Norway’s consultants are witnessing some growth in their business, particularly on the life insurance and pensions side, says Jimmy Johansen, consultant at Benefit Network Consulting. “Traditionally, it’s been very broker-dominated, particularly on the life side, but now consultants are increasingly used,” he says.
This change can be attributed in part to a backlash against the high levels of broker commission, he says. “There has been a reaction in Norway against the commission that the brokers are taking for their services,” says Johansen. “It is seen to be unbalanced with the service the client gets. The transition to a fee-based service is more appealing for clients.”
Apart from this, clients can see that there is a difference between the advice given to them by consultants and that offered by insurance company agents, he says.
Consultants say the need for independent advice has become even more pressing for pension clients recently. Many have become unnerved by the sharp downturns seen in world stock markets.
Olav Overland, managing director of Nordic consultancy Wassum Investment Consulting, says there has been a substantial increase in the use of consultants. “Before we started working here, there were hardly any consultants – just one or two companies working on a case-to-case basis,” he says.
Besides pension funds, Wassum’s business comes from the municipal sector, from investment funds and energy companies, he says. The firm undertakes some management consultancy work and structuring on the unit-linked side, and creates fund information packages for mutual funds.
Pensions legislation passed last year opened the way for defined contribution pensions for the estimated 1m Norwegians who have no supplementary pension provision. Consultants say this should in turn lead to an increase in business for them.
“It is only now clients are considering setting up defined contribution schemes as opposed to traditional defined benefit plans,” says Overland.
In Norway, the role of consultants has often been overlooked by institutional investors, but there is a growing awareness of their value in the investment process. New firms are emerging as the market expands.
“A lot of Norwegian-based pension funds now look at international investment and alternative investments,” says Overland.
Also, attitudes on pension fund boards are changing. More and more, boards are demanding a more structured way of organising the asset/liability split, and are looking in greater depth at ways of using the capital they have allocated to the pension fund. “Boards have to look at stress testing and investment analysis,” says Overland.
This year has seen a tightening in the legislation within the municipal sector, he says, and this has led to local authorities seeking the services of consultants.
Whether a consultancy is part of an international chain or not, it is vital in Norway to have good local knowledge, says Johansen. Clients need to have information given to them in their language. But having solid international expertise is also necessary for success. “A combination of both is ideal,” he says.

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