AUSTRALIA - Jana Investment Advisers has topped an exclusive Global Pensions survey of Australian investment consultants' manager research capability, while Aon came last.
This research polled the Australian heads of institutional/wholesale at 19 asset management firms, and asked them to rate 12 consultants on a scale of zero to five on consultants’ manager research capabilities.
Respondents with no contact with a consultant were allowed to pass. Each consultancy firm was then given an average score. This is the first time Global Pensions has undertaken this poll of the Australian industry, having previously rated the US, UK and Ireland.
Jana outranked its nearest rival Watson Wyatt and respondents in general linked their scores to the high quality of Jana’s research, relatively low senior staff turnover, and the overall level of staff knowledge.
“It’s excellent feedback, and not bad for a home grown Australian firm,” said David Holston, executive director at Jana. “We think the research we undertake is thorough and constant. We don’t just drill down research from market databases – we go and do the face to face work ourselves, which may have some impact on the investment managers’ opinions.”
Respondents cited Wat-son Wyatt’s reputation for being an independent consultancy lacking conflicts of interest as contributing to its second-place score.
“I’m pleased that the independence angle has been noted by the fund managers – we’re not in any way seeking to compete with them,” said David Neal, head of investment consulting at Watson Wyatt.
“We hope that they’d be prepared to be more open with us about their business and their business models because of that, and we prefer to see ourselves as a partner to fund managers in developing products to meet our clients needs.”
Managers had some pointed criticisms of the industry’s manager research capabilities, citing high levels of staff turnover as a key problem. Several said consultants lowered ratings of fund managers with staff turnover while falling prey to the same problem themselves.
They also noted that super funds were building or augmenting in-house staff, reducing the need for investment consultants.
Aon declined to comment.
This week's top stories included Legal & General acquiring MyFutureNow to provide a dashboard service to customers, while also agreeing a hybrid buy-in with a Hitachi scheme.
NEST has signed up to the government-backed Star Initiative, taking all of its 8 million members' pension pots with it.
It is perhaps inherently difficult to find an agreed definition of value for money, but some methodologies could act as a stopgap, argues Jonathan Stapleton.