Although all the major consultants have a strong presence in the Italian market, business is still predominately focused on employee benefits and pensions advice for multinationals, reflecting the fledgling status of the country's two year old domestic pension fund industry.
Consultancy work is beginning to filter through from Italy's 'closed-end' industry funds, with advisory work increasingly being sought on investment manager selections, benchmark development and evaluation of historical data. And the country's 'open-end' funds are also engendering op-portunities in HR consulting and selection of suitable funds, although this has been limited until now.
Hugh Twiss, head of the investment department at Milan-based Simcogef, says: The pensions market is taking a long time to develop in Italy, so the consultants are obliged to move at the same pace. Consequently, issues such as performance measurement, investment mandates and scheme design are rarely being broached.
"We have recently seen quite a bit of promotion activity from Sedgwick, and Intersec are running some performance comparison, so things are op-ening up, although I think we are looking at four to five years before any real drama unfolds."
Stefano Grassi, head of product development at Prime Investment Management, comments: "On the domestic side, there are few Italian consultants, with the exception of Milan-based Callan, Timo & Associates and Adelaide Consulting which are of any significant size. So, the consolidation taking place abroad within foreign consultants will certainly shape the future market in Italy."
Marco Boscetti, consultant at Towers Perrin, adds: "Since the Italian government paved the way for solely DC fund existence there has been a proliferation of pension providers in Italy and consequently we are advising on more manager selections, asset profiles and benchmarks. The future consultancy market in Italy though is pegged to two issues - scheme design and fund administration, with the former being doubtful as to whether it will take off, but the latter set to become essential as the funded market develops." Hugh Wheelan"