The data reported in this week’s fifth FM review, which analyses over £60bn of pension scheme assets under management, found that many managers have yet to recover from market shocks over recent years.
The report from the leading consultancy offers trustees and sponsors independent insight into how fiduciary managers (FMs) have performed – both in the context of a strong market year and over the longer term.
Key findings of the report are.
• Many FMs have struggled to beat their objectives over the longer-term, despite equity market tailwinds.
• On a relative basis, there appears to be winners and losers over the long-term – meaning manager selection is key.
• Almost 50% of mandates are now concentrated in the liabilities +0.5% to 1.5% bracket, with different investment strategies leading to vastly different outcomes.
• Manager dispersion remains high, with outcomes of more than 10% were recorded between the best- and worst-performing clients of the same FM.
• Regulation and policy were ranked as the top challenge for fiduciary managers going into 2025, overtaking hedging and inflation risks.
Commenting on the findings of the FM report, Peter Daniels, Partner and Head of Outsourced Investment Services, Barnett Waddingham, said: “The findings of this year’s review provide an interesting backdrop for the many pension schemes that will be formally reviewing their FM arrangements over the coming year. We are approaching the five-year anniversary of tender activity instigated by the CMA review; as a result, trustee boards should be reflecting on whether their provider has delivered on its promises and whether their FM arrangements remain fit for purpose.”
Drawing on Global Investment Performance Standards (GIPS®) data, the review provides an in-depth, comparative view across return targets, investment strategies, and client experiences.
The report is designed to help professional trustees, scheme sponsors and pension managers challenge their FM’s performance, ensure value for money, and assess strategy alignment ahead of key decision points.
Fiduciary Management (FM) Investment Performance Review
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