Benchmarking consequences – with Mithesh Varsani, head of investment solutions at Scottish Widows

Mithesh Varsani, head of investment solutions at Scottish Widows, is our guest for the first episode of series seven of The Professional Investment Podcast. He chose MandateWire’s ‘Are Australia’s pension funds stuck in a performance testing loop?’ as his news story of the week. This article raises interesting questions for UK policy makers as they put together the value for money framework. This will operate a traffic-light system based on how a scheme performs. There are questions as to whether such a performance metric should be a permanent feature or retired after an initial period to allow weak performers to be weeded out. This would give greater flexibility to the remaining schemes. We talked about how different parts of The Pension Scheme Act will influence industry behaviour. Will the scale requirements push scheme to embrace more low-cost investments to win market share? And will this work against value for money which aims to improve net returns? Another key policy initiative is to encourage pension schemes to invest more in UK productive finance. But if VFM encourages investment herding, this might act against allocating to private assets. Like other DC providers, Scottish Widows is grappling with the need to provide members with a retirement income. The final part of our discussion focused on what private assets could be incorporated at this part of the member journey to allow them to remain invested in growth. Chapters: 00:00 Welcome to Series 7 with Mithesh Varsani 00:51 News of the Week, Australia's Performance Testing Loop 04:53 UK Policy Lessons, Value for Money and Pension Reform 09:04 The Traffic Light Risk, Avoiding a Vanilla Market 13:06 Balancing Scale with Genuine Member Value 16:18 From Policy to Portfolio, Investment Strategy in Practice 20:48 Private Markets, Building the To and Through Glide Path 28:17 New Frontiers, Liquid Alternatives and Diversification *Mithesh joined Scottish Widows in January 2025, as Head of Investment Solutions, focused on understanding evolving customer needs across our Workplace, Advised and D2C channels engaging with market participants, translating these into outcomes to develop innovative investment solutions. He joined from Mobius Life, where, as Chief Investment Officer, he spent 15 years playing an instrumental role in building an innovative, market-leading business, focused on bespoke investment solutions for a broad range of investors.*    *Mithesh brings a breadth of expertise across strategic research, asset allocation, and portfolio management, combined with deep experience in designing and implementing sophisticated investment strategies. He is a CFA Charterholder and graduated with a First Class Honours in Mathematics with Economics. He has a strong track record of understanding client needs and partnering with asset managers and stakeholders to address complex investment challenges, delivering solutions that drive better outcomes and create long-term value. A proven innovator in both the DB and DC marketplace, Mithesh has led the development of industry-firsts spanning from structured derivative solutions, private markets to sustainable assets.* #PensionsPodcast #ValueForMoney #PrivateMarkets #DCPensions #ScottishWidows