Fiduciary management and investment governance

Institutional investing is an increasingly important, complex and resource intensive topic. At EY, we help pension schemes identify effective governance models and get the most out of their appointed investment advisors or fiduciary managers.

Related topics Consulting Financial Services Insurance

What EY can do for you

We have been providing independent investment governance and fiduciary management advice to pension scheme trustees and sponsors since 2010. We work with each of our clients to truly understand their investment needs and constraints, then identify and help implement a practical governance model aligned to their unique requirements. 

Our framework for providing advice and the areas we look to explore are below:

  • Governance: How do you design roles and responsibilities for your committees and advisors?
  • Provider tendering: With so many providers, how do you find the one that is right for you?
  • Investment monitoring: How well is your provider doing?
  • Strategic objectives: How do your strategic objectives incentivize the right outcomes?
EY providing independent investment governance advice

Fiduciary management

Fiduciary management is an investment governance solution that involves investment decision-makers, such as pension schemes trustees, delegating certain elements of their investment process to a third-party fiduciary manager.

The delegation of certain investment decisions has become increasingly popular with pension schemes and other asset owners. Commonly, it is motivated by the desire to free up time to focus on key strategic issues, improve implementation speed and efficiency, access a greater variety of asset classes and risk management techniques economically, and ensure there is a dedicated investment resource looking at the investment strategy on a daily basis.

There is a spectrum of delegation available from fiduciary managers, and investment decision-makers can implement the approach that best suits their needs and objectives.


Typical levels of delegation used by UK pension schemes:

Levels of delegation used by UK pension schemes

Our services include:

  • Investment governance

    Effective investment governance is critical to asset owners’ success, including pension schemes, in meeting both their investment and overall objectives. We advise clients on bringing change to their processes to make the most effective use of their resource.

    Our approach focuses on benchmarking existing governance arrangements against leading global practice, identifying areas for improvement and supporting the implementation of the new governance model.

    Also see:

    ESG investing under fiduciary management (pdf)

    Fiduciary management for large schemes (pdf)

    Environmental, Social and Governance (ESG) investing under fiduciary management (pdf)

    Investment governance in the US (pdf)

  • Ongoing monitoring and oversight

    The appointment of a fiduciary manager changes the trustee’s or investment decision-maker’s role in non-strategic investment areas from one of decision-maker to one of oversight and challenge.

    Independent monitoring and oversight ensures robust ongoing governance is implemented. It is important for trustees to be able to test and benchmark their fiduciary manager’s performance and operations relative to the UK fiduciary management industry – an industry that is evolving rapidly.

    EY have an experienced and dedicated team in providing independent assessment of performance, decision-making and operations of fiduciary managers. Each assessment is client-specific and structured around the trustee’s requirements and the fiduciary manager’s mandate.

    As a provider that does not compete with fiduciary managers and investment consultants, we bring real objectivity to the assessments of the service that clients receive.

  • Selection and re-tender exercises

    It is essential to select the right long-term investment adviser or fiduciary manager, who is able to meet objectives and provide exceptional client experience. Independently run competitive tenders are the most effective way of enabling trustees to understand the various models available and appoint the provider most closely aligned to their needs and objectives.

    Such a process enables clients to set off on the right path in terms of both investment solution and operating model. Wrong decisions can be made if it is passively assumed that all solutions and supporting infrastructures are similar.

    There has been significant EY investment in technology to build a selection dashboard that allows trustees to capture their key requirements and objectively identify the providers most suited to their requirements. The technology allows us to combine the requirements of high speed, low cost and high quality and offer a very efficient selection process.

    Also see: 

    Fiduciary Management – CDI – The Latest Differentiator (pdf) 

    Does past performance accurately reflect the past? (pdf)

  • Value for money assessments

    EY has been a leader in reviewing fees since 2013, when we published our first Fiduciary Management Fees Survey. In total, 15 fiduciary managers participated in our most recent survey, covering the majority of UK fiduciary management assets.

    We help clients understand the details of the proposed fee structure and the different layers of fees charged under a fiduciary management arrangement, and the incentives created by those fee structures.

    Fees and expenses are a vital aspect of our value for money assessments. We spend a significant amount of time researching fiduciary managers’ fee arrangements, and we understand what a competitive fee arrangement looks like.

    Also see:

    2023 Fiduciary Management Fees Survey (pdf)
    2021 Fiduciary Management Fees Survey (pdf)
    2020 Fiduciary Management Ongoing Transaction Costs Survey (pdf)
    2019 Fiduciary Management Fees Survey (pdf)
    2017 Fiduciary Management Fees Survey (pdf)

    Ernst & Young LLP. has conducted a detailed survey of the UK DC Master Trust market, covering providers’ strategic priorities, customer experience, charges and investments. The survey covers 22 authorised Master Trusts (around 90% of the Master Trust market by assets). The survey contains valuable insights, both for Master Trust providers evolving their market proposition, and for employers considering transferring their existing DC plans into a Master Trust.

    Click here to download the EY Master Trust Survey (pdf).

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