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Case Studies in Focus: Replacing an Incumbent Manager Through a Rigorous, End-to-End Selection Process

This post is the fourth in our Case Studies in Focus series, which explores how PMCL works with charities to refine investment arrangements in ways that are evidence-led, practical, and aligned with mission and governance capacity.  


In this case, we supported a UK charitable foundation in replacing a long-standing investment manager whose offering had fallen behind on cost, transparency, and stewardship. Our role: to manage the full search and transition process from start to finish-delivering a lower-cost, higher-integrity solution with minimal burden on the trustee board. 

From Concern to Clear Decision Framework

Following a strategic review, trustees identified several weaknesses in the incumbent’s mandate:


  • Fees and net-of-cost returns had slipped behind peers

  • Stewardship reporting no longer met the charity’s ESG aspirations

  • There was limited transparency on how the mandate was actually run


The board resolved to appoint a new manager and asked PMCL to oversee the process, ensuring it was comprehensive, defensible, and efficient. We began with a facilitated workshop that translated strategic aims into a four-pillar scoring matrix: investment suitability, ESG credentials, service & reporting, and value for money-each with an agreed weighting. This framework became the foundation for every stage of decision-making.


Designing and Running the Selection Process


We cast the net wide. Using a combination of desktop research, third-party tools such as Morningstar Direct and Sustainalytics, and PMCL’s internal charity database, we screened more than forty managers. Nine were long-listed for further engagement based on their strength in core asset classes, cost, and stewardship depth. Each of these nine received a bespoke Request for Proposal (RFP), with questions tailored to elicit detail on portfolio construction, risk management, ESG integration, and full look-through fees. A structured response template ensured results could be compared on a like-for-like basis.


Once responses were in, PMCL conducted quantitative and qualitative analysis using an interactive scorecard. Our team prepared a summary pack for trustees with a clear recommendation to shortlist four finalists. Reasons for excluding the others were documented in full to support future audit.


The final four were invited to interview under a structured agenda. Questions-drafted by PMCL-focused on key governance issues, including behaviour in stressed markets, escalation routes for unresolved ESG engagement, and detail on the proposed service model. Trustees used the scoring matrix to evaluate responses. A PMCL-facilitated debrief session helped the panel weigh softer factors such as cultural fit and relationship potential alongside technical merit.


Final Decision and Transition


Drawing on all inputs-proposals, interviews, and clarifications, we delivered a concise recommendation to trustees, including a full audit trail of decisions. Constructive feedback was provided to all participating managers.


With a preferred candidate selected, PMCL negotiated headline fees around ten basis points below the incumbent, delivering a permanent cost saving. We acted as a translator between the charity’s ESG, risk and benchmark preferences and the manager’s implementation toolkit ensuring the new mandate reflected all necessary specifications.


Transition was carefully managed. In-specie asset transfers were prioritised to reduce transaction costs and market risk. Trade dates were aligned, and any unavoidable cash periods staggered. PMCL co-ordinated all instructions between managers, delivering the client a single, sign-ready transition pack.


Finally, we installed a refreshed Investment Policy Statement and a one-page quarterly dashboard-covering performance, risk, and stewardship-to support long-term oversight with minimal administrative drag.


Tangible Outcomes


The result was a more cost-effective solution with improved governance tools:


  • Sustainable cost saving: A ten-basis-point reduction in fees, directly benefiting future beneficiaries

  • Enhanced stewardship: The new manager ranks in the top quartile for engagement and provides security-level voting data each quarter

  • Defensible process: Every step was documented - meeting the Charity Commission’s expectations for prudent and transparent decision-making


How We Can Help 

This case shows how PMCL helps charities replace underperforming or outdated mandates through a structured and efficient approach - reducing cost, raising standards, and delivering confidence without overloading volunteer boards. If your organisation is considering a manager review or tender process, we’d be happy to help.  

Stay tuned for the next post in our Case Studies in Focus series, where we’ll explore how we built an enduring and holistic partnership with a charity that has lasted for over 7 years.  

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Portfolio Manager Consultancy Ltd. is a company incorporated in England with company number 10777184 and a registered office at 100 Liverpool Street, London, EC2M 2AT.

 

Portfolio Manager Consultancy Ltd (FRN: 795030) is an appointed representative of Thornbridge Investment Management LLP (FRN: 713859) which is authorised and regulated by the Financial Conduct Authority.

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