Hewitt reveals details of its delegated consulting future
GLOBAL - Hewitt is to offer pooled liability matching fund and a diversified growth fund as part of its move to what it terms delegated consulting, the firm has confirmed.
John Belgrove, senior associate in the firm's investment consulting division, told IPE: ""We are looking at this both as a segregated approach with customisation and are at the early stages of developing a pooled solution for this as well. This is designed to be a more efficient mechanism for the delivery of best ideas.
"We are considering this approach but have not yet launched the specific vehicles," Belgrove added, though he declined to comment on the exact timing of the launch, fund domicle or shareclass offering. He did, however, say Hewitt saw potential demand in continental Europe.
Clients will also be able to opt for customised implementation of advice through an implemented consulting service, termed ‘delegated consulting' by Hewitt.
Hewitt's decision follows Mercer's announcement in 2004 it would launch dedicated pooled multi-manager funds.
Hewitt says it has seen strongest growth in the last few years in what it terms ‘directive consulting', and which involves the firm having a greater role in decision-making for clients.
It also offers implemented or ‘delegated' consulting where the consultant makes manager selection decisions on behalf of the pension fund so the new pooled funds solution complements these two approaches, according to Belgrove.
Hewitt's medium-term asset allocation group, headed by Colin Robertson, has also now grown to eight staff and is designed, said Belgrove, to fill gaps where investment managers have been weak.
However, it also pitches Hewitt directly against the new multi asset approaches investment managers are now offering through diversified growth funds.
"We are certainly supportive of quite a lot of the particular products in that space. But if you think back holistically to the investment solution for a client, you really need to understand the liability profile to ensure you have the right risk management and there are preferences as to the kind of exposure that trustees want," said Belgrove.
"We tend to find that this kind of approach needs some degree of customisation to fit comfortably with the client, which is why we also offer a segregated approach."
To find out more about Hewitt and other consultants, see Europe's Pensions Consultants, published with the March issue of IPE.