Performance fee critic's fees found wanting

Harbour announced changes to the fee structure for its Australasian Equity Fund at the start of the year, while also writing a scathing critique of other fund managers and the way their performance fees are calculated.

Of the 12 funds assessed by Harbour, only its own fund passed on all five criteria: quantum; benchmark; performance hurdle and cap; high water mark and crystallisation period (the criteria were based on a report by Morningstar Australia). 

But Harbour has admitted its fund fees wouldn't have ticked all the boxes before the changes were implemented.

Darren Howlin, a research manager for Australian fund management ratings house Lonsec, said Harbour's performance fee overhaul came after concerns were raised by his organisation.