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Asset managers step up on cost transparency

June 24, 2019 | Pensions
Asset managers step up on cost transparency

Data collection and analysis platform ClearGlass has added six asset managers to its list of firms that have provided 'exceptional' cost transparency to their clients.

ClearGlass provides investment cost reports to pension schemes by collecting and analysing data from asset managers, according to the standardised templates prescribed by the Financial Conduct Authority’s Institutional Disclosure Working Group (IDWG).

The platform was set up by Chris Sier, the former chairman of the IDWG and a professor at Newcastle University Business School.

Of those that have provided data, ClearGlass has highlighted the companies which have stood.

The company has now added six to this list, bringing the total of exceptional managers to 10.

These new managers, which include private markets and non-domestic managers, are Adam Street Partners, New Forests, Partners Group, PIMCO, Sands Capital Management and T. Rowe Price International Ltd.

The full list of exceptional managers now stands at:

Adam Street Partners
Baillie Gifford
Legal & General Investment Management
Majedie Asset Management
MFS
New Forests
Partners Group
PIMCO
Sands Capital Management
T. Rowe Price International Ltd.

The platform stated these companies distinguished themselves by using the Cost Transparency Initiative (CTI) template, supplying the data in less than seven days and setting up a single dedicated relationship manager to handle all requests from ClearGlass.

Mr Sier told FTAdviser that he decided to create this list to demonstrate to asset managers what the right behaviours were and also wanted to reward those who have worked hard.

He said: “What is interesting to me is that the managers on this list have one thing in common. 

“Every one of them has put aside anything that the regulation has said and what the rules are around transparency are and have instead concentrated on what is best for their clients.

“It means that when I ask them for data on behalf of their clients they provide it to a good standard and do not hide behind the excuse that the CTI has said that data does not need to be provided until the end of the year or that they haven’t yet built their systems.”

Last month, the CTI released templates and guidance aimed at asset managers, and other suppliers of services to pension schemes, which can be used to produce standardised cost and charges information.

This framework will allow pension scheme trustees to make clear cost comparisons across different investment platforms, enabling them to challenge asset managers on cost and performance to get better value for their clients.

The CTI expects asset managers to be in a position to report against December 2019 and April 2020 year-ends using the new templates and tools.   

Mr Sier said: “The fact that these managers started their transitions long before the templates were formally released shows outstanding vision, as well as a clear desire to do the right things for clients irrespective of the prevailing regulatory environment.

“At ClearGlass we measure success in how quickly we can obtain data from asset managers. All of the managers on this list have significantly reduced the lead-time to get data as a result of their firm-wide stances on transparency. What is becoming apparent is that culture within a manager has a significant role to play when it comes to being transparent.”

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