Paul Smith

Paul Smith, CFA

'My good opinion once lost is lost forever'


This line, one of the most famous in the Jane Austen canon, could be easily ascribed to the British public and its view of the UK’s financial services institutions. While the investment management profession has not been immune from censure, particularly around transparency and fees, there is growing recognition that investment managers serve a different purpose to banks, and, crucially, trust between investment manager and retail investor is rising.

In the three years since we last conducted our global investor survey, the faith felt by the retail investor base in the people it entrusts with its money has increased from 51% to 61% globally, with a more modest rise from 39% to 44% in the UK. The industry, however, cannot be complacent. It is notable that while retail investors are more trusting than they were, institutional investors’ trust in the profession has remained broadly static (dipping slightly from 61% to 60%).

The biggest disparities between what an investor expects and what they receive relate to fees and performance. The things which are important to clients can be replicated time after time: trustworthiness, communication, and transparency. If asset managers get the basics right, they will likely be rewarded with loyal clients. Performance needs to be defensible but is not the defining factor. Four out of five retail investors call for more clarity around fees and institutional investors ascribe the greatest importance to fee transparency and ethical behaviour from of a 25-strong list of factors.

Read more in our report.

Paul Smith, CEO
CFA Institute


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