FCA on target with consultant scrutiny, says BrightonRock’s Keating

first_imgSpecialist fiduciary management provider SEI has called for investment consultants to be required to sell or ring-fence their fiduciary management services to combat conflicts of interest. Keating, while impressed by the FCA’s work overall, said the report fell just shy of getting to the heart of how the business model of the asset management industry needed to change.“They did miss one big opportunity,” he said. “They almost got there but not quite.”He said the FCA had found that some fund managers underperform considerably but do not appear to get terminated, and that, for him, “the real [issue] is that the relative game will get more and more pressured by passive players”.Describing the asset management industry as “a relative game about divisions of a fixed-sum pie”, Keating said this explained why it was “virtually impossible to maintain a leading position”.He said investment managers needed to be more pro-active than they have been.“They have to start looking at working with their investee companies,” he said, adding that pension investors with in-house managers, such as the Canada Pension Plan Investment Board and Australian Super, were the “furthest advanced” along the lines of that business model.“That idea is where the future of the fund management industry has to lie,” he said.Greater disclosure of costs and fees in the fund management industry will only exacerbate the trend towards passive, he said, “so the smarter fund managers will move away from that business model of trying to outcompete their neighbour and go elsewhere”.Keating has elsewhere referred to the model he proposes as a co-operative, collaborative model of direct involvement, where fund managers, as per the descriptor, “co-operate and collaborate with their investee companies to improve the long-term performance of those companies – and with that, their own value and investment performance”.The approach Keating described is said to have echoes of one adopted by some large European pension investors in recent years, to the extent that it has parallels with a shift to more concentrated equity portfolios based on higher-conviction active investing.The UK’s Universities Superannuation Scheme is moving in this direction, for example.Where the FCA “didn’t do anywhere near enough”, Keating said, was on “systematic efforts” to misrepresent fund management performance.“They have been quite remarkable at defending their turf, and truth doesn’t necessarily have to enter their defences,” he said.Keating strongly criticised a report by the Investment Association earlier this summer in which the industry body hit back at claims of high hidden fees charged by fund managers. The FCA has proposed an “all-in fee” for investment funds in addition to other requirements on asset managers to demonstrate value for money to investors.Keating said he thought the all-in fee was a good idea.“What we really do have to see is transparency,” he said. The UK Financial Conduct Authority (FCA) delivered an impressive study on the asset management market, asking “serious questions” about investment consultants and fiduciary management, according to Con Keating, head of research at BrightonRock, an insurance company for pension schemes.Keating said the FCA delivered “a very good piece of work”, including with respect to how “they went after investment consultants” and touched on the “very important point” that the quality of their advice has never been able to be measured.He said the FCA’s report “asks some really serious questions” about investment consultants’ move into fund management via fiduciary management and that there was “a very very strong case” to be made that these should be separated.“Either you’re an investment consultant or a fund manager, but you cannot be both,” he said. “I really do think there should be a clear division between fund management and consultancy services.”last_img read more

LIVE: Trump reacts to Mueller report

first_imgFollowing Attorney General Barr explosive press conference ahead of releasing the Mueller report, President Trump is making remarks at a White House event with the Wounded Warrior Project.last_img

