It was a glittering night at the Sheraton Park Lane Hotel for the Pension and Investor Provider Awards. The event was hosted by Channel4 newsreader Alex Thomson, who kept the many luminaries from the world of pensions and investments entertained with enthralling and witty anecdotes of live broadcasting and foreign assignments.
The following is an account of all the winners, interspersed with some of the comments the judges made during the judging process.
The judges for the investment provider awards were as follows:
Nick Adams, Henderson Global Investors; Jonathan Clarke, an independent trustee; Emma Douglas, BlackRock; Chris Edge, AllenbridgeEpic; Simon Freeman, Pendragon; Mark Gull, Pension Corporation; Stephen Holt, Principal Global Investors; Steve Mingle, Isinglass Consulting; Terry Malley, Credit Suisse.
The judges on the scheme services were:
Tony Barnard, Gissings; Jane Beverley, Punter Southall; Lesley Carline, Xafinity Paymaster; Paul Charles, Isinglass Consulting; Frank Curtiss, RailPen; David Gallagher, Field Fisher Waterhouse; Steve Herbert, Origen; Karen Hoodless, KHPMC; Jerome Melcer, Lane Clark & Peacock; Terry Monk, Independent Trustee Services; Jarrod Parker, Alexander Forbes Services.
INVESTMENT PROVIDERS
ACTIVE ASIA-PACIFIC EQUITIES
Winner: Fidelity International
Commended: Threadneedle
This was a competitive category, where the judges had a high expectation of strong performance figures. However, Fidelity was the clear winner, with consistent performance, a large and expanding team and a clear commitment to the region.
“Fidelity have got very good performance over all time periods, so that they were the clear winners for me,” said one judge.
“I like the fact they said they’re increasing their resources because there’s more stocks to cover in the Asian markets, so there was a bit of rationale behind what they’re doing. And they’re setting up satellite offices in the region so they can have increased focus at the domestic level and provide better service as well.”
Runner-up was Threadneedle for delivering good performance and showing a commitment to service delivery.
ASSET ALLOCATION
Winner: Schroders
Commended: London & Capital
With £1.4bn in assets managed in this strategy, Schroders has demonstrated strong performance, commitment and an ability to tailor solutions to suit the client’s needs.
“What I liked about Schroders was that they would use their in-house products, but where they don’t think it is best-in-breed, they will happily go out to other people,” said a judge.
London & Capital was commended for a strong submission focusing on performance, innovation and service, with an offering that would be of particular interest to smaller schemes.
CURRENCY
Winner: Putnam Investments
Commended: Alliance Bernstein
Currency was a strongly contested category, with the contenders very close. Putnam came top for consistent performance, for being strong on innovation, while on service they were considered to be giving the five-star treatment to their clients.
“Putnam weren’t the best at performance, but they had consistent performance and beat their index six out of seven years. More telling I think is that they won over £1.5bn in new mandates last year, so clearly they’ve got the bulk of their work with the consultants and the clients,” said a judge.
ACTIVE EUROPEAN EQUITY EX-UK
Winner: Neptune Investment Management
Neptune has demonstrated consistent high performance over the medium term, and a taste for innovation.
“Their performance figures were very good: 16% for one year, 31% for five years. Very much the subtext of this submission is that they just basically choose things and hang on to them.”
There was no runner-up in this category.
FUND-OF-HEDGE FUNDS
Winner: RMF Investment Management
Commended: Morgan Stanley Investment Management
RMF Investment Management demonstrated a strong degree of innovation in environmental investment and in their emerging managers fund, which helped to nudge them ahead into first place.
“RMF has launched a couple of interesting funds in the last year, including an environmental opportunities fund, investing in things like clean tech, renewable energy, carbon emissions and the like,” said a judge.
The judges also liked Morgan Stanley’s consistent double-digit returns since inception. Its very low correlation and volatility and a good focus on performance for clients.
ACTIVE GLOBAL EQUITIES
Winner: Neptune Investment Management
Commended: Investec Asset Management
This was a well-supported category with strong submissions across the board. Neptune was the winner for demonstrating consistently good performance figures with a strong emphasis on service.
“Neptune had the overall strongest performance, and again very good service – a boutique service. Again, when things have turned down they haven’t done quite so badly.”
Investec was commended for consistent information ratios, tracking and behavioural finance.
HIGH ALPHA EQUITY
Winner: BlackRock
Commended: Neptune Investment Management
BlackRock’s UK fund has been a consistent performer, is genuinely unconstrained and relies very heavily on fundamental research with a good track record.
