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CMA May Be Sacrificing Quality For Price, Consultants Warn

Law360, London (November 15, 2018, 5:29 PM GMT) -- Investment consultants and their auditors challenged proposals made by the Competition and Markets Authority on Thursday, warning that a requirement for institutional investors to hold competitive bids when appointing asset managers may lead to pensions trustees sacrificing quality for cheaper advice.

Auditor Ernst & Young said that while formal tender processes may lower fees for trustees when choosing an asset manager, this could also lead to them being provided with poorer quality fiduciary advice. And Aon Hewitt Ltd. and Mercer Inc., firms offering investment consultancy services, said trustees can often get better deals by sticking with their current manager.

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