The UK fiduciary management market has grown with around 40 per cent compared to last year and currently stands in excess of £23bn, or over 2.4 per cent of total UK pension assets under management, and is distributed across 174 pension schemes, a survey by KPMG has found.

These numbers only take into account full delegation mandates, which KPMG believes can unambiguously be defined as fiduciary management. A further £30bn is managed on a partly delegated basis across 120 mandates.

Only three full delegation mandates are greater than £1bn, whereas around 88 per cent of the full delegation mandates are below £250m, with implemented consultancies managing 80 per cent of these appointments. For larger mandates, asset managers and specialist providers have a larger market share, but due to the limited number of competitive selections, implemented consultancies still hold a majority market share in this section as well.

The partly delegated market has grown with 11 per cent year on year, with investment consultants holding 90 per cent of appointments and 80 per cent of market share.

KPMG head of fund manager research Alex Koriath said: “We do not see partial delegation as being consistent with how most observers would define fiduciary management. Instead, we see it as asset management services that range from multi-asset, fund-of-fund to multi manager strategies. These services are being performed in greater AUM sizes by many asset managers who rightly do not try to label them as fiduciary management.”

Partner and head of investment advisory Patrick McCoy added: “It’s good to see the fiduciary market growing as it provides more choice for pension schemes. This market growth has been dominated by the consultants converting their existing consulting client base. From speaking to a lot of pension funds, I know they are keen to see evidence that the fiduciary model is working before considering it further and in particular which of the providers have been successful.”

Share Story: