Callan's foray into US mutual fund boards market
US - Callan Associates is offering its advisory services to mutual fund boards, a new client area for the US-based investment consultant.
Callan is looking to mutual fund boards as potential clients in the wake of new Securities and Exchange Commission rules that increase the amount of oversight that mutual fund directors must exercise over their advisers. Callan will lever its manager research databases to provide research and advice to these clients, said Kelly Cliff, senior vice president and manager of global manager research at Callan.
But delving into advising mutual funds could represent a conflict of interest, noted Ted Siedle, president of the Centre for Investment at the Benchmark Companies and long-time critic of investment advisory conflicts of interest.
“Callan will be providing yet another service to money managers that manage both pension accounts and mutual fund accounts, and the compensation the derive from these managers could cause them to be less than objective in their vetting of managers for separately managed pension accounts,” Siedle said.Cliff at Callan added: “I think we have a pretty time-tested philosophy of what I’ll call institutional fiduciary process.
“I think there are more and more entities out there that are embracing that. “Historically, mutual fund boards have not used consultants to a great degree, and so we are starting a push in that area.”
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