Last week, the Managing Partners Forum ( – in conjunction with Noble investment bank – launched its professional services index signalling the maturity and importance of the publically listed part of the professional services market and addressing its relative non profile amongst investors and analysts. 70 firms are listed in London in this segment and the MPF Professional Services Index is designed to help investors, firms and funds to track the performance of listed professional firms – a fast growing and highly profitable asset class.

The index addresses the fact that there is no official industry classification benchmark (ICB) and so professional services is not tracked as a sector and there are no investment funds specialising in the sector – yet it accounts for 16% – 20% of the UK economy. The premise is, of course, that increasingly professional firms will decide to list on public markets and will therefore need to encourage investors to appreciate their profitability, growth and resilience. A timely move particularly in view of the changes in the legal sector as part of the Legal Services Act that will allow such external investment within just a few years and as the world in general falls out of love with the broader banking and financial services sectors.

There are 35 companies in the sector – as they excluded financial services companies and those with a market capitalisation of below £20m or above £1bn – and the top 15 are shown below. As well as offering a methodology for valuing professional firms, the MPF also offers a definition of a professional firm:

• 80% of an organisation’s core business activities must require a specialised knowledge of a subject, field or science, and satisfy at least four of the following six criteria:

• Involves higher level education and usually a formal qualification.
• Regulated by a professional body, licensing authority or similar.
• Has an ethical code of practice.
• Do not derive significant financial benefit from service or product providers that are recommended.
• Services can be infrequent, technical or unique.
• Selection is usually based on a mix of skill, knowledge, reputation, ethics and creativity.

The first report shows that the new index outperformed FTSE AIM UK 100 but was more volatile than the FTSE 350 Support Services index and the FTSE 350 (excluding investment companies) indices.

1. Aegis Group plc (Media)
2. WS Atkins (Support services)
3. Savills plc (Real estate)
4. RPS Group plc (Support services)
5. BPP Holdings plc (Support services)
6. WSP Group plc (Support services)
7. NCC group plc (Software and services)
8. Begbies Traynor Group plc (Support services – Insolvency and accounting)
9. RWS Holdings (Support services – Intellectual Property)
10. Management Consulting Group plc (Support Services)
11. Clarkson plc (Transportation)
12. DTZ Holdings plc (Real estate)
13. Huntsworth plc (Media)
14. Tenon Group plc (Financial general – accounting)
15. Charles Taylor Consulting plc (Financial General)

Other familiar professional services firms included are: Murgitroyd (Patent and trade mark attorneys), Penna (human resources) and Vantis (accounting).