Based on responses from 725 U.S. institutional investors, the Jan. 3 report introduced the "Greenwich Agility Index" as a measure of that needed flexibility, with manager scores based on a mix of 11 "full cycle" and "short-term" criteria.
Full cycle, or longer-term, criteria include "usefulness of formal investment reviews" and "clarity and consistency of the investment process," while short-term criteria include "usefulness of interactions outside formal reviews" and "timely follow-up on requests."
Criteria with both short- and longer-term aspects include: managing portfolio risk, advice on investment policy and strategy, willingness to customize products and intellectual capital transfer.
Todd Glickson, Coalition Greenwich's head of investment management-North America and author of the report, said in today's fast-evolving market environment, asset managers have to be more mindful than ever of the "balance of full-cycle things" and day-to-day services — in areas such as risk management, customization, strategy advice or intellectual property transfer — that differentiates managers in the eyes of clients.
"You set a long-term strategic road map but you need to be mindful, with more frequency now, to calibrate it with what's going on in the short-term," Glickson said.
Coalition Greenwich, the former Greenwich Associates franchise acquired in early 2020 by CRISIL, S&P Global's majority owned securities rating affiliate based in Mumbai, declined to provide scores for specific money managers but its report showed those capable of responding "quickly and efficiently to changes in client needs, market developments and customer expectations" having a powerful competitive advantage in garnering new mandates and achieving sought-after strategic partner status with clients.
The report showed institutional investors more than twice as likely to name managers with top-quartile Greenwich Agility index scores as strategic advisors, vis-a-vis managers with bottom quartile scores — with a seeming appreciation for managers that scored well on the subset of shorter-term Greenwich Agility index criteria.
For example, institutional clients were 2.8 times more likely to name managers that ranked top quartile on short-term criteria as strategic partners than bottom quartile managers, higher than the 2.3 times figure for managers ranked top quartile on full-cycle criteria.
The same pattern held when it came to managers that institutional clients would consider for new mandates.
The report showed U.S. institutional clients are more than five times more likely to consider managers with top quartile scores on short-term GAI criteria, modestly higher than the 4.5 times figure for managers ranked top quartile for full-cycle criteria.