Understandably, costs – and how they are communicated to investors – continue to dominate discussion on asset managers, and that’s another area where Cummings must take the lead.
Just this week we’ve had PWC’s report on remuneration, and what it sees as a “move away from the star manager culture and towards team-based incentives” which will have a “positive impact on the reputation of the industry and mitigate risks of high-profile departures”.
Ironically, it was the biggest ‘star manager’ of them all, Neil Woodford, who underlined the point with his firm’s decision to absorb research costs in an initiative aimed at being more “open and transparent” on the costs associated with running an active fund.
That’s all very well though, as one wealth manager put it to me recently, it’s distinguishing your TERs from your TCOs and OCFs that’s become a real challenge. If wealth managers are confused, what does this mean for everyday investors?
Plenty for Cummings to ponder then. With the more combative approach of previous chief executive Daniel Godfrey having backfired somewhat, culminating with his departure after threats of mutiny from major fund groups, interim chief Guy Sears deserves much credit.
Having quietly helmed the IA’s successful restructure, and seen through the introduction of the long-mooted Productivity Action Plan, Sears has laid the foundation for Cummings to take on the mantle and really make his mark.
A figure of some repute from his time at AIFA, and having built up considerable political leverage at TheCityUK, Cummings now has a platform to push for real positive change.
