The Investment Association (IA), formerly the Investment Management Association, has published a Statement of Principles for investment managers (the Statement).
The Statement sets out what the responsibility of managing clients’ money means in practice for corporate culture and individual mind-set. The Statement goes further than the regulatory requirement of “treating customers fairly” and expresses the core principle that investment managers must “always put clients’ interests first and ahead of our own” in the execution of their duties.
The remaining nine principles are that investment managers:
- take care of clients’ money as diligently as they would their own;
- only develop, offer and maintain funds and services designed to add value for clients and help them achieve their financial goals;
- maintain and apply the investment and operational expertise needed to meet the objectives agreed with clients;
- make all costs and charges transparent and understandable;
- disclose to investors the source and value of any other material benefit they receive as a consequence of their role as investment manager;
- ensure regular, timely and clear lines of communication with clients;
- set out clearly their approach to the stewardship of client assets and interests;
- maintain a corporate culture that sustains these principles; and
- work with industry colleagues and stakeholders to develop and maintain guidance on industry best practice.
Signatories to the Statement will describe publicly their approach to maintaining the the above principles and how they identify and deal with key issues that could compromise their ability to maintain alignment.
The IA will maintain a list of signatories on its website from 31 July 2015, a link to members’ descriptions of their approach from 1 January 2016 and a link to annual reports on the principles from 1 January 2017. Additionally the IA will review the principles, considering uptake, impact and feedback from all stakeholders in January 2017.