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SIMON BROWN: I’m chatting with Janina Slawski, executive head of investment consulting at Alexforbes. Janina, I appreciate the early morning time. Your ‘The Manager Watch Survey’ is out. We’ve chatted a couple of times around this, but remind us what The Manager Watch survey is, its purpose and how it is formulated every year.
JANINA SLAWSKI: Thank you very much. Good morning to everyone. Yes, it is an annual survey, and essentially it’s a barometer of what’s happening in the asset-management industry with a focus on retirement funds. It is fascinating. As we all know, investment markets are incredibly challenging at this time. Lots of good returns last year and lots of good returns since the war started. So essentially it says who is doing well, what the trends are, how much is going offshore, and what’s happening in terms of the BEE status of asset managers. So it all comes together in a very interesting annual survey.
Read: Strong 2025 masks weak long-term retirement returns
SIMON BROWN: It is data rich. My little brain absolutely loves it. You talk around some of the trends. We’ve mentioned this before – multi-managers continue to gain share. What does it say? In 2019 for every R1 to single managers multi-managers got 15 cents. That’s now 30 cents. This is a big shift and it’s happening slowly. But it is significant.
JANINA SLAWSKI: It is part of a much bigger trend. Obviously there’s a lot of complexity in running standalone retirement funds, so a lot of funds are moving into umbrella funds and making the decision that, if you’re going to make that decision, you might as well simplify overall. So a lot of standalone funds are actually moving into multi-manager portfolios within umbrella funds.
SIMON BROWN: Yes, keeping it simple. Global allocation – you mentioned this. As of December last year 40 of the 53 managers had more than 30% in global assets, eight exceeding 40%; the average was 33.5%.
It would seem that we’ve sort of hit that sweet spot with the 45% limit within Regulation 28. We’re saying, well, managers can now pretty much take what they want, and what they’re looking for is actually a little bit lower than the 45%.
JANINA SLAWSKI: Well, obviously rand strength also helps to take it down. So 2025 was an amazing year in terms of local equity returns, rand strength, which you know is huge, a huge good story for local asset managers, local investors. But obviously any assets you held in dollars lost their value over the year.
This doesn’t necessarily reflect that managers were actually consciously reducing. The rand strength reduced it and, as we know, we have not had rand strength since the beginning of the war.
So that figure is going to vary a lot, both because asset managers have views on offshore and what happens with the rand because of offshore asset returns.
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SIMON BROWN: You mentioned transformation. What we are seeing is frankly significant transformation – 54 of 78 managers in terms of the ORM [Online Reputation Management] survey are level-one contributors. This is significant. This is an industry that is largely transformed.
JANINA SLAWSKI: Obviously a lot of it was driven by client demand, but also by the regulator and National Treasury, et cetera, asking hard questions.
So yes, we have walked a journey with the asset managers in the industry and the commitment to transformation is amazing.
They’ve really pulled out all the stops in terms of ownership and transformation of investment professionals, procurements and spending, et cetera. And obviously one of the biggest trends has been that of the large managers – such as Coronation, Sanlam, Old Mutual.
So when you look at our survey and see the huge increase in the number of BEE or majority black-owned strategies, a lot of that is just driven by the fact that the asset managers have made that cross along the lines, and therefore their strategies are now BEE.
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SIMON BROWN: You talk around size. Who are our biggest asset managers in the country?
JANINA SLAWSKI: Well, we have a gorilla called Ninety One. They for a few years have been at the top, and obviously with the transaction with Sanlam that’s going to change significantly over the next 12 months. So do not expect a change at number one.
But then obviously other big names are STANLIB, Coronation, Sanlam, et cetera, and [there are] some changes between the managers. And significant transactions like the transfer of assets from Sanlam to Ninety One are going to make a big difference when you see the survey that comes out this year.
SIMON BROWN: In terms of performance, you mentioned last year was a really, really strong year on the JSE. Of course, you had to be very, very all-in on gold, otherwise perhaps you weren’t getting the return – and it would have been a brave call back in January to have made that.
But how were returns for the industry in ’25 in light of what was a good year for equities?
JANINA SLAWSKI: I think we’ve said for some time that the fact you can take money offshore to a much higher level is causing massive dispersion, because managers will either get it right or they won’t get it right …
Yes, I said South African equities has had a fantastic year, but if you look at the dispersion of the one-year returns for South African equity, it ranged from 8.7% up to 50.6%. So obviously, even if you’re in the 40s or 50s, user clients are delighted. But imagine if you had only an 8% return, and then similarly on the global best investment view a dispersion of 6% to 33%.
So these are markets where the quality of stock-picking and the tactical allocation by managers is just going to be dramatic in terms of differentiation between the highest and lowest.
I think clients are going to have to look at their managers with much more critical eyes. They can’t all just be following passively and if the market goes up they all go up.
They will definitely go up more if they have that quality in terms of stock selection and asset allocation.
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SIMON BROWN: Yes, it’s a good point in time to earn your stripes.
A last question around fees. Certainly if we take a big step back and look out over a decade or two, fees have absolutely been coming down. There’s a chart in here which talks around fees, maximums, minimums, averages, I have to say, for an industry.
I’ve mentioned this before – with my first unit trust in the ’90s I was paying 5%. The maximum fee is now sub-1%. This is before performance and the like. But fees really have moved in the direction of good news for investors.
JANINA SLAWSKI: Definitely. Obviously what we’ve got in the graphs are institutional fees, so you will still find some high fees for retail, especially with low asset amounts. But the trend has been dramatic.
This is the advantage of competition, and clients have been asking questions. Consultants have been asking questions.
Generally there’s been a drive towards more disclosure and the clients having to certify that their fees have been checked and are reasonable. That is a huge benefit to investors, because those fees are coming down and that compounds dramatically over longer periods to give better returns to members of funds.
SIMON BROWN: Yes, absolutely. It’s that compounding over time, and the trend has certainly been in the favour of the clients.
We’ll leave it there. Janina Slawski, executive investment consulting at Alexforbes, has been talking around their December 2025 Manager Watch survey. Janina, I appreciate the early morning.
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