The Financial Conduct Authority’s (FCA’s) probe into competition within the asset management industry has been welcomed as a means to “debunk some of the myths” surrounding the role of consultants, Aon Hewitt says.
The FCA announced in its 2015/16 business plan it would undertake a market study to address a number of areas within the asset management value chain where competition may not be working effectively and to see whether institutional and retail investors were getting value for money.
As part of this, it will seek to understand how investment consultants affect competition for institutional asset management.
Aon Hewitt welcomed the review, saying it would “provide a great opportunity to debunk some of the myths that surround the role of the investment consultant”.
Partner Tim Giles said: “In our view, the investment consulting market operates competitively, with many players and no barriers to entry. Pension scheme trustees are freely able to move to new providers and there is strong competition on price and quality. Market surveys also point to high levels of satisfaction. The standard of pension trustees has never been higher, and they make sure that they get the service they need from their investment consultants.”
The review comes at a time when the boundaries between giving advice and managing money continue to blur as consultants move into delegated investment services.
Giles added: “We regard the advisory or fiduciary approaches to consulting as merely routes of implementation, and we are neutral between them. Our strategic advice to clients is structured to ensure that the solutions we suggest reflect this implementation neutrality.”
Comments