Industry veteran Nikolaus Schmidt-Narischkin is to join Towers Watson Germany in July to help the consultancy strengthen its “holistic approach” in an environment where consultancies have to “cover the whole range of added value” for companies, according to Reiner Schwinger, managing director at Towers Watson Germany.
Schwinger told IPE Schmidt-Narischkin fit the consultancy’s strategy “perfectly”, pointing out that the current head of client solutions for the EMEA region at Deutsche Asset & Wealth Management (DeAWM) had worked in a number of fields, including HR, asset management and benefits.
He said Schmidt-Narischkin would be working on a “broader” basis than he had done in recent years, and that placing him solely in the investment consulting department at Towers Watson would “not have presented anything new or challenging” for the occupational pensions veteran.
He will therefore be working in a more “holistic role”, Schwinger said.
Schmidt-Narischkin said: “Providers now have to offer everything, including asset management, platforms like a CTA or a Pensionsfonds, and risk management, both on the active as well as the passive side. The question is whether an asset manager can still provide this, or whether it will rather be the consultancies that offer these broad services.”
Having been in charge of fiduciary management at Deutsche Bank, where he has worked in a number of departments over the last 25 years, Schmidt-Narischkin said, even in Germany, clients were looking increasingly to outsource to external providers, yet without the “blackbox principle” that had been applied in the Netherlands in recent years.
“German clients prefer a modular approach,” he said. “They do not want any conflict of interest, and they want a provider who takes on responsibility and can be held accountable.”
He said this was easy to promise in a quiet and stable market environment and that the real test for fiduciary managers would come in the next crisis.
For him, the “core problem” in German occupational pensions is that too few people are participating in the system, although he said the overall legal framework was “not bad”, with small adjustments needed here or there.
Citing Pensionsfonds as an example, set up in Germany 10 years ago, Schmidt-Narischkin pointed out that a lot of the occupational pension legislation was “still unfinished” and argued that it would need a “task force” to close all the gaps in the framework.
Schwinger added that German occupational pension laws had to be adapted to the ageing society and changing role models to generate more attractive pension products for clients, citing the example of a single mother who does not want to pay into her pension fund because her children cannot inherit the accrued assets.
Other problems arise from high discount rates and inaccurate mortality tables, he said.