HIGH YIELD BONDS
Winner: Royal London Asset Management
Commended: Legal & General Investment Management
Royal London demonstrated excellent performance and has won considerable new business. The judges praised its clear and client-friendly approach.
“Clients seem to like Royal London; their process is fairly clear and traditional, so easy to understand.”
LIABILITY-DRIVEN INVESTMENT
Winner: Insight Investment
Commended: BlackRock
Insight Investment’s submission was exceptionally strong, with a heavy focus on quality of service and trustee education, and excellent examples of its range of services. Insight is the winner for the second year running.
“I thought it was an exceptionally strong submission; big focus on quality of service and trustee education,” said one judge.
BlackRock – last year’s runner-up – was again commended for a very impressive submission.
MANAGER-OF-MANAGERS
Winner: Insight Investment
Only one provider shone out, and that was Insight Investment.
“Insight was succinct in setting out what their benchmark was and generally were pretty clear in terms of what they were up to,” said a judge.
MONEY MARKET FUNDS
Winner: Morley Fund Management
Commended: Fidelity International
This is always a difficult category to judge, but the acid test proved to be performance. Morley, despite a tough environment in 2007, had good performance across a range of funds. Its submission also showed a focus on UK pension fund clients.
“The combination of the performance in 2007 – which was a tough environment for money markets – and the focus of the product range on the UK pension funds swung me in their favour.”
Fidelity was commended for demonstrating a degree of consistent added value and evidence of innovation.
ACTIVE NORTH AMERICAN EQUITY
Winner: Neptune Investment Management
Things have been tough in this market, but Neptune has had good performance figures for 2007. Neptune convinced institutional investors that it could work with them and while they invested $84m (£43m) in 2007, it already has three times that amount committed for 2008.
“Their performance over one year is absolutely stellar and that has acted to really boost the three and five-year numbers, which still would have been better than benchmark. They did 29% in 2007 compared with an S&P 500 Index of less than 4%.”
OVERSEAS FIXED INCOME
Winner: Goldman Sachs
Commended: Alliance Bernstein
Goldman Sachs had a pretty good 2007, increasing assets by 30%, winning many new clients and delivering good performance, with what was considered cutting edge service.
“Goldman Sachs has got this very fancy-looking global fixed income risk factor model, which is a good risk tool,” commented one judge.
“They are pretty cutting edge in trustee learning, servicing, consultants, industry conferences, writing research papers, pocket guide to derivatives. I put them first by some margin.”
There were some notable omissions from this category, which the judges put down to a difficult year in this sector.
Alliance Bernstein was the runner-up.
OVERSEAS PROPERTY
Winner: Prudential Property Investment & LaSalle Investment Management
Commended: Morley Fund Management
With relatively short performance periods, the clincher in this category was innovation, in which the PruPim and LaSalle joint venture shone.
“The most innovative thing I’ve read, and I liked their approach very much. They seem to be targeting Asia-Pacific in a unique way and it does seem to suggest they are doing a good job there.”
Impressive submissions from the entrants made it difficult to separate the providers, but Morley was also commended for its submission.
QUANTITATIVE INVESTMENT
Winner: Intech
Intech showed excellent and consistent performance, combined with innovative methods for maintaining low costs and the launch of products specifically for UK clients.
“There’s been a lot of press coverage around quant processes suffering in 2007, but Intec were nearly 3% up over the year.
“Their innovation was focused on low trading costs, apparently on bottom decile in that area, which saves them costs and boosts performance.”
SUSTAINABLE/ETHICAL INVESTMENT
Winner: Aberdeen Asset Management
Commended: Insight Investment
Performance was a key criterion in this category and thinned the field early on.
Aberdeen Asset Management had good performance over both the short and long term and it also showed innovation in screening methods, with a new fund launch, flexibility for segregated clients, and real commitment.
“Aberdeen can offer very good flexibility on screening for segregated clients, so it can pick out the bits that clients really don’t want to have in their portfolios. And it’s also got proper global resources as well – there’s a real global team there.”
ACTIVE UK EQUITY
Winner: BlackRock
Commended: Morgan Stanley Investment Management
BlackRock’s performance has been very strong over a number of time periods and they ticked all boxes in innovation, service and competitive edge.
“BlackRock have what they call mainstream, which is an approach to redefining risk controls away from active versus index weightings. They’re focusing very heavily on risk, on the share of risk per individual stock within the portfolio, so that no one stock or sector or style is greater than 10% of the active risk, and I quite like that.”
