Two leaders in investment consulting have called on institutional investors to think more about how they manage their beta, or market exposure because manager skill is unpredictable and often too expensive.

Speaking at today's European Pensions & Savings Summit in Barcelona, Roger Urwin, global practice director at Watson Wyatt and Charley Ellis, founder of Greenwich Resources, said given how hard it is to pick fund managers that will do well and the associated costs, more attention should be paid to how beta is managed. The argument is particularly strong for smaller pension funds with limited governance.