In 2017, the Financial Conduct Authority (FCA) first used its concurrent competition powers by referring the asset management market to the CMA. Although investment consultancy and fiduciary management is a relatively small market (revenue of approx. £558 million in 2016), the market influences pension scheme assets worth more than £1.6 trillion. The impact on consumers of competition enforcement is a key benchmark for the CMA..
The CMA’s provisional decision on the FCA’s reference identifies a number of competition concerns, including:
- a lack of engagement among pension-scheme trustees
- a lack of transparency and information from service providers
- high levels of concentration and vertically integrated business models that create conflicts of interest between investment consultancy and fiduciary management services.