DC Advisers Are Among Many Focused on Client Trust

Retail banks, active investment managers, defined contribution plan advisers, recordkeepers—they’re all focused on building client trust as a crucial element of future sales success.  

According to Cerulli Associates, trust is the foundation that will make the relationship between investors and their providers last for the long term.

This is the conclusion of a number of recent Cerulli publications, including the November 2016 issue of The Cerulli Edge – U.S. Edition. Notably, it’s not just defined contribution (DC) retirement plan advisers coming to a new appreciation of the importance of a high quality client experience—all types of financial services providers are doing this work.  

Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.

“Besides their legal obligations, providers offering additional products and service solutions must truly be in the clients’ best interest in order for the long-term relationship to be successful,” Cerulli researchers argue. “We believe that those firms that seek to align their best interests with those of their clients will substantially increase their marketshare over time.”

According to Cerulli and others, the effort of building real client trust will not just be necessary to be a top-performing firm; it will be a basic element of survival for service providers hoping to operate in the investment atmosphere anticipated for the mid- and long-term future. Investors, especially those under age 40, are more likely to prefer a consolidated relationship than to maintain a variety of relationships, Cerulli explains. There will also be far more scrutiny about conflicts of interest and proving value for service. Thus firms that are successful in gaining client trust will clearly be in an advantageous position.

Scott Smith, director at Cerulli, says these emerging investors “are likely to need an expanding service set, but some elements of their relationship could be loss leaders from the near to medium term.”

“Banks, insurance agents, retirement recordkeepers, certified public accountants, and direct brokerage platforms all vie for the central role in investors’ financial lives,” Smith concludes. “Rather than trying to serve any particular product niche, providers across the industry seek more opportunities to serve as the hub of their clients’ entire financial existence.”

Further complicating the picture, Cerulli’s research predicts investors, even in this new environment, will for the most part either remain unaware of the vast majority of available products or services—or they may not believe that their current providers are truly qualified to serve them in additional areas.  

“Over the past decade, a number of financial services providers have attempted to enter the ‘comprehensive wealth management’ segment that previously addressed only distinct pieces of households’ financial needs,” Smith says. They have met greater and lesser amounts of success, but nonetheless Cerulli feels provider firms “must embrace the opportunity to expand their reach or risk losing their place in investors’ financial lives altogether.”

Information on obtaining Cerulli Associates Research is available here

Retirement Industry People Moves

T. Rowe CIO to Retire; Voya Hires VP of ESG; Morningstar Appoints Two New Leaders in Tech; Great Lakes Advisors Hires Managing Director; and more.
T. Rowe CIO to Retire

Brian C. Rogers, T. Rowe Price chairman and chief investment officer (CIO) will retire from his post on March 31, 2017, according to the firm’s board of directors. Rogers has been with the company for nearly 35 years and he assumed his current role in 2004. Following his retirement, Rogers will remain on the board of directors and serve as the non-executive chair.

Anne Marie Whittemore, lead independent director, observes that Rogers “has been responsible for helping the firm navigate multiple market cycles, including the global financial crisis, and for guiding the board’s commitment to diversity.”

Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.

T. Rowe Price has also appointed six senior investment leaders. Rob Sharps will be Group CIO, with responsibility for coordinating the activities of the team; Henry Ellenbogen will be CIO, U.S. Equity Growth; David Giroux will be CIO, U.S. Equity Multi-Discipline; John Linehan will be CIO, U.S. Equity Value; Justin Thomson will be CIO, International Equity; and Mark Vaselkiv will be CIO, Fixed Income.

The team will share CIO responsibilities, which include providing investment thought leadership, partnering with investment division leaders to develop investment talent and capabilities, and serving as mentors for the firm’s investment professionals.

NEXT: Voya Hires VP of ESG 

Voya Hires VP of ESG

Voya Investment Management has appointed Drew Schechtman as vice president and Environment, Social and Governance (ESG) integration leader. He will be tasked with integrating ESG investment disciplines across the firm’s four investment platforms comprising equities, fixed income, loans and multi-asset.

Working with the Voya Financial Office of Corporate Responsibility, he will serve as a lead advocate for ESG internally and externally—including developing an ESG education platform for investors.

Mark Weber, senior managing director and head of Structured Assets, Loans and Alternatives business, says, "We believe environmental, social and governance factors are important in understanding the risks and opportunities of our investment decisions across asset classes. We embarked on an ESG-integration program last year and are delighted to have Drew help join us to lead that effort."

Schechtman brings more than a decade of experience to this role. Prior to joining Voya, he was vice president and head of Sustainability and Environmental Investing at BNY Mellon. There he was responsible for leading the development and implementation of the firm’s sustainable finance solutions across various business lines. Prior to that, he was a senior sustainability consultant at Viridian Energy + Environmental.

"Our chief investment officers are committed to integrating ESG considerations into their investment processes, and they believe that Drew's experience in ESG integration across multiple investment teams will help us accelerate our progress," says Weber.  

