The closet-tracking scandal, the Icelandic crash and sustainable investing are perhaps the three best descriptors to sum up the background to Scandinavian and Nordic asset management – although the industry says the story has moved on since 2015’s benchmark-hugging revelations.
Regulation exists in Scandinavia to make sure that things are now “fair and above board”, says one local funds chief.
If investors in Stockholm, Oslo and elsewhere disagree, they can take their money to America’s Vanguard, a firm that claims its ETFs are successfully bringing down fees at its rivals.
Relieving some pressure from this fees-and-costs challenge, homegrown firms say business has been boosted since Iceland relaxed the capital controls ushered in during its banking crisis. Icelanders are now freer to invest overseas and fund firms in the region are benefiting.
They may benefit more from the trend towards responsible investing; a strong history in this means it could be the industry’s greatest export. Sustainability has contributed to a ‘squeaky-clean’ reputation for the region. That is, until accusations of money-laundering surfaced among banks.
Nick Fitzpatrick, group editor at Funds Europe
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