Morgan Stanley was runner-up, demonstrating good performance and high service levels.
UK FIXED INCOME
Winner: Royal London Asset Management
Commended: Barclays Global Investors
Royal London provided the most comprehensive submission, which showed excellent long-term performance across its fund range, attracting £2bn in the past year. It also displayed clear innovation in launching an ethical bond fund.
“Royal London’s level of disclosure was excellent; they pretty much covered their whole range of funds. Their performance over the last year has been extremely good in gilts and slightly weak in credit, but over the long term it’s very, very good pretty much across the board.”
The runner-up – BGI – was commended for showing clear evidence that it has made significant advances in its process, with new models, new long/short strategies and an extensive use of derivatives across a very comprehensive service offering.
UK PROPERTY
Winner: Henderson Global Investors
Commended: BlackRock
Henderson demonstrated strength and depth across all sectors, with a strong spread of expertise and a wide range of funds, most of which show good performance figures.
“Henderson was an early mover in applying asset management techniques to property investment, and others have obviously now followed suit, but it comes across that it’s got strength and depth across all sectors, very professional, good long-term record, strong spread of expertise, good global presence, wide range of funds, almost all of which have got sound and good performance numbers,” said one judge.
BlackRock was commended for an excellent submission and its innovation in areas such as leisure parks and marinas.
SCHEME SERVICES
ACTUARIAL CONSULTING
Winner: Lane Clark & Peacock
Commended: Mercer
Lane Clark & Peacock demonstrated not only performance, with 70 new business wins and a focus on training and client care, but also articulated an honesty and passion for the work which the judges found compelling.
“LCP’s presentation was dramatic, it just leapt off the page at me. It listed over 70 new business wins. There was a high focus on training and client care came over very, very strongly.”
The runner-up was Mercer, which was chosen for its clear exposition and strong client testimonials.
BULK BUYOUT
Winner: Paternoster
Commended: Legal & General Investment Management
Paternoster was judged to have made an outstanding entry, that focused not only on the large number of business wins and operational challenges, but also focused on service in terms of looking after the member.
“Paternoster’s presentation was packed with incredible detail. It was very clear on the kinds of innovation they’ve got on offer, such as predictive reporting and clear communication for scheme members. There were plenty of helpful testimonials,” one judge said.
Legal & General came a very close second, as the judges felt the winner had done more to innovate, in almost single-handedly driving change in this particular market.
COMMUNICATION SPECIALIST
Winner: Hewitt Associates
Commended: PensionsDCisions
Getting the message across can greatly enhance the position of a scheme, so doing more than passing on bad news has a real impact on the members’ perception. Hewitt were named the winners for their all-round innovation, delivery and service.
“They talked about online communications, which is good, but they were brave enough to stop their clients going and saying ‘I want a website, we’ve got to have a website, because everyone says you’ve got to have a website’, which effectively becomes useless because no one uses it.
And what they’ve done is they’ve created a tool, a free tool, for their prospective clients to go online and model what they want out of a website.
And that was just one of the examples of their innovation.”
PensionsDCisions is not really a communication company, but its new approach to modelling defined contribution (DC) schemes and provision of information goes much further than benefit statements, and is driving real change at schemes.
DC (BUNDLED SERVICES)
Winner: Prudential
Commended: Legal & General Investment Management
Bundled DC providers have to be a jack of all trades and if trustees have their way, masters of all, too. Fund performance, administration and communication all have to be blended to deliver what is expected of them.
Prudential demonstrated a comprehensive offering that offered employers strength in depth.
“Prudential were way ahead of the pack and strong in all areas,” said one of the judges.
Legal & General was commended for its innovation in the development of group pensions.
DC (INVESTMENT ONLY)
Winner: Black Rock
Commended: Fidelity International
Black Rock was adjudged to be leading the pack in terms of innovation in developing new funds and methods to lock in good performance, something that DC members may prove to be very thankful for in the long term.
DC investment is under close scrutiny from the Pensions Regulator, so picking the right funds is going to be increasingly important in the future.
“The jewel in the crown is really this target-driven investment concept, which they’d picked up and run with and no one else seems to be anywhere near as evolved as they are on that.”
EMPLOYEE BENEFIT CONSULTING
Winner: Mercer
Commended: Hewitt Associates
Mercer demonstrated excellence in all key judging criteria, but also for its work on governance.
