Money Marketing spoke to Chris Sier, chair of the FCA Institutional Disclosure Working Group, to see how he plans to put a fund cost template in place
Sier: Everyone thinks that the FCA asset management market study interim report was stronger than the final report but actually the main report was the one where the messages were hidden.
I remember Gina Miller making a naive comment which said “consult” was used so many times instead of giving a direct action, but the message is whenever the FCA is planning to make a change to its rulebook, which is the important thing, it is by law required to consult.
In the interim report it talked about the areas where it thinks there is a problem and in the final report it pinpointed the areas it was going to consult on. There were 27 uses of the word “consult” which means there must be potentially 27 places in the rulebook to change and that is a lot.
The thing the FCA asked me to do, to set up a standardised template to disclose costs and charges for asset managers, appears to be one of the most controversial.
The FCA left it out from the interim report and only brought it into the main report.
The interesting part for me is that it has caused absolute uproar. Everybody wants to be involved and who isn’t involved is complaining about not being involved.
When they do get involved or even if they are not involved they are trying to stop this from happening. It’s complicated, it’s messy but quite interesting. It appears to be one of the most important things the FCA has done for some time.
Asset management firms that have nothing to fear have been very supportive and it is interesting to see how many asset managers are breaking ranks, coming to me asking to be involved. The ones that are not coming to me and are complaining the loudest are the ones that have the most to worry about. The market has realised this is happening regardless, the template is going to happen.
There is going to be much more disclosure, it is going to be driven as much by clients as it is by regulation and the asset managers who have nothing to hide genuinely mean they want to help when they ask.