Fortnightly News Blog – 26th April 2022

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Regulation

FCA on Diversity

The industry regulator, Financial Conduct Authority (FCA), published its final rules on diversity for boards of listed companies, Ps22/3 here with a press announcement here. Its scope proposes to exclude open-end investment companies (OEICs), but it does cover closed-end investment trusts. Lots of media coverage, with a report from Investment Week here.

Gender Gains

Mind the (pay) gap

Asset Managers with gender equality funds have smaller pay gaps. Mean pay gaps at firms like Baillie Gifford and LGIM (both FBC corporate members, as it just so happens!) are well below the industry average of 30.1%, Portfolio Adviser reports here.

Wealthy women

Wealth manager Brooks Macdonald has launched a network to support affluent women, suggesting that investment can be a “divisive term” and there are many women who don’t see themselves as investors. Money Marketing reports here.

ESG

Ballooning assets …

Assets in climate-focused funds soar to US$408 billion (£325 billion) in 2021, with Europe remaining the largest and most diverse market for these funds, according to Morningstar research, reported in Investment Week here.

… but, there seems to be a problem. Actually, several

A Harvard Business School report suggested that ESG funds have performed poorly in financial terms, but it goes further, pointing out that ESG funds don’t seem to deliver ESG performance either. Ouch.

Defacto product labelling

And could the reason for the HBR analysis be because funds are simply being “rebadged”? Alain Deckers, the new man at the head of the European Commission’s asset management unit certainly thinks so, and is not best pleased, as Ignites Europe reports here.

SFDR fix

15 asset managers have gotten together under the aegis of a Luxembourg comms firm with the fine name of More Carrot to create an investor friendly version of the new EU sustainable disclosure templates. Smile if you wish, but this is serious business, as Ignites Europe reports here.

And the last word on ESG this week…

FBC Adviser, Brandon Horwitz, provided his insights on ESG and the responsibilities of Authorised Fund Managers, in the new Sustainable Investment, here. Well worth a read!

Distribution Governance

Distributor oversight

Wealth management platform FNZ and Clearstream have agreed a strategic partnership that will help asset managers get a better view of information required for the distribution of investment information. Investment Officer reports here.

FBC Event: Exploring distribution oversight and best practice

For those of you with an interest in distribution oversight, take a look at our forthcoming FBC members digital meeting taking place on 18 May 2022.

We will also be publishing a white paper on the subject. For more information click here.

FBC members can register directly here.

Management Companies

ManCo mania

Frankfurt-based Universal Investment Group a ‘super’ management company (Manco) in Luxembourg has reached agreement on its acquisition of European Fund Administration. Investment Officer has the story here.

How super is your Manco?

Are internal ManCos in Luxembourg and Ireland headed for the knacker’s yard? This article in Funds Europe, with some very useful industry statistics, makes quite a strong case for why even some of the bigger and better resourced firms may think about going external. But the reality is far more nuanced as Franklin Templeton’s Craig Blair commented in the Q1 issue of FBC Insight here.

Longer Read

Lunch with James Anderson

Make time for this excellent long read with Baillie Gifford’s James Anderson. Lunch was taken in Bologna, but the chat covered US technology, Chinese entrepreneurs, and the comforts of 19th century literature. In the Financial Times here.

Several of the news outlet cited in this blog require registration or subscription. Also, FBC takes no responsibility for the accuracy or quality of the news in the links provided above, and nor are the views and comments representative of FBC or its members, unless expressly stated. Content stored on the FBC portal is freely accessible for FBC members.

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