Mercer launches investment governance assessment

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Mercer, UK, investment governance tool, trustees, Rachel Brougham, pensions


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Contact: Mags Andersen
Tel: +44 20 7178 3513

Mercer launches investment governance assessment service for trustees

UK
London, 21 October 2009

Mercer has launched an investment governance assessment service to help trustees review their investment governance arrangements and compliance with the Myners principles. The service comes as part of the firm’s drive to help trustees respond to the challenge of the increasing complexity of financial markets and combines expertise from its investment and governance consulting businesses.

Rachel Brougham, a principal in Mercer’s governance consulting team, said: “Investment strategy considerations for pension schemes, and in many cases the investment arrangements adopted, are increasingly complex. Schemes often lack effective structures and processes to manage investment risk and this should be addressed. Our new service aims to help trustees assess the way they develop and monitor their investment strategy and investment management arrangements and to consider the alternative routes open to them.”

Mercer’s recently launched SFO Valuations 2009 report, which analysed 257 schemes with average assets of approximately £150 million, found that investment strategy is reviewed every three years by 40 percent of schemes. However, 46 percent of schemes stated that they did not undertake a periodic review of investment strategy and that reviews tended to be event driven.

“There has been much criticism that the structure of trustee boards means they are ill-equipped to respond quickly and effectively to the demands of the modern market,” added Ms Brougham. ”The assessment service provides trustee boards with the means to review their current investment governance arrangements and identify opportunities for improvement in order to ensure their scheme performs as well as possible for members.”

Using an analysis of a scheme’s current procedures via a questionnaire, workshops and peer comparisons, the investment governance service will analyse the current investment structure and processes, and will support trustees in identifying, agreeing and executing opportunities for improvement.