A quiet crisis in a loud market

Image: Image: Filograph / Getty Images / Canva AI edit

Pardon the Interruption

This article is just an example of the content available to mallowstreet members.

On average over 150 pieces of new content are published from across the industry per month on mallowstreet. Members get access to the latest developments, industry views and a range of in-depth research.

All the content on mallowstreet is accredited for CPD by the PMI and is available to trustees for free.

Amid a wave of pension scheme consolidation, shifting liabilities, and shrinking budgets, asset managers face a far more subtle challenge: staying relevant. As clients become fewer, larger, and more selective, many managers are still relying on the same tools and tactics – often casting the net wide, rather than focusing on the specific audiences that matter, and doing so without the innovation UK asset owners need.

The not-so-quiet consolidation


By 2035, the UK pension investment landscape could look radically different:

The LGPS ‘fit for the future’ consultation led the government to ask schemes to accelerate pooling. It has since told the Brunel Pension Partnership and ACCESS to find new homes for their members – reducing the number of LGPS investment decision-makers from eight to six.

Image: mallowstreet
In the DC space, master trusts are already dominant. There are 36 authorised schemes today – but only three currently meet the government’s suggested £25bn threshold, and even the rest of the top ten are still relatively small. Consolidation continues not just among micro schemes, so we could end up with just 10 mega-trusts.

Image: mallowstreet
Many DB schemes are now closed, but around £1.3 trillion of liabilities still need to be insured. With buy-outs running at £65bn a year, full coverage could take two decades. In the meantime, smaller schemes are pushing their portfolios harder to close funding gaps, while some larger ones are choosing to run on and build up surpluses. Either way, DB investors are becoming fewer, larger and more discerning too.

The quiet crisis


The bigger schemes get, the more they will look at their asset managers as strategic partners than providers – which naturally limits the number of relationships they can maintain. Over the past few years, many managers have tried to diversify away from DB and into DC, LGPS or insurance clients, only to find they lack the right offering, brand recognition, or the right leads from the events they attend.

At the same time, asset managers face a quieter crisis. Marketing budgets, already squeezed since 2022, have reportedly halved year-on-year in some firms – now down to a quarter of previous levels.

But rather than sparking innovation, this pressure has fuelled a wave of consolidation. BNP Paribas acquired AXA IM, Impax bought Bullfinch, and Ninety One absorbed Sanlam AM – to name a few examples from this year alone. In Q1 2025, fewer infrastructure funds raised more capital – a sign that capital is concentrating in fewer hands. Yet, among three major mergers, only Amundi has consistently attracted inflows; Janus Henderson and abrdn have struggled to do the same.

Not delivering, so not earning?


All this suggests that UK institutional investors are increasingly confronted with a product offering that not only does not fit their strategic needs, but also underdelivers on performance.

Schroders red-flagged ten of its funds for underperformance, Aberdeen Investments flagged twelve equity strategies, and Janus Henderson raised concerns on 23 out of 59 funds. Columbia Threadneedle found over a third of its fund range falling short on value.

JP Morgan also flagged multiple underperforming strategies – and, like many managers, responded by cutting fees. Median total investment fees in fiduciary management have now dropped 15 basis points over five years, representing around 27% of lost revenue, but this is hardly the only example.

In the first half of 2025 alone, eleven investment trusts were liquidated. Most fiduciary managers have posted average – if not muted – returns. And listed vehicles like NextEnergy’s solar fund are trading at deep discount, down 27% despite efforts to improve performance.

Not changing


Despite all this, the output hasn’t changed: we still see the same formulaic fund updates, predictable outlooks, and identikit macro commentary that hasn’t evolved in years. Meanwhile, the industry is caught in a cycle of content fatigue – both producing and consuming it.

Marketing emails land multiple times a week, often poorly targeted. Companies push followers to “engage,” but it’s unclear what that even means in an institutional investor context. Impressions are counted as a proxy for visibility, clicks as a proxy for interest – but  neither tells you who’s likely to become a client.

Yet money continues to be spent. Boosting a standard LinkedIn post can cost $500 a week, potentially returning 53,000 impressions, 2,000 engagements, and 240 clicks – and maybe 16 leads, but not all of them relevant. Video posts might push impressions higher, but often deliver even fewer leads, and it’s unclear how LinkedIn qualifies conversions. You can’t meaningfully target UK institutional investors on social media – nor on most commercial insight platforms.

There has to be a better way


In a market where buyers are getting fewer, bigger, and more selective, doing the same things louder isn’t a strategy – it’s a risk. Success can no longer be measured in impressions and clicks, so it is time to start asking tougher questions: who exactly are asset managers reaching, and why should they care? Relevance now depends not just on having something to say, but saying it to the right people – with purpose, clarity, and a genuine understanding of what they actually need. It’s time to do less, better.

Are you seeing this shift – and what are you doing differently?

More from mallowstreet