A good week for transparency

chris sier


It’s been a good week for transparency, with the FCA’s publication of the IDWG’s final report. 

Chris Sier and his team have created the opportunity for investors to properly understand the total cost of intermediation when buying assets through a fund.

On the same day, (November 7th 2018) , the PLSA, the Investment Association and the LGPS established CTI – a Cost Transparency Initiative. If you follow this link and visit the CTI website, you will ind the links to the IDWG templates themselves.

It is right that Chris Sier’s work is put in the hands of the CTI, The PLSA and IA organisations with the budget and human resources to follow through on their stated aims.


The CTI will:

  • Provide a clear voice for the interests of asset owners as we improve cost transparency.

  • Run a pilot phase to test the new cost transparency templates and supporting technical and communications materials until January 2019.

  • Following the pilot, roll-out the templates to the asset management and pensions industries to encourage fully transparent and standardised cost and charge information for institutional investor


No room for complacency

The adoption of the templates needs to be (in time) universal, there will be an initial 12 month period where the templates are trialled but the hope is that by the end of next year, the templates will be part of the “business as usual” reporting processes of fund managers to asset owners, fiduciaries and advisers.

Getting this done is far from certain. It will take another effort , as great as the work of the IDWG to get adoption. But it’s encouraging that Sier has already established a utility that he calls Clear Glass that can be used by interested parties to get data and make use of it.

No doubt it will not be the only such utility, but it is apparently really for use and as Clear Glass has been set up on a not for profit basis, it represents another step towards achieving the aims laid out above.

Why this matters

Without the line by line reporting of costs incurred, investors will continue to be left in the dark.

Without scrutiny lax practices can creep into the execution of trades, conflicts can remain unresolved and fraction by fraction, the fund management industry can increase its profits, not by being better, but by getting away with worse.

Thomas Phillipon, the American scholar, has shown that the funds industry has an extraordinary capacity to fill a vacuum left by the reduction in costs, by inserting more costs. Whether there is a conspiracy against investors – I very much doubt. But history tells us that whatever value the fund management industry brings, is too easily dissipated in the money it charges.

The publication of the  vigorous work of Dr Sier and his colleagues, the establishment of the CTI and the emergence of Clear Glass, all in one week – is a great step forward for transparency.

A tip of the hat to the Transparency Task Force

Whether all this happened because of Andy Agethangelou’s perseverance, cannot be proven. But it is very clear that the persistency with which Andy has called for the measures we now see enacted , cannot but have helped.

It is easy to sneer and call the TTF a talking shop, but it is more than that. At the meeting of the TTF we attended this week, we heard from Alan Miller and the True and Fair Campaign, from European and American campaigners and we heard from Chris Sier himself.

Bringing these disparate campaigners together under one roof (thanks Dimensional) is in    itself an achievement. The TTF has created a positive and consensual platform for much that is happening.

The evolution of ideas into action

Many congratulations then to all involved in getting these positive actions in place.

There is no room for complacency, the foot must continue to be on the accelerator.

The impact of this work will be a better deal for all investors  – this matters.

This is the industry cleaning itself – something which we can be commended for.

How good it is to write that!

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in pensions, Value for Money and tagged , , , . Bookmark the permalink.

Leave a Reply