Governance
Boardroom scrutiny
The Financial Times (FT) looks at the logic of separating the functions of chair and chief executive here.
Also, some useful insights from KPMG on boardroom dysfunctions including lack of independence from management; missing key voices; cultural amplification; diffusion of responsibility; rule-bound cultures; and groupthink. Read the insights here.
Regulation
Research rules reversal
The Financial Conduct Authority (FCA) has proposed a reversal of the Mifid rules on investment research, allowing asset managers to ‘bundle’ payments for third-party research and broker fees. The FT provides an overview, and the Consultation Paper is open for comment until 5 June 2024.
Fund flee
Cash managers are shutting or converting US money market funds ahead of new Securities and Exchange Commission (SEC) rules that institutional prime funds must impose a fee on departures whenever net redemptions top five per cent of total net assets in a single day. The FT reports on the extent of this movement.
Sustainable Investment / ESG
SDR in the spotlight
The FCA is consulting on extending the Sustainability Disclosure Requirements (SDR) to portfolio managers. The Consultation Paper is here and the response deadline is 14 June 2024.
Ahead of the anti-greenwashing rule coming into force on 31 May, the FCA has also provided industry guidance to help firms with meeting the standard.
Emissions omissions
The latest EY Sustainable Finance Index, reported on in Ignites Europe, shows an increase in asset and wealth managers adopting a firm-wide policy to reduce greenhouse gas emissions….but, only 40 per cent of those that have policies are reporting targets.
Classifications commerciality
Adrian Whelan, global head of market intelligence for investor services at Brown Brothers Harriman voices why the Sustainable Finance Disclosure Regime (SFDR) classifications have lost commercial importance in an Ignites Europe webcast.
Market News
LFS failings
The FCA has found that Link Fund Solutions (LFS) failed to act with due skill, care and diligence in its management of the Woodford Equity Income Fund (WEIF). Read the FCA press announcement and the Ignites Europe article.
FBC‘s recent digital member meeting on Fund Board Oversight of Liquidity Risk Management included some lessons learned from the Woodford case. FBC Corporate Members can watch the recording of this session in the Member Portal here and will also receive the latest insights on liquidity risk management in a new FBC research report coming out in the forthcoming weeks.
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