U.K. Watchdog Shakes Up $2.1 Trillion Pension Manager Market
- Firms should run competitive tenders for fiduciary managers
- Changes may hit profit margins, accelerate consolidation
Photographer: Matthew Lloyd/Bloomberg
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The U.K. markets watchdog proposed rules to help pension funds overseeing more than $2 trillion get a better deal from the firms they pay for investment management and advice.
About half of the pension funds use the same consultants for investment advice and fiduciary management, a combination that’s likely to result in higher prices and worse service, the Competition and Markets Authority said in a statement on Wednesday. Some of the biggest fiduciary managers in the U.K., such as Aon Hewitt LLC, Mercer International Inc. and Willis Towers Watson Plc, make investment decisions on behalf of their clients.