Pension plan sponsors, particularly of larger plans, nearly always rely on the recommendations of outside consultants in choosing plan investments. They spend a considerable amount of money doing so, with CalPERS and CalSTRS alone accounting for $42 million in investment consultant fees last year. And they're not alone; a 2011 survey found that 94 percent of pension funds call upon outsiders to suggest investments.

A study by Oxford, however, says that it's wasted effort and wasted money — that the recommendations of investment consultants underperform, resulting in lower yields on plan investments.

Howard Jones, Tim Jenkinson and Jose Vicente Martinez of Oxford's Saïd Business School – in a paper titled "Picking winners? Investment consultants' recommendations of fund managers" – concluded that "consultants' recommendations of funds are driven largely by soft factors, rather than the funds' past performance, and that their recommendations have a very significant effect on fund flows, but we find no evidence that these recommendations add value to plan sponsors."