PIMFA Weekly News Bulletin - 17 January 2022

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PIMFA WEEKLY NEWS BULLETIN | 17 January 2022 Dear Nigel,

Welcome to the PIMFA Bulletin; grab a coffee and take 10 minutes to read the latest news impacting you and your firm.

PIMFA Under 40 Forum

PIMFA have again brought together some of the brightest upcoming talent from within our industry to participate in our Under 40 Forum, investigating ideas for broadening the appeal of our industry, fostering a culture of savings and investment, and tackling financial exclusion.

The Forum are conducting primary research to support their analysis, and your help in gathering as much data as possible would be invaluable - to do this please share this survey link across your organisation.

Thank you.

Consumer Duty

PIMFA will be conducting a member meeting with colleagues from the FCA on Friday 21 January to discuss their proposals for the Consumer Duty and the broader impact on advice and wealth firms.

Spaces are limited so, should you be interested in attending and participating, please contact Simon Harrington.

PIMFA & Accenture Survey

PIMFA, in collaboration with Accenture, are currently conducting a short survey on what Wealth Management firms are doing to meet current challenges and opportunities and how they intend to future proof and secure their franchises.

This survey forms an integral part of our research to provide a view of the key impacts on the industry post pandemic and reflect on how firms are evolving.

We expect the Survey to take you no longer than 20 -30 minutes to complete.

To complete the survey, please click here.

Latest PIMFA Press Releases

PIMFA welcomes extension of 10% depreciation notification rule flexibility but calls for longer term reform

Latest PIMFA Press Coverage

CityAM: Exclusive: SIPP godfather John Moret on half a century in the City’s competitive pensions industry

Coalition of consumer groups, charities &

FT Adviser: 2022 will see more

industry bodies welcomes

digitalisation as tech sector grows

recommendation by committee of MPs to include paid-for digital ads in Online

Money Marketing: The second

Safety Bill & calls on Government to act

consultation on the Consumer Duty is still woolly

PIMFA calls for FCA to make better use of data in supervising Appointed

Sunday Times / Raconteur: New returns:

Representatives

banks move back into wealth management

PIMFA calls for greater ambition to solve FSCS levy funding issues

Credit Connect: New Online Safety Bill proposals welcomed

PIMFA raises concerns about FCA’s ‘woolly’ Consumer Duty proposals

PIMFA's Latest Consultation Responses

PIMFA’s latest Consultation Response is to the FCA DP 21/4 on Sustainability Disclosure Requirements (SDR) and investment labels

Read this and all other PIMFA consultation papers here.

PIMFA Events & Learning

PIMFA Live Online Training: Understanding CASS - How to Spot CASS Risks to your Business

25 January 2022 CASS is an ongoing area of interest for the FCA and we continue to see reminders that firms must regularly review CASS controls to ensure they’re robust and fit for purpose.

Specialist trainers from Bovill will look at the CASS rules in detail whilst also following a firm case study through the key areas of CASS to look at how the rules might impact a firm and the risks that firms should look out for. We aim to make the session as interactive as possible and encourage firms to talk about their experiences and ask questions.

To find out more and register, please click here.

View Upcoming PIMFA Events & Learning here

FCA publishes webpage on the MIFIDPRU Remuneration Code

On the 13th January, the FCA published a new web-page on the MIFIDPRU Remuneration Code (SYSC 19G). The Code applies to performance periods starting on or after the 1st January 2022 and sets out the minimum regulatory requirements that a MIFIDPRU investment firm must comply with. The page provides links to the guidance on the application of ex-post risk adjustment to variable remuneration, the remuneration policy statement templates and the Table of material risk takers.

You can read the web-page here.

ESMA’s letter to the European Commission on reverse solicitation

On 17 December 2021 the new Chair of ESMA, Verena Ross, wrote to the DirectorateGeneral for Financial Stability, Financial Markets and Capital Markets Union at the European Commission, responding to the request for support in relation to the report on reverse solicitation and addressed a number of questions relating to the use of reverse solicitation by asset managers and the impact on passporting activities.

