investments Mercer Sentinel®

Mercer Sentinel® is a specialist team focused on advising investors and investment managers on risks associated with investment operations and their execution. The team is focused on operational and service provider risk and comprises industry professionals with the knowledge and experience necessary to guide clients through investment operations, execution, custody and risk management decisions.

Mercer Sentinel is a recognized industry leader with respect to consulting on middle office, investment operations, custody and transaction-based activities, including execution quality, operational risk management and governance.

We offer a combination of extensive practical and operational experience through our team of 50+ professionals, who are located in North America, Europe and Asia Pacific. This team is supported by a deep resource base consisting of proprietary databases, analytical tools and Mercer’s best practice framework.

Mercer Sentinel Services

Our experience shows that firms of all shapes and sizes continue to face basic business risks and increasing regulatory demands.  Investors and investment managers need to be cognizant of operational risks in order to effectively manage them and meet their regulatory duties.

Operational risk consulting: Investment manager operational due diligence and investment manager operational infrastructure optimization.

Custody consulting: Custodian selection, fee and capabilities benchmarking and asset safety reviews.

Transaction/execution cost and efficiency consulting: Investment manager transitions support and transition manager selection.

We help our clients reduce risk and costs as well as potentially improve returns through better control and management of the activities associated with holding, trading, and servicing investment portfolios.

Operational Risk Consulting

Investment managers focused on delivering performance to investors face a number of challenges in supporting alpha delivery through an operational model that provides appropriate oversight over its firms’ processes and procedures. When we review investment managers on behalf of our clients, our risk assessment involves an in-depth review of processes, controls and procedures across core areas of the organization. In conducting this analysis, our primary focus is to distinguish well-managed operations and control environments from those that potentially expose clients to increased, and often unnecessary, operational risks and costs.

Our approach benchmarks each investment manager against safe and sound practices. We expressly consider increased risks and challenges associated with the investment strategy, firm size, complexity and significant third-party or outsourced relationships, along with the mitigating or compensating controls that a firm may have to manage potential risk issues.

We also provide operational consulting to investment managers and asset allocators seeking to optimize internal operational infrastructure support and controls.

We can help investment managers and institutional investors in the below areas 

• Review the existing risk management framework – risk appetite, tolerance, objectives, risk identification methodologies, risk measurement and risk mitigation protocols
• Draft the Risk Register with a focus on identifying and prioritizing key risk factors
• Determine data, report generation and risk management information systems
• Implement an enterprise-wide risk management program that supports the investment decision process and provides on-going management of risk
• Conduct training sessions for the Team on risk management

Mercer Advantage

Dedicated specialists focused solely on governance, service provider, investment operations and execution risk

• We are not generalists. Investment operations and execution risks are our sole focus.
• We assess the structure and controls surrounding investment operations and transactions, asset administration and key service provider relationships.

Expert team with highly specialized backgrounds

• Our approach is to provide our clients with access to individuals with extensive professional experience in custody, operations, transitions, risk management and investment administration. 

Extensive knowledge of industry best practices

• Our team has vast experience globally. We conduct hundreds of projects annually, and have covered over $2 trillion in invested assets over the past 15 years. This provides us with a keen insight into industry best practices.

Global reach

• As a global team (50+), we use our local knowledge to benefit clients who invest internationally.