Scandinavia is seen as a prime target by any new fund manager trying to break into the European institutional market, but it is all too easy to fall into the "one size fits all" trap.

The region is characterised by a number of very large funds, each with professional, high calibre staff, which makes it easier for new managers to break into the market, particularly through the use of search engines such as IPE-Quest.

However, the divergences in their approaches to international investment in particular, makes a common approach to marketing institutional investment products meaningless within the region.

While Denmark and Finland have a very heavy bias towards fixed income assets, this is not the case for Sweden and Norway, which tend to take investment risk through exposure to equities, rather than through more risky fixed interest assets such as high yield and emerging market debt. Moreover, the pace of pension fund reform has been different and the local regulations governing investment of pension fund assets can be very specific to each country.

The divergence of behaviour within the Nordic region came through very strongly at the Seventh Annual
Scandinavian Institutional Investors Summit, held in Copenhagen in June. The opening sessions on the pension fund reform process within each of the major Nordic countries showed the different emphases given in each market to their own current thinking in the areas of pension fund and life insurance investment strategies.

With regulators also examining a whole host of other areas such as corporate governance, it is not surprising that the conference had a very eclectic set of topics ranging from
fundamental indexation to shareholder litigation, hedge funds to emerging markets, global real estate to Danish mortgage-backed bonds, and corporate governance to fixed interest to name just some of the areas addressed.

What is clear though is that investment managers see the Nordic countries as an area where some of the more cutting edge ideas often find ready acceptance.

It is not surprising that the conference also included some representation from investment institutions from outside the Nordic area, with one representative from a Dutch pension fund declaring, "the Dutch are behind the Scandinavians, we thought we could learn from you!"

Some panels covered new approaches to looking at traditional asset classes. These included the move towards "global alpha, domestic beta" in the fixed income markets, hosted by Principal Global Investor's Ulrika Bergman. This addressed whether and how European investors should try and access a global universe of debt opportunities while still being aware of their own liabilities; fundamental indexation which examined the recent development of indices based on weightings derived from assessments of companies' "real worth" rather than market capitalisation; and global REITs as instruments for gaining property exposure.

There were also panels on the alternative investment classes with some managers taking the opportunity to describe their hedge funds and private equity, while a panel on emerging markets included both a discussion of a multi-manager approach to covering the whole globe using regional specialists suggested by Nomura's Mark Roxburgh as well as an eloquent argument for why Africa excluding South Africa was now worthy of serious investment consideration. This thought-provoking presentation was given by Ayo Salami of Syndicatum Capital International and attracted considerable interest.

The conference also included local specialities such as sessions on the Danish mortgage-backed bonds, which deserve a wider international appreciation.

Given the positioning of Scandinavia in European institutional management as trend-setters, it was not surprising that the conference was also characterised by a strong presence from US lawyers specialising in shareholder class action lawsuits attempting to generate activity in the European market.

Unfortunately, what came across as a strong sales pitch masquerading as an educational seminar was combined with the usual Scandinavian reticence to ask questions, particularly in response to a forceful approach to advocating the benefits of picking up a so called "free lunch" at the table. The net result was a stony silence when question time came, much to the chagrin of the US lawyer.

The danger that any conference organiser faces is that the search for yet more sponsors can detract from the attention required to produce a clear, coherent theme, good speakers and the organisation of panels and presentations of educational rather than advertising material that will entice investors to return year after year. This was a conference which may have benefited from a bit more emphasis of the latter.

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