The Hindu Business Line : Making awards count!

The morning after, a few of them SMS the news to select clients. Some place advertisements in newspapers. Others display them prominently in product literature. Their marketing executives rarely forget to mention them at presentations.

But do we really need so many different awards? No, not when one good system of paying tribute could have served what may be seen as the obvious raison-d'etre: Separating the men from the boys. That, it may be argued, is about the only thing that investors would care for at the end of the day.

The latest to join the award bandwagon - ICRA, the credit rating agency - has (along with the others) made a point or two in this regard. Awards, it is pointed out, are a way of recognising the performers; the manner in which the awardees are chosen is expected to guide investors and not confound them in any way whatsoever.

The fund houses concerned suggest that the award-giving organisations are all independent; a positive verdict coming from one such organisation really delivers a message important enough for investors to consider.

The point is well taken. However, a couple of things should be considered before you lose your way in the labyrinth of awards. One, the verdicts handed out at glitzy award functions should not be exploited by marketing departments of asset management companies to further their own agenda.

Two, investors should know that the performance put up by an award-winning fund manager is not permanent - in fact, it is of ephemeral nature as no one can deliver superlative returns every time.

There are at least three organisations that have instituted awards in India. One is a media house known for the magazines it publishes. Two of them are credit rating outfits. Crisil, the country's top rating agency, is the leader on this front too, having set off its practice of awarding funds way earlier. ICRA, which has entered the space only recently, seems to be trying hard to promote its own version of the same.

Let us at this juncture take a look at some of the advertisements issued by players recognised at the recent ICRA Online Mutual Fund Awards 2005. These clearly carry subtle messages, worked out as they are by skilled copywriters engaged by ad agencies.

Tata MF's strategically-placed ad declares that "the reward of expertise is in meeting the gold standard', a reference to the golds won by two of its debt funds. SBI MF puts it more plainly, underscoring the three golds and two silvers that its equity and balanced funds have bagged. The strapline in this case, however, is not so plain. In fact, it is in the form of a question - "Still wondering where to invest?" - thrown at readers who are expected to know the answer the next time they formulate their asset allocation strategy.

So, is there a case for awards, advertisements and more? Will you let credit rating outfits and the like influence your decision? Will you formulate your strategy based on their opinions? These are all major questions, but ones that require to be answered.

Feedback may be sent to nilanjan@thehindu.co.in

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