Mercer's global assets under management grows to $321.4 billion

08 December 2020 Consulting.us
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Mercer, a New York-based HR consulting and wealth management firm, maintained its leading position in outsourced asset management – announcing assets under management (AUM) of $321.4 billion as of September 30, 2020.

That marks a 5.6% increase from Mercer’s AUM of $304.5 billion as of November 30, 2019 – before the black swan event of the pandemic. However, the Covid-19 pandemic has had the effect of funneling more institutional investors to the consulting firm. 

“We are seeing a direct correlation between the challenges of the pandemic and investors’ interest in our investment solutions,” said said Rich Nuzum, president of investments & retirement at Mercer. “The pandemic brought on a liquidity crisis and extreme market volatility. Although equity markets have since recovered to reach new highs, long-term real and nominal interest rates remain near all-time historical lows, challenging investors’ ability to meet their long-term goals.”

Nuzum notes that institutional investors whose governance allowed them to rebalance, de-risk, and re-risk trades, as well as seize upon high-yield and private debt at the market nadir, registered better performance.

“Many asset owners are recognizing their governance didn’t succeed across all these fronts, and are looking to access outsourced chief investment officer (OCIO) investment solutions for assistance before they are tested in this way again,” he added.

Mercer’s global assets under management grows to $321.4 billion

Pensions & Investments magazine in March 2020 ranked Mercer first worldwide for outsourced AUM, and first for assets under advisement as of June 30, 2020. CIO magazine rated Mercer first for global AUM in March 2020 as well.

According to Samantha Davidson, leader of OCIO services in the US at Mercer, the increasing need for portfolio diversification has driven more institutional investors – such as pension schemes, insurance companies, and not-for-profit entities – to the firm’s investment solutions.

“Portfolios today require higher levels of diversification, requiring more asset classes, more investment managers, and overall, more operational management to contend with,” Davidson said. “This increased complexity, coupled with challenging market conditions and fee pressures, also means investors are looking for a more dynamic approach to managing portfolios. All of these requirements are driving interest in investment solutions across our client base and the broader market.”

Mercer recently expanded its investment solutions line with Analytics for Climate Transition (ACT), an offering that helps institutional investors target emissions reductions via responsible investment.

The company’s overall investment business has 1,300+ global employees. The wider firm has more than 25,000 people in 44 countries providing consulting services in health and benefits, workforce and careers, and mergers and acquisitions.

Mercer is part of the Marsh & McLennan group of companies, which also includes Marsh (insurance), Guy Carpenter (reinsurance), and Oliver Wyman (management consulting).