The most fashionable accessory for any large financial services organisation these days is a boutique. Across the industry big names are creating boutique-style structures in a desperate bid to keep their investment talent intact.

And it's hardly surprising. Barely a week has gone by this year where Investor Weekly has not reported one institution or another haemorrhaging senior staff either to competitors or, more likely, to form their own boutique funds management shop.

The most recent example of course is UBS' former head of Australian equities, Paul Fiani. It was reported last week he plans to set up a boutique called Integrity.

Fiani's move highlights one of the biggest problem facing funds today - how to keep hold of their star managers. The phrase is 'key man risk' and it's something the big name financial groups have had to come to terms with.

Colonial First State, UBS, Credit Suisse, Invesco, ING, to name but a few, have all suffered from losing high-profile managers this year. 

It is a particular problem for small cap teams. While I'm not trying to say that skilled large cap managers are two to a penny, it is true to say the market knowledge required to run a successful small caps portfolio must necessarily be greater.

Information is at a premium with small cap stocks and is far harder to come by. Few have heard of Neptune Marine Services, for example, while if you haven't heard of BHP Billiton then you've had you're head buried in the sand for the last 50 years.

Replacing a good small caps manager, with all their intimate knowledge of the world of corporate minnows, is by definition much more difficult than relacing a large caps manager.

One way big institutions have found to keep talent on board is to offer managers a stake in their own businesses.

By letting go of the financial reins but keeping hold of the fund administration side, big firms can free up their star managers to focus on what they're best at - stock selection.

There are also few better incentives than owning a majority stake in a business.

Macquarie Bank and Credit Suisse are two notably large investment managers that have already gone down this route. Christine St Anne spoke to both of them for her cover story on small caps.

The feature this week is a round-up of all the investment mandates that changed hands between March 2005 and March 2007. This information is notoriously hard to come by, but through our database we have managed to tabulate as much relevant information as possible on mandate changes in the superannuation industry.

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