The PLSA investment conference is over and I am returning to London by train. I’m surprised that so many delegates took the plane, perhaps TCFD doesn’t include the people recording it.
I’m surprised too that Fred Berry and Sarah Pritchard of TPR and FCA were not given more attention when they explained the reasons for their search for a meaningful way of judging value for money.
— Josephine Cumbo (@JosephineCumbo) May 26, 2022
Judging by the amount of alcohol being consumed over the two days in the exhibition hall, I suspect that those asset managers on their stands had little capacity to make it up the labyrinthine stair cases to the speaking events. They may be able to use their recovery time from last night’s gala dinner to read the feedback on their consultation on measuring value for money in defined contribution pensions.
Perhaps emboldened by Stuart Kirk, the asset managers I spoke to considered the thought of having to submit data to third parties to be measured for the quality of their work quite beyond the pale. But that is the sorry experience of their Australian counterparts who are fast waking up to the reality that consumers, once they have a bit of money in their pots, are likely to want some proper information about what’s happening to it.
If they and the PLSA put two and two together, they might wake up to the implications of pension pots being accessible and comparable on pension dashboards. It is only a matter of time before some bright spark invent a way for regulators, employers and savers to compare how funds are managed by using the member’s data to tell them what is actually going on.
Asset managers and their marketing departments have lived a charmed life for too long and it really is time that they started to pull their fingers out. That means coming into line with what the Pensions Regulator , FCA and DWP are asking for – proper information such as price tracks , price swings , transition costs and risk adjusted performance metrics so that people who do care about value for money, can get on with assessing it!
And there are signs that the regulators are finally getting somewhere. Sarah Prideaux explained that it was not enough for IGCs to blithely wave through workplace pensions with a clean bill of health, VFM is relative and relative to meaningful benchmarks, not whatever takes an IGCs fancy. As for Trustee value for member statements , they didn’t even get a mention but their were stern warnings from both regulators that bioinformation needed to be made available to members as suited members and not their fiduciaries.
The sight of the FCA’s Executive Director of Markets explaining why they are considering using Tic-Toc and Instagram to get the VFM message out, gave me great pleasure. The sight of the looks of mystification in the audience gave me even more!
And anyone who thinks that once we have digital dashboards , that will be it, should have another think coming. The empowerment of the consumer to find things out hem or herself starts with the dashboard, but is likely to be the door to much more!
So it’s really up to the investment community to climb a few stairs, pay a little attention and start providing solutions. VFM could make TCFD look like a doddle.