GLOBAL - Standards set by the newly-launched charter for best practice in transition management should be raised, State Street, Barclays Global Investors (BGI) and Russell Investments have demanded.

The so-called T-Charter was presented today as a code of practice for transition managers, signed by 17 companies offering these services including State Street, BGI and Russell (see list below).

It contains standards on disclosure and conflict of interest as well as client confidentiality, remuneration, dealing strategy and cost estimation.

However, State Street, BGI and Russell stated shortly after the official launch of the voluntary code of practice, the requirements set do not go far enough.

"We need to ensure that these standards truly reflect best practice and not just a level or standard that all potential participants can achieve," the managers said in a joint statement.

"We are concerned that in this [charter] the standards for performance are not as strong as they should be and ultimately may not provide a sufficient level of protection or comfort to clients."

The managers noted the current T-Charter was the result of two years of negotiation on a much more rigid framework but "evolved into its current state to get the widest possible industry acceptance".

State Street, BGI and Russell therefore warned clients not to rely solely on the T-Charter when choosing a transition manager.

"We urge clients to continue to ask tough questions to prospective providers, and not automatically assume that the T Charter provides them with the transparency and fiduciary level of service they deserve."

Overall, they "welcomed and applauded any initiative that aims to set best practice standards for the transition management industry".

Initial signators to the T-Charter:
ABN AMRO Transition Management
BNY Global Transition Management
Barclays Global Investors
Credit Suisse
Deutsche Bank
Goldman Sachs
Lehman Brothers
Mellon Transition Management
Merrill Lynch
Morgan Stanley
Northern Trust Global Investments Limited
Russell Investment Management
State Street

Have Your Say: Graham Dixon, head of European Transition Services at Credit Suisse, says:

"It is not our place to comment or speculate on why some firms who have signed on to the T-Charter have now decided to criticise it. We firmly believe the T-Charter provides the transition management industry with a set of common standards which has been created with both transition manager clients and advisers in mind."

Have Your Say: Stacy Scapino, global director of Mercer's Sentinel group, says:

"The T-Charter Code of Best Practice forms a key framework for defining market practice. It now gives us accepted industry standards and definitions for critical transition elements and enables us to deliver higher quality and more consistent advice. We view the T-Charter as a crucial step in moving the industry forward and are pleased to see it come to fruition.

"While we anticipate the T-Charter will continue to evolve and be enhanced over time, we believe transition managers should uphold its principles or provide appropriate disclosures. As a code of best practice, we expect that the T-Charter principles will be adopted globally. "

If you have any comments you would like to add to this or any other story, contact Barbara Ottawa on +44 20 7261 4618 or email