View more on these topics

AITC proposes code to shake up split caps

The Association of Investment Trust Companies is publishing a draft code of corporate governance for the boards of investment trusts in the wake of the split-cap crisis.

The code, which is likely to become a requirement of AITC membership, proposes a series of measures which the trade body says will provide a best practice framework for trusts to follow in the future.

In an bid to counter allegations of divided loyalties, the code proposes that chairmen as well as the majority of the board should be independent of the trust&#39s manager and have no input as an adviser to the investment company.

It also proposes banning chairmen from serving on any other boards of trusts employing the same fund manager.

In the same vein, the code suggests that directors, who should be forced to disclose their employment, experience and other directorships, should be elected for a fixed term of no more than three years, with re-election based on open procedures.

It also proposes bringing in boards early in the trust&#39s development – a commonly cited excuse for splits directors failing to act is that their input was post-design – and full disclosure over matters in which the manager has discretion.

In particular, this would apply to levels of gearing and the performance of the trust. The draft code will be debated at the AITC&#39s directors&#39 conference on February 4.

Director-general Daniel Godfrey says: “The code deals with the special factors faced by investment companies, which are beyond the scope of the combined code and the Higgs review.”

Plan Invest joint managing director Mike Owen says: “You could mention horses and bolting but these are sensible measures. Trusts will have to become more transparent and accountable and that can only be a good thing.”

Recommended

Falcon wins a PI waiver from FSA for a year

The FSA has granted Bristol-based IFA the Falcon Group a year&#39s waiver from its requirements to obtain professional indemnity insurance in a move that could pave the way for other IFAs. More than 20 IFA firms are applying for waivers through Proact Legal solicitor Gareth Fatchett, who believes this case will set a precedent. The […]

Zan brings in account managers to aid IFAs

Zurich Advice Network is setting aside £4m and recruiting an array of industry heavyweights to provide support and shore up its tied salesforce of 3,500. It has recruited six people for the new role of account manager, who will help advisers in the field. These include Lawrence Hawthorn, who joins from Scottish Life and was […]

First buy as Berkeley Berry Birch seeks small IFA firms

IFA group Berkeley Berry Birch has bought former DBS member firm Professional Financial Solutions for £1,528,875 in cash and shares. It says the acquisition is the first in a series of small IFA purchases as part of its latest expansion strategy. PFS has a turnover of £1.5m and has offices in Huddersfield and Camberley. The […]

Halifax finds house prices have leapt 306 per cent since 1983

New research from Halifax bank tracking the last 20 years of UK housing show property prices have increased by 306 per cent. The average price has leapt to £121,742 from £29,993 since the Halifax house price index started in 1983. It says the north/south divide has widened significantly. Prices in London are now 76 per […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com