FCA publishes final asset management market study report

FCA has published the final findings from its asset management market study. It has considered the responses it received following its interim report and is now proposing a package of remedies falling into three broad categories:

  • protection for investors who are not well placed to find better value for money;
  • driving competitive pressure on asset managers; and
  • improving the effectiveness of intermediaries.

Among the specific proposals are:

  • using the SMR to bring individual focus and accountability to fund managers to help strengthen the duty to act in the best interests of investors;
  • requiring at least 2 independent directors on a fund manager’s board;
  • supporting a single, all-in fee disclosure requirement and a consistent and standardised manner of cost and charge disclosure to institutional investors;
  • carrying out a market study into investment platforms; and
  • asking Treasury to bring investment consultants within the regulatory perimeter.

FCA has published a consultation paper on:

  • rule changes to implement its plans in terms of investors’ best interests;
  • clarifications to its guidance on how fund managers should approach moving retail investors in pre-RDR share classes into better value classes;
  • requiring fund managers to pass back to the fund box profits that have been generated without taking any market risk;
  • whether it should introduce an end to trail commission payments; and
  • whether it should apply these remedies to other retail investment products.

The consultation closes on 28 September.