Support for fiduciary management in Russell Investments poll

A poll of over 30 pension fund trustees and other institutional investors from across Europe found 97% saw the speed of decision making and execution as an advantage in using a fiduciary manager, according to Russell Investments.

The poll was done at Russell’s 2012 London Investment Conference, as a follow up to its earlier research The Evolution of Investment Decision Making.

Other benefits suggested from fiduciary management by the poll include improved risk management (87% agreed) and increased investment diversification and sophistication (83%).

Russell said that the poll supported the earlier research, which looked in particular at decision making delegation in the UK long term savings market, among both larger schemes (more than £500m) as well as sub-£100m ones.

Heath Mottram (pictured), head of fiduciary management at Russell Investments in the UK, said: “We have been working with clients on governance structures for over 20 years and we’d argue that the critical component of delegation is the ability to execute decisions effectively. In this current market of volatility and low returns, the ability to be nimble is essential to capitalise on opportunities.”

“Trustees understand the importance of good governance, but they can underestimate the time it takes to achieve it, and the practical challenges of implementation. The majority of investment committees today are ‘watchdogs’ rather than ‘executioners’. Fiduciary management can therefore add real value by enabling faster and more effective decision making and execution.”

 

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