Significant changes in the South African retirement fund environment are anticipated over the next few years. The Financial Sector Conduct Authority (FSCA) has expressed the desire to reduce approximately 5 000 pension funds, currently in South Africa, to less than 500.
The increased fiduciary responsibilities and accountability placed on pension funds by the FSCA over recent years has disproportionally increased the time commitment, cost and risk on small employers offering retirement benefits to their staff.
RisCura, a global investment firm, with roots in the large pension fund advisory sector for over 20 years, recently launched two collective investment scheme (CIS) portfolios. The offerings are specifically for small-to-medium sized companies or funds with limited governance bandwidth, giving these entities access to the same innovative investment ideas that were previously only available to their large stand-alone pension fund clients.
RisCura has been instrumental in using their investment expertise to shape the South African pension fund industry as we know it today. Widely credited as the pioneer of liability-driven investment, alpha transport strategies and one of the first adopters of actively managed China-specific investments, RisCura has been a longstanding and trusted advisor to some of the largest pension funds in Africa.
Currently, the company influences the investments of almost 15-million South Africans through its pension fund and medical scheme clients.
RisCura has been instrumental in using their investment expertise to shape the South African pension fund industry as we know it today.
The CIS portfolios, the RisCura High-Equity Prescient Fund of Funds and RisCura Low-Equity Prescient Fund of Funds, employ a combination of best-of-breed specialist boutique managers that ensure greater responsiveness and the ability to trade in volatile market conditions. A combination of active and passive underlying funds, where appropriate, allows for cost management while not restricting the ability to generate market-beating returns.
While a good employee benefit scheme helps companies to attract the best skills to their organisation, the significant resources needed to run the funds often distracts from the company’s core business activities. A move to an umbrella fund might very well be advantageous to both employers and their employees, with the time-consuming oversight and fiduciary burdens passed on to the umbrella fund trustees.
The move now also allows funds access to the same pension fund investment expertise (previously only presented to stand-alone funds) via the RisCura CIS portfolios that are currently available on the Robson Savage Acumen Umbrella Fund, the Sanlam Umbrella Fund and the Fedgroup platforms. This provides members with the peace of mind that their retirement savings are invested with care.