Press Release

IMA welcomes greated transparency for pension fund trustees

1 October 2008

The Investment Management Association (IMA) welcomes guidance by the The Pension Regulator, published today, on conflicts of interest, which informs pension trustees that they should require the same level of conflict disclosure from external consultants as with regulated asset managers; this will better protect both trustees and the beneficiaries of their schemes.  IMA supports the proposal that external consultants should disclose conflicts proactively and not await requests from trustees.

Consultants to pension schemes are able to fulfil various roles, including offering fund management services. The issue is that consultants offering both fiduciary and commercial services have an obvious potential conflict of interest. In particular, where a consultant advises clients on fund manager selection and monitoring, there is a clear conflict if they are also promoting their own fund management services. Today's guidance should ensure that pension fund trustees automatically receive the information they need about the conflicts that could affect their advisers.

Commenting, Richard Saunders, Chief Executive at the IMA said:

"Up until now, there has been no regulatory oversight of how consultants to pension fund trustees recognise, manage and disclose conflicts of interest. It is therefore most welcome that The Pensions Regulator has introduced guidance which will promote greater transparency and so ensure pension funds are better served by all their advisers."