Update on the latest sports

first_imgThat’s the word from manager Dave Martinez, who says surgery could be an option but adds he has yet to talk with the 2019 World Series MVP. Strasburg was put on the injured list on Aug. 15, a day after he recorded just two outs at Baltimore. After going 18-6 with a 3.32 ERA in 33 starts in 2019, the right-hander is 0-1 this season with a 10.80 ERA in two starts.In other MLB news:— Slumping Chris Davis has been put on the 10-day injured list by the Orioles, who recalled highly touted prospect Ryan Mountcastle and put him in the starting lineup against Boston. Davis headed to the IL with a .122 batting average and patellar tendinitis in his left knee. COLLEGE ADMISSIONS-BRIBERYLoughlin, Giannulli get prison time in college bribery plotBOSTON (AP) — Lori Loughlin and fashion designer Mossimo Giannulli have apologized for using their wealth and privilege to bribe their daughters’ way into the University of Southern California as crew recruits.Accepting plea deals struck in May after the pair admitted paying $500,000, a judge sentenced Loughlin to serve two months behind bars while Giannulli was sentenced to five months.Prosecutors say the couple funneled money through a sham charity to get their two daughters into USC as crew recruits, even though neither was a rower. Amazingly, he is two shots behind leader Dustin Johnson, who finished with a 60 and is at 15-under. PGA-MICKELSONMickelson eliminated from FedEx Cup, now to try ChampionsNORTON, Mass. (AP) — Phil Mickelson has missed the cut at the Northern Trust and is all but assured of being outside the top 70 who advance to the BMW Championship next week south of Chicago.Instead, Mickelson said he would make his debut on the 50-and-older circuit at the Charles Schwab Series at Ozarks National. Mickelson turned 50 in June. Associated Press WOMEN’S BRITISH OPENHolmqvist leads British OpenTROON, Scotland (AP) — Dani Holmqvist braved the wind-swept links at Royal Troon to take the lead through two rounds of the Women’s British Open. Holmqvist shot 1-under 70 in windy morning conditions to be the only player under par after 36 holes.A 1-under total of 141 left Holmqvist a stroke ahead of American Austin Ernst and Sophia Popov of Germany. First-round leader Amy Olson shot 81, 14 strokes worse than Thursday. Stars like Lexi Thompson, Brooke Henderson and defending champion Hinako Shibuno missed the cut. — The Phillies have acquired right-handed reliever David Hale from the Yankees to help their league-worst bullpen. Hale has appeared in 95 games over six seasons with the Braves, Rockies and Yankees. — The Royals placed catcher Salvador Perez on the injured list with lingering vision problems and recalled Randy Rosario to add a left-handed arm in the bullpen. Perez woke up with vision problems Sunday.NFL-NEWSWashington coach diagnosed with cancerUNDATED (AP) — Washington football coach Ron Rivera has been diagnosed with a form of skin cancer. A team spokesman confirmed Rivera has squamous cell carcinoma. The 58-year-old is expected to continue coaching while undergoing treatment. Share This StoryFacebookTwitteremailPrintLinkedinRedditNBA SCHEDULERaptors trounce Nets for 3-0 series leadLAKE BUENA VISTA, Fla. (AP) — The defending NBA champs are on the verge of sweeping their first-round series. In other NBA playoff action:— The Jazz are up two games to one in their NBA first-round series after blowing out the Nuggets, 124-87. Mike Conley made a career playoff-high seven 3-pointers and scored 27 points in his return from quarantine. Rudy Gobert (goh-BEHR’) grabbed 14 rebounds and had a career playoff-high 24 points courtesy of numerous easy dunks and layups. Nikola Jokic (nih-KOH’-lah YOH’-kihch) had a team-high 15 points for the Nuggets, who tied the third-worst playoff loss in team history.MLB NEWS-NATIONALS-STRASBURGStrasburg might require surgeryUNDATED (AP) — Washington Nationals pitcher Stephen Strasburg has been diagnosed with carpal tunnel neuritis on his throwing hand after seeing a nerve specialist. center_img PGA TOUR CHAMPIONSBertsch eagle gives him Schwab winRIDGEDALE, Mo. (AP) — Shane Bertsch eagled the first hole of a four-man playoff to win the Charles Schwab Series in Missouri.Bertsch hit an approach from the rough near the back edge of a bunker that took some big bounces in front of the green. It rolled to 20 feet from the back pin on the par-5 first hole, giving him a victory in his second PGA Tour Champions start.Glen Day, Bernhard Langer and Kenny Perry shared second, one stroke ahead of Tom Byrum and Vijay Singh (VEE’-jay sing). The Toronto Raptors have a three-games-to-none lead for the first time in their history following a 117-92 dismantling of the Brooklyn Nets.Toronto never trailed and led 57-42 by halftime. Pascal Siakam (see-A’-kam) scored 26 points and chipped in eight rebounds and five assists. Fred VanVleet shot 6-for-10 from 3-point range and finished with 22 points. Serge Ibaka (ih-BAH’-kah) had 20 points and 13 rebounds, while Kyle Lowry had his own double-double with 11 points and 10 boards.Tyler Johnson had a team-high 23 points for the Nets.Game 4 is Sunday. August 21, 2020 In other NFL news:— Wide receiver Tyreek Hill has only a minor hamstring strain and the Chiefs intend to be cautious with their dynamic playmaker. Wide receiver Sammy Watkins was back for the first time in nearly a week along with Pro Bowl defensive tackle Chris Jones. Both of them had groin strains.— Bills cornerback Josh Norman is out indefinitely after hurting his left hamstring in practice. Coach Sean McDermott couldn’t provide a timetable on time Norman will miss, in saying the team is still determining the severity of the injury. — Seahawks cornerback Quinton Dunbar says he understands he could still be punished by the NFL even after armed robbery charges against him in Florida were dropped. Dunbar declined to speak in detail about what led to him being arrested and charged in Broward County, Florida. — The league has hired Jonathan Beane as senior vice president and chief diversity and inclusion officer. He serves on the Board of Directors of GLAAD and has held senior diversity roles at Roche, 21st Century Fox and Time Warner, among others. The league said Beane will “spearhead diversity, equity and inclusion strategy, and will collaborate with senior leadership to drive actionable change” throughout the NFL. PGA-NORTHERN TRUSTBlazing hot rookieNORTON, Mass. (AP) — PGA Tour rookie Scottie Scheffler has become the 11th player to shoot a 59 or better in Tour history.The 24-year-old from Texas made a birdie putt from just outside 4 feet on the last hole for a 59 in The Northern Trust. He played bogey-free at the TPC Boston and finished with four birdies over his last five holes. Update on the latest sportslast_img read more