Legal & General Investment Management (LGIM) has signed up to the code of transparency created for the Local Government Pension Scheme (LGPS), bringing the total number of signatories to five.
As the largest manager of LGPS assets with a total of £894bn assets under management (AuM), LGIM is the biggest investment house to sign up to the code's principals on cost disclosure, which requires data to be sent to funds in a standardised format.
Other managers that have signed up are Baillie Gifford which has £158bn AuM, Montanaro, Mondrian Investment Partners, and Majedie Asset Management.
LGIM head of local authorities James Sparshott said: "Given the ever-changing regulatory landscape and the increased need for transparency, we are supportive of transparent reporting. LGIM has been working in a number of areas to provide information to clients in order to assist them in their understanding and reporting of investment costs.
"We believe it is important the information provided is useful relative to its intent, and this means it should be at the right level of detail to inform but not to create confusion."
He added the firm is committed to on-going engagement with the LGPS and the Investment Association to ensure transparency in its reporting.
Meanwhile, another four of the UK's biggest asset managers told PP that they intend to sign up in due course, including Schroders, BlackRock, Pictet Asset Management and Newton Investment Management.
A Schroders spokesperson said the firm is "supportive of the code in principle and would expect to comply".
BlackRock plans to sign up to the code and is working to provide the data for the first reporting period in 2018, its spokesperson said. "From the start, we were supportive of the initiative to provide cost data to our LGPS clients using a common industry standard."
Meanwhile, Pictet plans to sign up before the end of this year's third quarter.
Its head of institutional for the UK and Ireland, Roger Price-Haworth, said: "We are very supportive of the code and the benefits that a common methodology for cost disclosure will bring to our local authority clients."
Newton said it intends to sign up in "due course", with its global head of distribution Julian Lyne saying:
"We welcome the initiative of a standardised template to provide greater transparency of the costs involved in managing investment portfolios. Newton is committed to keeping transaction costs down for our clients and to ensure we provide full disclosure of the costs incurred when investing on a client's behalf."
PP also reached out to other asset managers to ask whether they intend to sign up to the code. Jupiter Asset Management, Aviva Investors and Kames Capital have not yet responded to a request for comment.
Launched last month by the Scheme Advisory Board (SAB) , the transparency code is aimed at helping LGPS funds get a better handle on their costs and fees, and obtain the necessary data in order to report costs transparently. It comes after funds encountered difficulties in getting such data from asset managers.
While the code is only voluntary for managers, it is expected to set a gold standard in cost transparency across the LGPS, and with five managers already signed up and more follow, this structure seems to be working so far.
The code is underpinned by a data collection spreadsheet, which was developed by Dr Chris Sier and negotiated with the Investment Association (IA), and was piloted with the West Midlands Pension Fund (WMPF).
It will show costs in pounds and pence, and is based on the model used in the Netherlands.
The code's impact will be felt beyond the LGPS because the IA is set to introduce an almost identical version for the wider sector to maintain consistency.
WMPF chief investment officer Jason Fletcher recently spoke to PP about how it saved millions of pounds through a cost transparency drive.
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