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Morningstar Stewardship Grades for Mutual Funds

I remember that Morningstar used to have Stewardship Grades for Mutual Funds? What happened to these? Did Morningstar discontinue these grades? I cannot find them anywhere.

Thanks for your help, Alban


  • M* thinks of Stewardship and Parent, so just a change in current terminology,
  • Thanks! From these slides, Stewardship appears different from Parent. I can see the Parent ratings in the fund data now, but no Stewardship grades. Has Stewardship been discontinued?
  • Well, the literal answer is that Stewardship ratings are gone. But a different answer is that they are folded wuithin the Parent rankings.

    From medalist methodology, 12/2023,

    ...asset manager and its management set the tone for key elements of Morningstar’s evaluation, including capacity management, risk management, recruitment and retention of talent, and firmwide policies, such as incentive pay, which drive or impede the alignment of the firm's interests with those of fund investors.

    Beyond these operational areas, Morningstar analysts prefer firms that have a culture of stewardship and put investors first to those that are too heavily weighted to salesmanship...."

    In this 44-page document, that is the only reference to stewardship.
  • That makes sense. Thanks! My guess is that Morningstar discontinued stewardship because constructing it was more data and labor intensive. For example, constructing board independence would take a lot of effort.
  • Hi there. Yogi is correct -- we decommissioned the stewardship grades some years ago when we rolled out the 'Analyst Ratings' (now called 'Medalist Ratings'), one pillar of which was 'Parent'. In essence, we relocated the stewardship assessments from the Stewardship Grade framework to the Parent pillar rating framework, but we didn't reduce our focus on these matters.

    I hope this is helpful.

    Let me know if you have any follow-up questions.

    Kind regards,

    Jeff Ptak
    Morningstar Research Services
  • edited February 16
    @jptak, good to know that you have been at MFO for MANY years. As there are many comments/complaints here related to M* or Morningstar, I often wondered if anyone from M* was here looking or monitoring.
    BTW, we have also communicated at X/Twitter (@syouth1, @YBB_Finance).
  • Surprise ! Surprise ! Surprise! Golly .
  • I go back to the Roy Weitz days.;)
  • edited February 17
    Nice. +1

    I read a lot of the M* Analyses and they emphasize stewardship often (perhaps using different terminology). Stability of management across the organization is something they often mention. High turnover is a negative. If managers invest in their own funds that’s a plus. Lots of other factors I’m sure.

    There’s a lot of emphasis on the firm’s long term performance across all its funds vs peers, which is somehow factored into a fund’s overall rating. That might cut both ways. I’m thinking of a firm with a whole lot of ”dogs” - but one or two long standing exemplary funds.

    I particularly enjoyed a recent read of Morningstar’s analysis of Neuberger Berman Long-Short Fund (NLSAX) which I own, although I’d rate it higher than they do (Medalist Rating Bronze ).

    A couple brief excerpts:

    “The firm has come a long way since its origin as a value-equity shop under Roy Neuberger in 1939. Many of its distinct fixed-income and equity portfolio management teams are long-standing mainstays, but the firm has methodically added to its investment capabilities …

    “Firm ownership and alignment with fundholders are foundational to the culture. One fourth of employees (including many senior investment decision-makers) have stakes in the employee-owned firm, creating shared ownership in the firm's success …”


  • edited March 29
    hank said:

    ”I particularly enjoyed a recent read of Morningstar’s analysis of Neuberger Berman Long-Short Fund (NLSAX) which I own, although I’d rate it higher than they do (Medalist Rating Bronze ).”

    Just wanted to note that Morningstar raised its rating of NLSAX from Bronze to Silver approximately 2 weeks after my comment posted. More appropriate ISTM.

    Excerpt from M* Fund Analysis -

    Medalist rating as of Feb 29, 2024 - “Increased confidence in Neuberger Berman Long Short A's prospects relative to its Morningstar Category peers leads to an upgrade in this strategy's Morningstar Medalist Rating to Silver from Bronze.
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