Index providers: The importance of being earnest

Who makes the investment decision? This is a question investment managers are regularly asked by advisers and investors. With more investors embracing passive investing over active management, now more than ever, this question has become important.  For active investment, the fund manager makes investment decisions based on the fund's documented investment strategy. For passive investments, this strategy often entails tracking an identifiable index, one generally created by a third-party provider.  As a result, the decisions of each index provider ultimately have a substantial i...