Investment Association issues second response to Asset Management Market Study Interim Report

Friday 18 November 2016

The Investment Association has issued a second response to the FCA’s Interim Report to its Asset Management Market Study.

Chris Cummings, Chief Executive Officer, the Investment Association, said:

“Providing value for money for the UK’s saving and investing public is our industry’s driving concern as today three-quarters of households use the services of our members. We welcome the spirit behind the FCA Market Study to improve confidence in the industry.

“The FCA’s analysis and recommendations come at a time when the industry is already taking significant steps to improve investor confidence. Amongst new measures the IA has put forward is a detailed plan for a new model of charge and cost disclosure, which is acknowledged in the Interim Report and has been welcomed by all parties. We will now look in detail at the FCA’s proposals in other areas, such as independent oversight of investment funds in order to ensure that the FCA’s final recommendations mean customers will be ultimately better served.”

On proposals to introduce an independence element on fund oversight committees:

“We look forward to working closely with the FCA as it consults on its proposed models for enhancing oversight and whether they will be able to meet the crucial test of improving customer outcomes. UK savers and investors benefit from a significant body of regulation that embeds consumer protection in fund governance mechanisms, with independent oversight and safeguarding of assets.”

On proposals to introduce an all-in fee for funds:

“The IA and the FCA have long been united in their support for use of the Ongoing Charges Figure, rather than Annual Management Charge, to provide a complete and comparable expression of investment fund charges to customers. This is available in the Key Investor Information Document, but will be removed in the PRIIP Key Information Document, a development that is wholly retrograde for good communication to customers. Today’s proposal to introduce a single charge across the industry renews the debate and we will work closely with the FCA as it examines how its options might improve the information set delivered to customers.”

On proposals to introduce extra transparency:

“We are very pleased that the regulator has acknowledged the work the industry has completed to improve transparency in areas like costs and charges in recent years, as we work towards our common goal of making sure customers get the clearest and most comprehensive disclosure possible. Our work to introduce a new Disclosure Code will serve our industry’s customers with clear, standardised and consistent disclosure of investment costs and charges, and look forward to the FCA’s increased backing and involvement in that project. Overall we welcome measures to improve customers’ outcomes and we will consider the range of transparency measures proposed and how effective they might be at delivering on that goal.”

-ENDS-

For further information please contact:

John Kenchington
Director of Communications
[email protected]
M 07834 089 332

Linsey White
Head of Media Relations
[email protected]
T 020 7269 4635
M 07508 724 022

Alex Hogan
Press and Digital Media Officer
[email protected]
T 020 7269 4620
M 07508 724 066

About the Investment Association:

• The Investment Association is the trade body that represents UK investment managers who manage over £5.7 trillion on behalf of clients.
• Our purpose is to ensure investment managers are in the best possible position to:
  • Build people’s resilience to financial adversity
  • Help people achieve their financial aspirations
  • Enable people to maintain a decent standard of living as they grow older
  • Contribute to economic growth through the efficient allocation of capital
• The money our members manage is in a wide variety of investment vehicles including authorised investment funds, pension funds and stocks and shares ISAs.
• The UK is the second largest investment management centre in the world, after the US and manages 37% of all assets managed in Europe.