On the go: The Competition and Markets Authority has approved a performance measurement standard to be used by fiduciary management providers.
The Global Investment Performance Standards were developed by CFA Institute to allow fiduciary providers to demonstrate historical returns in a clear, standardised format when pitching to new clients.
It followed the CMA’s review of investment consultants and fiduciary managers, which called for a homogenised performance reporting standard to be made available to clients.
The GIPS are aimed at fiduciary managers providing advice and investment implementation services to pension schemes, whether for all or part of the plan’s portfolio.
In a statement, CFA Institute said it was working on “a variety of educational resources” to support trustees through tender processes as they start to receive GIPS data.
Since December 10, UK pension scheme trustees must run a formal tender for any fiduciary mandate outsourcing more than 20 per cent of assets. Those that have already outsourced to a fiduciary must retender the mandate within five years.
Karyn Vincent, senior head of global industry standards at CFA Institute, said: “Prospective and existing clients of fiduciary managers benefit from an investment performance standard by having a greater degree of confidence in the information presented to them.
“The GIPS standards… will provide pension scheme trustees with greater transparency and comparability of fiduciary managers’ historical investment performance through a single standard for calculating and presenting performance data.”
Vassos Vassou, professional trustee at Dalriada Trustees, said the GIPS would “help make performance more transparent, making it easier for a trustee to compare apples with apples”.
“This is particularly important now, as trustees are about to embark on a major exercise running fiduciary manager supplier reviews in accordance with the CMA’s recommendations,” Mr Vassou added.
“There will be one less complication for trustees seeking to identify the best fiduciary manager for their schemes.”
Gary Baker, managing director for Emea and industry and policy research at CFA Institute, said: “Confidence in the reliability and comparability of performance data is a foundation stone to informed investment decision-making. CFA Institute, through the GIPS… is delighted to be contributing to this key provision.”