NEXT: Morningstar Appoints Two New Leaders in Tech 

Morningstar Appoints Two New Leaders in Tech

Morningstar has appointed Mitch Shue to the position of chief technology officer and James Rhodes to the role of chief data officer.

As chief technology officer, Shue is responsible for Morningstar's long-term technology vision and execution. He joined Morningstar in 2014 through the company's acquisition of HelloWallet, where he served as chief technology officer. Prior to HelloWallet, Shue was vice president of engineering at Centrifuge Systems. He was responsible for developing interactive data visualization solutions. He previously led the graphic design, engineering, and data center teams at webs.com and served as vice president of product development at webMethods.

Rhodes oversees data operations at Morningstar, focusing on the company's data technology strategy including data collection, processing, and storage. He previously served as chief technology officer and partner at Rocaton Investment Advisors, where he drove the company's technical vision and oversaw the software engineering team. Rhodes also spent 13 years at IBM Research, where he led the financial modeling research efforts of IBM's Global Services business units.

"Mitch's and James' appointments to Morningstar's leadership team help strengthen our commitment to technology, one of our core competencies," says Morningstar President Kunal Kapoor. "Their expertise will prove invaluable as global demand for our independent research and data continues to increase in light of evolving regulations and industry standards. We're committed to continuous technological innovation to best help investors reach their financial goals."

NEXT: Great Lakes Advisors Hires Managing Director

Great Lakes Advisors Hires Managing Director

Joe Wright has joined Great Lakes Advisors as the firm’s managing director and head of consultant relations. He will be responsible for building and developing relationships with the institutional consultant community.

“We’re proud of what we’ve accomplished at Great Lakes, in terms of firm growth and expanding our capabilities,” says CEO Tom Kiley. “Bringing on an experienced leader like Joe will allow us to focus our institutional business around our effective partnerships with consultants.”

Great Lakes Advisors manages fundamental equities and fixed income from its Chicago office, and disciplined equities from its Safety Harbor, Florida, office. Recently, the firm has added expertise in environmental, social and governance investing and socially responsible investing.

NEXT: USI Insurance Purchases Atlanta Insurance Brokerage Firm

USI Insurance Purchases Atlanta Insurance Brokerage Firm

USI Insurance Services (USI) announced it has completed its purchase of Johnson & Bryan. The purchase of the retail property-casualty and employee benefits insurance brokerage firm expands USI’s business into Atlanta, Georgia.

USI says it looks forward to leveraging Johnson & Bryan’s customer-centric culture and reputation for delivering quality risk management services via the USI ONE Advantage platform. 

Robert C. Wynne, president of Johnson & Bryan, predicts that joining forces with USI will improve coordinated insurance solutions and deliver powerful new analytics through USI’s Omni Knowledge Engine. 

USI is a national insurance-brokerage and consulting firm, delivering property and casualty, employee benefits, personal risk and retirement solutions throughout the United States. Headquartered in Valhalla, New York, USI has reports more than $1.0 billion in revenue.

NEXT: Voya Appoints Employment Benefits President

Standard Life Investments Appoints New Director

Standard Life Investments, a global investment manager, has appointed Jim Sia as its director of sub-advisory and defined contribution (DC) business. He will lead the firm’s efforts in these two spaces throughout North America and will report to Eric Roberts, head of U.S. business development.

“We are delighted to welcome Jim to our team and his experience and knowledge will be a valuable resource as we expand and diversify our client base,” says Eric Roberts, head of U.S. business development. “This newly created role is an important component of Standard Life Investments’ commitment to offering clients a diverse range of investment solutions.”

Sia has more than 25 years of experience in investment management most of which has been spent in the DC space. He’s worked for GMO and Wellington Management Company. In addition to his defined contribution role at GMO, he also led the strategy development and relationship management for sub-advisory business. He is a founding member and immediate past chair of the Defined Contribution Institutional Investment Association (DCIIA), a national organization dedicated to improving retirement outcomes in the US.

NEXT: New CEO Joins QMA

New CEO Joins QMA

Andrew Dyson has been appointed as the new chief executive officer of QMA, effective April 2017. Dyson will be tasked with overseeing QMA’s investment organization as well as its distribution and management functions.

In his most recent role, Dyson served as vice president and head of global distribution for Affiliated Managers Group, where he worked in partnership with the company’s affiliated boutique investment managers on their distribution efforts. Previously, he served as head of BlackRock’s global institutional client business and held senior roles at Merrill Lynch Investment Managers and Mercer Investment Consulting.

Dyson will report to David Hunt, PGIM’s president and chief executive officer. He will assume his new role from Scott Hayward, who is leaving the company after more than a decade of service to pursue new endeavors. Hayward will remain at QMA through the rest of 2016 working with senior leadership to help with the transition.

Founded in 1975, QMA manages portfolios for a worldwide institutional client base, including corporate and public pension plans, endowments and foundations, multi-employer pension plans, and sub-advisory accounts for other financial services companies.

«