The Investment Association (IA) has attempted to draw a line under its Statement of Principles controversy by announcing it will not reintroduce a list of signatories to the 10-point code of practice.
First introduced in April 2015 by the IA’s then-chief executive Daniel Godfrey, the trade body published a list of 25 initial signatories to its principles last August.
The move was hailed by adviser-focused organisations, but a number of fund groups opted not to sign in the belief that the proposals were too “prescriptive” - an episode which catalysed a backlash against Mr Godfrey’s reforming agenda from the asset management industry, culminating in the chief executive’s departure last October.
The IA subsequently said in December 2015 that “a discussion period” with members was required, and that it would remove the list of signatories in the intervening period.
Investment Adviser can reveal the trade body’s board, which includes soon-to-depart interim chief executive Guy Sears, has now decided that the IA will not reintroduce the list of signatories, nor the requirement for those firms to publicise their adherence to the values.
The move is likely to please members but disappoint campaigners who believed the code would aid efforts to improve the public perception of the industry.
The principles will now act as “a useful framework for firms when reviewing their values”, the IA told members today (August 26).
Member concerns centred on the additional compliance burden involved in publicising the principles rather than issues with the principles themselves, the trade body added.
“While many members have informed us that they are comfortable with the values embraced in the Statement of Principles, it is also clear that the prescriptive formulation may not be the precise way in which individual firms want to express their values to existing and prospective clients.
“Even where regulatory obligations across the globe may aim for the same common objectives, they are often expressed in different ways within differing legal and business contexts.
“The Investment Association recognises there are other ways, at least as valid and informative, to describe the core responsibilities of fiduciary asset managers.”
These include the FCA’s own rulebook, which states that an asset manager must act honestly, fairly, professionally and in accordance with clients’ best interests, the IA noted.