“One of the things that I like about them is their ability to work with the employee around provider selection, even when they might be in the frame themselves. They even got testimony from a client that no undue influence was exerted and this reinforced the confidence that Mercer were professional,” said a judge.
Hewitt was commended, just nudging Lane Clark and Peacock into third, who although not placed deserve an honourable mention.
FLEXIBLE BENEFITS AND TOTAL REWARD
Winner: Thomsons Online Benefits
Commended: Vebnet
Much has been talked about the introduction of flexible benefits over the past decade, but it is only with the move towards DC schemes and a desire to offer more flexible reward packages, that it seems likely to come into its own.
Thomson Online Benefits was praised for improving process management, tailored campaign marketing tools and its holistic approach.
“Thomson has gone to town in improving process management and payroll cut-off dates and efficiency. It sounds very technical to me, but I suspect it’s vital to a payroll manager. It has a very strong payroll function. As a former internal auditor, that is important to me. Although it may be dull and technical, the more they can do to make their control effective and visible is a good thing for the client and its auditors.”
VebNet was commended for a strong showing that demonstrates how they are servicing a growing demand.
GLOBAL CUSTODY
Winner: Northern Trust
Commended: State Street
If ever there was a job within the world of pensions that no one is very concerned about until something goes wrong, it is custody.
Excellent client testimonials lent strong support to Northern Trust’s nomination as the winner.
“In terms of innovation, I thought Northern Trust came out highest. Not only did they say ‘we have this product’, but also they gave examples of how they were actually doing it in practice.”
Among a range of high quality submissions, State Street was named runner-up.
INDEPENDENT TRUSTEE
Winner: Independent Trustee Services
Commended: Capital Cranfield Trustees
Some strong submissions in this category made it difficult for the judges.
However, Independent Trustee Services emerged as the winner for its work with the Financial Assistance Scheme, glowing client testimonials and its desire to improve the base of trustee confidence.
“They talked about their website, but said a lot of people don’t just like websites, they want letters; they want a newsletter as well. So it was actually giving the whole picture.”
The judges commended Capital Cranfield for its sensitivities towards the sponsoring employer, innovations in overseeing the bulk buyout and ongoing development.
INVESTMENT CONSULTING
Winner: Lane Clark & Peacock
Commended: Xafinity Consulting
Lane Clark & Peacock focused on the importance of communications at all levels and ensuring trustees understand. This was allied to good tools, quality staff and research and backed by testimonials.
“They did not make a big play on deserving to win work because they had masses of support staff; rather they emphasised good quality support staff and research,” said a judge.
Xafinity Consulting was commended ahead of larger providers for its clear and concise submission with a clear focus on trustee understanding. It was felt by the judges that small to medium sized schemes would find its approach a great comfort.
PENSIONS ADMINSTRATION SOFTWARE
Winner: Xafinity Claybrook
Commended: Aquila Heywood
Xafinity Claybrook’s claims of strong service were backed by a client survey in which 95% of clients said it was a pleasure to work with them, while 90% cited high quality as a core value of the business.
“Xafinity talked very much about the web access, but also stressed that web access is not just for members, but also for trustees,” one judge said.
Aquila Heywood was seen by the judges to run a very close second to Xafinity.
PENSIONS LAW FIRMS
Winner: Sacker & Partners
Commended: Linklaters
Sacker & Partners’ innovative approach to dealing with M&A and bulk buyout made them the winners.
“One of the things that came out from their submission was enthusiasm; they talk about enjoying being at the centre of things. They talked about trustee plans that may be at risk of takeover actually having contingency plans in place in advance, and so I felt that they were very much taking advantage of developments in the market and being innovative.”
Linklaters was commended for a comprehensive service that included online provision of governance documentation and strong European competencies.
THIRD PARTY ADMINISTRATION
Winner: HS Administrative Services
Commended: Xafinity Paymaster
This year’s winner, HS Administrative Services – last year’s runner-up – was praised for a concise submission that clearly placed emphasis on how it works with the client on a personal basis.
“They kept going back to keeping the costs low and how they were achieving that, which certainly scored quite highly. They sounded like they believed in their product too.”
Xafinity Paymaster was highly commended for its excellent entry.
TRANSITION MANAGEMENT
Winner: Barclays Global Investors
Commended: State Street
BGI were the winner by a close margin, decided by their commitment to service.
“The reason BGI edged it was that they actually explained what process they put in place when they take somebody through a transition. And they were much clearer on what sort of back-up strategies they had in place, so they very much edged it for me on that.”
State Street was commended for an excellent submission.
