The 5% of UK Defined Benefit Schemes now use fully delegated Fiduciary Management (FM), representing 3.4% of DB assets.
KPMG’s 2014 UK Fiduciary Management Market Survey
KPMG finds that the UK Fiduciary Management full delegation market grew by an astonishing 44% in number of mandates from 2013 to 2014 – but that 75% of these mandates were won on an uncontested basis (i.e. no tender process).
The release of KPMG’s 2014 UK Fiduciary Management (‘FM’) Market Survey results highlights three core issues in the FM fully delegated market:
- The market is still growing at an incredible rate, although in 2014 this was driven by new market entrants (growth was 16% excluding new entrants);
- At over 75%, the number of mandates won without a competitive tender process remains uncomfortably high; and
- There is still a regrettable absence of investment performance data for the FM industry, which we feel fiduciary managers could and should do more to address.
More information on KPMG fiduciary management advisory services’.
The UK FM Market Summary
What are the key trends in the UK Market?
- 5% of UK Defined Benefit Schemes now use fully delegated FM, representing 3.4% of DB assets.
- There are now over 300 fully delegated mandates in the UK, representing 44% growth over the year and £38bn in assets.
- Investment Consultancies saw the largest increase in mandates.
- 89% of mandates have less than £250m in assets, showing that the solution continues to appeal to smaller pension schemes.
- Larger schemes are more likely to use an ongoing independent advisor to support the FM structure, with over 60% of schemes larger than £500m appointing an advisor.
- Trustees are increasingly comfortable in delegating larger portions of the scheme to fiduciary managers