Consultancy is a boom business in the Swedish investment market, clearly evidenced by the amount of investment outsourcing occurring – particularly from the country’s municipalities and local authorities.
Lars Källholm, president of Stockholm-based Trevise Unibank Investment Management, says over 60% of the largest volumes of money coming into the Swedish market now involve a consultant in the investment process and manager selection.
"The standard of consultants has certainly improved in the last couple of years, the market has matured and the consultants have followed suit. All the players in Sweden are gaining turf."
And it is the domestic firms that are making the running to a large extent.
Stockholm-based Wassum dominates the public sector manager searches and advisory work with fellow Swedish groups Lindstrom & Partners and MPIR figuring strongly.
Of the foreign consultants William M Mercer in Stockholm has gained a good foothold in the market.
All of the major consultants/ accountancy firms have affiliates active on the employee benefits side in Sweden and issues such as GIPS performance standards compliance look set to maintain healthy margins here.
Kallholm adds: "I also see a trend at the moment for investment consultants to do more work on the actuarial side through ALM studies. They are also working with the sponsor on regulatory issues."
As a result Kallholm says he will be surprised if more established consultant names don’t set themselves up directly in Sweden. "The market is big enough and more competition would make sense."
Ola Bjorkmo, managing director at Swedish asset manager Ohman, comments: "A lot of the medium sized UK consultants are certainly looking more closely at the Swedish market. "It is more likely that local players will be transferred into larger, internationally renowned players."
Sverker Lindström of Stockholm based Lindstrom & Partners, founded in 1998, says the firm is focusing primarily on strategic asset allocation issues and manager searches. However, Lindström believes there is some way to go though for Swedish institutions. "I wouldn’t say the pensions market is mature yet, the clients are at the beginning if the process and they need more than ever to search for their own investment goals and structure themselves accordingly."
As a result he believes the foreign consultants are biding their time to enter Sweden. "Once the market is a little more mature they will come in and buy local firms. We need to consolidate the market because most of the firms at the moment are not more than five to 10 people." Hugh Wheelan