ESMA conducted a survey among NCAs which has shown that almost all NCAs have no readily available information on the use of reverse solicitation either via asset managers or investor associations. A couple of NCAs provided some information on the extent to which reverse solicitation is used in their jurisdiction that allowed ESMA to share some anecdotal evidence of the use of reverse solicitation within the EU.

ESMA suggests ideas for filling any information gaps in working out how prevalent reverse enquiry is and says that the European Commission may consider contacting directly market participants such as asset managers, depositories or account holders, possibly via national and European trade associations, which may have such information and, if not, could consult their members.

ESMA also suggests that a consideration should be given to the introduction of new reporting requirements allowing them to collect information on reverse solicitation across the EU.

CBI/PwC Financial Services Survey

According to the latest CBI/PwC Financial Services Survey, financial services firms reported that business volumes in the three months to December grew at the quickest pace since June 2017.

The survey, conducted between 22 November and 10 December 2021 of 105 financial services firms, found that firms’ profitability grew at the fastest rate since December 2015.

Headcount across the FS sector was unchanged for the second quarter in a row. However, the number of employees is expected to grow in the quarter ahead.

Firms expect to increase investment on cyber security in the next 12 months. Responding to new threats (68%), improving ability to detect a cyber breach (53%), and reporting & mitigating cyber security risks (47%) were the most common priorities for improving cyber resilience.

The most common workforce priority for the year ahead is retaining talent (56%), followed by maintaining/achieving high levels of employee engagement (44%) and planning for future talent requirements (36%).

With respect to climate change, 43% of firms said aligning their corporate position and ESG strategy to their underlying loan, insurance, and investment portfolios was their top priority for the next three months. A standardised governance / reporting framework and ability to track progress was the most common factor needed to deliver ESG agendas (32%). The most common net zero target date for FS firms is 2030 (42%). 40% of FS firms believe they are somewhat prepared for mandatory TCFD disclosures in the UK, with 26% saying they’re fairly prepared and 14% reporting that they’re very prepared. By comparison, only 14% said they were not at all prepared.

The most common priority for D&I over the next 6-12 months was supporting health and wellbeing (70%). Many firms also cited improving ethnic (54%) and gender equality (49%) as priorities. On balance, FS firms believe that public perceptions of the sector have improved as a result of the pandemic, with 67% believing it had improved compared to just 17% reporting it had deteriorated.

UK and India launch negotiations for a Free Trade Agreement

The UK and the Republic of India have formally launched negotiations for a Free Trade Agreement between the two countries. The India-UK bilateral trading relationship is already significant, and both sides have agreed to double that bilateral trade by 2030, as part of Roadmap 2030 announced by the Prime Minister Narendra Modi and Prime Minister Boris Johnson in May 2021.

During negotiations, both Governments will consider the option of an Interim Agreement that generates early benefits for both countries. In parallel to trade negotiations, the India-

UK Joint Economic and Trade Committee will continue to work in improving the India-UK trading relationship and addressing market access barriers outside of a trade agreement.

Both parties have agreed that the first round of negotiations will begin on 17 January, and future rounds of negotiations will take place approximately every five weeks.

The ambition of both countries is to negotiate a broad agreement that will deliver for businesses and consumers. India is currently the world’s sixth-largest economy but ranks only 30th as an export destination for UK financial services exports as of 2020. UK services exports to India amounted to almost £3.8bn in 2020, with financial services making up £296m of that total. With a population of 1.4bn in 2020 – more than a tenth of whom have English as a second language – and projections of rapid economic growth over the coming decades, India is a vast potential market with which the UK can partner to deliver shared prosperity.

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Bulletin is just one of the many insights and publications PIMFA produces on the latest industry news and issues - most of which are accessible to PIMFA members only.

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