed in a unique position amongst third party evaluator firms, as the only organisation that is able to conduct in depth research of both the advisory and delegated investment services of the major investment consultants, as well as other fiduciary management providers.  By not competing with these firms, IC Select has unparalleled access to detailed information not available to other third party evaluators.

As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.

3rd February 2016

Press Release

IC Select launches enhanced Fiduciary Management Stewardship Service

IC Select has launched an enhanced Stewardship Service to further assist Trustees with oversight of their fiduciary manager. This enhanced Service follows their work with the UK Power Networks Pension Scheme in selecting their fiduciary manager and establishing a framework for effective oversight of their fiduciary management relationship.  It is the rigour with which the UK Power Networks Pension Scheme approached the move to fiduciary management, the selection of the manager and their determination to establish an effective oversight of their manager that has allowed IC Select to refine and enhance its Stewardship Service.

NULL

 It is the rigour with which the UK Power Networks Pension Scheme approached the move to fiduciary management, the selection of the manager and their determination to establish an effective oversight of their manager that has allowed IC Select to refine and enhance its Stewardship Service.

Fiduciary management is becoming an increasingly attractive proposition for many Boards and we are seeing the market develop to accommodate this. However as this approach involves significant delegation of authority to the chosen firm, it is essential that Trustees implement a robust governance oversight structure to comply with the requirements of the Pensions Act 2004.  Failure to comply with the Act could leave Trustees personally liable for any failure.  The oversight should ensure that Trustees have appropriate visibility of the resources and operational platform of the fiduciary manager, key risks including investment, operational and governance risks as well as the performance of the Scheme assets.

IC Select’s Fiduciary Management Stewardship Service provides a comprehensive and cost effective oversight service that combines access to IC Select’s unique in-depth due diligence of fiduciary managers within a robust oversight structure.  This complements any existing oversight and allows Trustees to apply resources in the most cost effective and efficient way.

An essential element of IC Select’s Stewardship Service is the provision of a unique risk management framework that allows clear line of sight for Trustees of the key risks inherent in the operation of any fiduciary management service – operational and governance as well as investment risks.

Peter Dorward, IC Select, Managing Director said: “The Trustees of the UK Power Networks Pension Scheme set the highest governance standards for their scheme.  They have taken a diligent and detailed approach to both the selection and the establishment of their oversight framework for their fiduciary manager.  This has meant that we have had to enhance areas of our approach to meet their needs, in particular in the design and implementation of an appropriate risk management framework.  This risk management framework will ensure they have early sight of any potential challenges in their relationship with their fiduciary manager.”

Michele Hirons-Wood, Head of Pensions, UK Power Networks said     “We are delighted we appointed IC Select to work with us on this important project.  Their detailed understanding of the fiduciary management market and their willingness to customise their work to meet our needs has enabled us to build a comprehensive and robust platform for oversight of our fiduciary manager.  We are confident that this will provide comfort to our members and simplify the ongoing management of our scheme.  Having IC Select continuing to provide practical oversight for the UK Power Networks Pension Scheme is essential for our trustees to enjoy piece of mind and continued protection from the requirements of the Pensions Act.”

ENDS

 

 

 

 

 

 

Notes to Editor:

For further information please contact:

Peter Dorward, Managing Director

0131 221 6505

peter@ic-select.co.uk

IC Select, Forth House, 28 Rutland Square, Edinburgh EH1 2BW

Website: www.ic-select.co.uk

Tel: 0131 221 6505, Fax: 0131 221 6506. 

IC Select has launched an enhanced Stewardship Service to further assist Trustees with oversight of their fiduciary manager. This enhanced Service follows their work with the UK Power Networks Pension Scheme in selecting their fiduciary manager and establishing a framework for effective oversight of their fiduciary management relationship.

NULL