Kempen; an alternative approach to investing

As trustees we will make sure we understand what you want to achieve and deliver against these objectives in a measurable, sustainable and innovative way leaving you to focus on other important issues. We believe innovative investing shouldn’t have to cost more. We look to access the right asset class in the most efficient way possible making sure that your membership can see value for money and stability of returns.

In Summary working with us helps you to:

Focus on your business
Make agile informed decisions
Make sure your membership gets the best outcomes

why kempen are different

In the face of rapidly changing market conditions in a fast moving financial world and increasing investment complexity, managing pension assets relative to its liabilities is a major challenge for UK pension schemes. With our Fiduciary Management expertise we help Trustees to focus on strategic issues. Our additional expertise helps to enhance funding security, raise funding levels, reduce volatility and take unwanted day-to-day management of multiple third-party relationships off your hands. At the same time, an informed strategic sparring partner can help make the path you have set out towards your long-term goals both smoother and shorter.

Download 2020, 04 November

Introduction to FM

why choose kempen as your fiduciary manager?

Often Trustee boards are looking for a long-term partner that can demonstrate stability of ownership and longevity in the fiduciary management market, as well as a long term and sustainable stance to investing. We believe the way we do this is different to our competitors but discussions usually begin when pensions schemes look to resolve some, or all, of the following:

Reduce the governance requirement on the Trustee board;
Make decision-making and implementation swifter;
Reduce the likelihood of extra deficit repair contributions being required;
Maximise returns but within sensible volatility and risk limits;
Improve the chance of achieving the return target needed to reach the De-Risking Objective; and
Ensuring a transparent and cost effective solution

If you are experiencing any of these issues as trustee board we can offer you a free assessment of your scheme. Click here to speak to one of institutional relations team.

In our eyes there are five great reasons to trust us to be your fiduciary manager:

1.We’ll provide you with an entirely bespoke solution

We build a customised portfolio for and provide a tailored solution to each and every one of our fiduciary management clients. This can involve integrating your goals and beliefs in your investment strategy, such as by prioritising low costs, certain asset classes or socially responsible investing. And it can also be in terms of exactly what you want us to do for you. For example, you might wish to set your strategic asset allocation yourselves or delegate that decision to us, or you might wish to maintain a veto when it comes to choosing which managers to invest with.

2. Managing conflicts of interest

Fiduciary management presents a number of conflicts. We help to minimise and manage these by only providing fiduciary services. We are not a Scheme Actuary or a Covenant Adviser. We believe our version of fiduciary management can help Schemes reach their funding goal meaning we don’t let the provision of ancillary services distract us from that core objective.

3. Open architecture

We use an open architecture model that employs the best external managers for our clients. Our clients delegate their authority through a power of attorney which together with the external managers, provides transparency and removes the conflict of investing in internal funds.

4. Client service

Collaborating with our clients is the cornerstone of what we do, and we have created solutions to meet specific client challenges. We have a client satisfaction score of 83%.

5. ESG

We are the leading fiduciary manager in the UK with regards to ESG. ESG is embedded in our organisation so we can accommodate clients who want to meet the minimum legal requirements or those that have a stronger sense of long term stewardship, and others who simply want to future proof themselves against increasing public opinion and regulatory requirements.

Three frequently asked questions

Fiduciary management, what is it all about?

Fiduciary management is all about outsourcing some or all of the day-to-day tasks that are involved in running a pension fund to an expert third party. Trustees decides upon a scheme’s overall strategy. Based on those strategic decision they will start delegating the investment decisions and day-to-day management of the portfolio to a fiduciary manager. Fiduciary management is not a product. It’s a service, depending on what each client wants. Each of our clients is unique, so they each require a unique fiduciary management solution.

Does fiduciary management mean a loss of control for us?

Delegation does not mean a loss of control for you as a trustees. As EY found many trustees feel they gain control by working with their fiduciary manager to set an effective strategy and agreeing on a framework within which the fiduciary manager needs to operate to achieve a successful outcome. Fiduciary management with Kempen is a partnership which ensures the strategy is right for the scheme, that it is reviewed on an ongoing basis and that everything that is done is transparent and reported back to the Trustees on a regular basis. It also hands back time to Trustees so that you can use that precious time to focus on strategy which adds most value. If anything, this leads to greater control.

Does fiduciary management add extra costs?

In a word, no. Fiduciary management removes the traditional consulting costs, creates efficiencies between providers because the fiduciary manager acts as one point of contact, reduces underlying asset management costs due to the fiduciary manager’s buying power, and most importantly adds value – schemes using FM have outperformed those using traditional consulting models.

Client quotes:

“Our schemes have a highly tailored governance structure, with experienced trustees and a sophisticated sponsor. Kempen has adapted their model of fiduciary management to be bespoke to our needs. The team is responsive and pro-active, and is at the core of our overall investment structure, working most collegiately with both our other advisors and those of the sponsor. It is a long and trusted partnership”

Ian Pittaway
Partner, Sackers

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