Manager selection changes

Sadly, the Lens did not board planes to Monaco or Copenhagen this year for the full investment conference experience. Instead, we sat back in flip flops and dialled into a variety of topics on Zoom.

One webinar showed how fund manager selection processes in the current environment had changed. Manager selection meetings were much quicker, aided by technology, we heard. One asset owner, for example, had developed tools to carry out more desktop research. Another spoke about how whole teams from fund managers had been involved in some calls whereas historically it would have been impossible to do this and calls were only with the fund manager.

One asset owner went so far as to say that due to the pandemic environment they had not appointed any new investment managers and had preferred instead to allocate to existing ones. However, this was not echoed by others, but all of them did agree they missed the human aspect of meetings, partly for not being able to “tap into gut instinct”.

Another snippet that was interesting was that the higher focus on ESG and sustainability had led to one researcher finding a 25% increase in their workload to cater for these extra checks.

Also, with several mergers between investment managers having taken place in the past year, this too caused an extra layer of work as managers involved were placed on observation lists.

But, despite the changes in fund management selection brought in by Covid or other factors, one area still cited as being an important factor in manager selection continued to be the quality and stability of a team.