Ireland has become the first European Union country to adopt Cost Transparency Initiative (CTI) launched by data provider ClearGlass.
The firm, which was founded by cost transparency campaigner Chris Sier, told IPE last summer that it planned an European rollout expanding into France Iceland, Sweden and Ireland.
According to ClearGlass, the CTI is an industry standard that enables pension funds and other asset owners to collect and evaluate fund manager performance and cost data – encouraging fund managers to price their services at the optimal level and ultimately drive better value for money for investors.
Speaking on the opening day of the Irish Association of Pension Funds (IAPF) Spring Conference Week last Tuesday, Sier introduced the CTI to the Irish market, with asset managers, pension schemes and their advisers across Ireland now encouraged to adopt the framework to ensure the CTI becomes an industry standard.
IAPF chief executive officer Jerry Moriarty confirmed the association’s backing for the initiative during the conference.
“The availability of comprehensive and transparent information on costs and charges is essential to ensure the pensions industry continues to provide the Irish people with security in retirement,” Moriarty said.
“We have taken the initiative to promote the CTI disclosure templates across our membership. Once in place, we will call upon asset managers to engage and provide the necessary data to their clients, ensuring Irish investors and savers can benefit from greater cost transparency and value for money,” he added.
The CTI provides investors with the tools necessary to produce standardised costs and charges, according to ClearGlass. This information will allow Irish pension funds and trustees to make clear cost comparisons across different investment platforms, enabling them to deliver better value for money for their clients, it added.
While the disclosure regime is not a regulatory requirement, Moriarty believes there will be strong engagement among investors, asset managers and intermediaries.
There are currently 74,866 defined contribution and 597 defined benefit active funds in the Irish pension fund sector with total assets worth €128.7bn, according to the Central Bank of Ireland.
Sier said that the CTI has already been widely adopted by investment management firms across the UK, Europe’s largest investment fund market – 80% of UK pension schemes now use the templates, representing an estimated AUM of £1.9trn.
He added that Ireland is now firmly ahead of the European curve on cost transparency within the fund management industry.
“This is an important development for Irish pension schemes, and we believe the active support of both the Irish Association of Pension Funds and Pensions Regulator for the availability and provision of this data is aligned with the best interests of Irish savers and will ensure the long-term success of this initiative.”