UK: Pension scheme advisers avoid break-up

The three largest investment consultant firms to the UK’s £1.6 trillion (US$2.1 trillion) pension fund industry face tougher rules and mandatory tendering, but have escaped a forced break-up after a probe by the competition watchdog, reported Financial Times.

The so-called “big three” of Mercer, Willis Towers Watson, and Aon had feared they could be forced to spin off either their investment consultancy or fiduciary management businesses—a type of asset management service—after the Competition and Markets Authority (CMA) launched a probe into the sector last September.

The CMA on Wednesday, July 18, however, decided against a break-up, despite warning of an “adverse effect on competition” in the sector that could cause a “material customer detriment.”

The provisional findings mark a significant moment for the institutional advice sector, which has largely flown under the radar of regulators despite advising UK pension funds, insurers and charities on how at least £1.6 trillion (US$2.1 trillion) of assets should be invested.

Full Content: Financial Times

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