By IPE Staff2021-05-05T08:30:00+01:00
Pension funds rushing to meet the June deadline for compliance of the Competition and Markets Authority’s (CMA) retender of fiduciary managers rule could cut corners leading to poorly negotiated fees and inappropriate mandates, Hymans Robertson has warned.
With the deadline fast approaching, trustees making retender decisions solely based on time pressures could risk undertaking the process without a full commitment leading to poor outcomes for schemes, the consultancy said.
This means the assessment of the mandate and strongly negotiated fees may not be done thoroughly, it added.
Samora Stephenson, senior investment consultant at Hymans, said: “The purpose of the CMA’s deadline is for schemes to ensure that fiduciary management provides value for money for pension schemes, while at the same time demonstrating good governance.”
A third of DB schemes worryingly close to fiduciary manager retendering deadline
The deadline for schemes to complete competitive tender process is 9 June 2021
More than a third of defined benefit (DB) pension schemes are running “worryingly close to the deadline” to comply with the Competition and Market Authority’s (CMA) retendering order, according to Hymans Robertson.
A poll by the consultant revealed 38% of pension scheme trustees with fiduciary managers have not started the retendering process and are planning to review their manager or test the market before mid-June, a move Hymans Robertson warned could lead to a likely capacity crunch as fiduciary managers will struggle to respond to all tender requests.