We have a thorough process to identify ‘best in class’ investment managers.

The short list

We start with a short list of the most promising investment managers using the following criteria:

	Strong past performance measured against clear benchmarks
	Low variability of performance
	A sound investment philosophy and process
	Excellent company management
	A strong and stable investment team
	High-quality research capabilities and resources

Digging deeper

We then obtain more detailed information from short-listed investment managers through in-depth questionnaires and face-to-face meetings.

As part of this process, we consider both the current strengths and the future outlook of managers. We look for a sound investment approach, consistent application of investment decisions, consistent strong returns, a sustainable investment approach, depth of resources and the capacity to adapt to changing conditions.

The right combination

As a final step, we project how each investment manager is likely to perform in different market conditions. This enables us to identify where we may be able to produce better returns, adjusted for risk, by using a combination of investment managers with complementary investment processes rather than a single investment manager.

Working for us

We employ investment management companies directly. This has a number of advantages over investing in existing investment funds.

	We are not restricted to UK funds and can choose leading investment management companies from around the world.
	We can closely monitor investment managers against objectives that we set and influence them in matters such as team selection.
	If the manager of a fund does not meet our expectations or we identify a better manager in a particular market, we can transfer the assets of the fund from their management directly to a replacement. We don’t have to sell up and start again with the accompanying tax and expense implications.