Peter Dorward: Can fiduciary managers really maintain service levels and quality support for schemes at this fee level?
Median total fees for fiduciary management have fallen 27% over the past five years despite a 17% rise in median investment fees in 2024, latest research from IC Select reveals.
The fiduciary management oversight specialist's 2025 Fiduciary Management Fee Survey found that, while median investment fees increased by 17% in 2024 - marking the first rise since 2018 - median base fees declined by between 6% and 17% over 2024, with larger schemes seeing greater falls.
Median base fee change
Source: IC Select 2025 Fiduciary Management Fee Survey
Base fees are those paid directly to fiduciary managers for their services, while investment fees include asset management charges from underlying asset managers as well as the administration and custody costs of their funds. Total fees are the combination of the base fiduciary management fee and the investment costs.
The firm said median total fees have now fallen 27% over the past five years and median investment fees are now 32% lower than they were in 2018.
Total investment fees
Source: IC Select 2025 Fiduciary Management Fee Survey Note: The area in green on the charts marks the first quartile of fees
IC Select said the findings suggest that, while some costs are beginning to rise again, overall pricing remains significantly below its peak in recent years.
IC Select managing director Peter Dorward said: "Despite falling asset values and fiduciary management revenues, mainly due to rising yields since 2022, total fees have not risen for those defined benefit (DB) schemes with fiduciary management, rather consolidated at lower levels.
"While this could be seen as welcoming for schemes and sponsors, the flip side of that value coin is whether firms can really maintain service levels and quality support for schemes. It is hard for any business to sustain, and DB trustees should be alert to further consolidation or poor service as a consequence."
