PIMFA Weekly News Bulletin - 20 September 2021

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PIMFA WEEKLY NEWS BULLETIN | 20 September 2021 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 meeting with FCA RE: Appointed Representative (AR) regime

The FCA has agreed to meet with PIMFA member firms who operate AR models to help inform their ongoing work looking at the AR model and their upcoming consultation. This is a unique opportunity for member firms to feed in the practicalities of their model to the FCA and potentially inform some of the recommendations that they put forward in their forthcoming consultation.

The meeting will take place on 29 September at 14.00, please contact Simon Harrington if you would like to attend.

Talent, Diversity and Inclusion within the Wealth Management & Advice sector

Talent, Diversity and Inclusion are a high priority for CEOs in the sector, according to CEO sentiment surveys PIMFA have conducted over the past 18 months. In order to understand the make-up, challenges and current activities of firms, we have compiled a simple survey, based on data that we believe firms may have gathered. The questionnaire is timely given the publication of the Discussion Paper from the FCA/PRA/BoE on diversity and inclusion. Data is key to understanding the picture in the sector and any required action.

We would really appreciate if HR colleagues or other individuals in the wealth management sector firms would provide response to the survey.

All information received will be aggregated and anonymised by PIMFA staff. Individual company data will be stored securely and not shared in any way. The data required by the questionnaire will be harder to provide for some firms, particularly smaller ones. However, even incomplete data will be useful. No matter where your organisation finds itself and how advanced your people data or diversity and inclusion initiatives are, providing responses will help obtain an accurate picture. The purpose of gathering this data is to inform initiatives we can undertake together as an industry, to promote the sector more broadly and to identify gaps where collective action can be undertaken.

The link to the survey can be found here. If you have any questions, please get in touch with MajaE@pimfa.co.uk

Take the short survey

Latest PIMFA Press Releases

PIMFA Comments on FCA’s plan to tackle investment harm

Latest PIMFA Press Coverage

BBC: FCA signs up celebrities to warn of investment risks

PIMFA launches ESG Academy for Wealth Managers Government proposals for social care merit

Reuters: UK watchdog unveils blueprint to turn tide of financial scams

further consideration – but system remains highly complex and may lead to significant costs for individuals FCA Consumer Duty must be accompanied with clarity for firms and understanding of their business models PIMFA welcomes FCA proposals to streamline decision making

Professional Adviser: The business case for diversity is clear - yet advisers are slow off the mark

FT Adviser: FCA director explains 10-year FSCS levy strategy

Citywire New Model Adviser: Consumer duty could be the thin end of the wedge for fee reform

Virtual Associate Members Briefing

21 September 2021 16:00 - 17:30 FREE for Associate Members - Virtual Event We will explore topics such as regulation, operations, latest industry developments and provide an opportunity to discuss with PIMFA staff specific issues important to the membership.

This event also showcases our ongoing events and publications programme providing examples of how Associates can engage with Members and maximise the value they receive from their membership.

Attendees will also benefit from networking opportunities with other industry professionals in a virtual format.

This event is free for PIMFA Associate Members. To book your place please go to tickets and complete the registration form. If you have any questions please email us on events@pimfa.co.uk

BOOK YOUR FREE PLACE

View other upcoming PIMFA Events and Learning here.

PIMFA's Consultation Responses

PIMFA’s latest Consultation Response is to the FCA's CP21/17: Enhancing climate-related disclosures by asset managers, life insurers, and FCA-regulated pension providers.

Read this and all other PIMFA consultation papers here.

Registering with the ICO and Paying the Data Protection Fee

The Information Commissioner’s Office (ICO) is the UK regulator for data protection and information rights. In September 2021, they will be writing to the finance and insurance sector to remind firms that they may have a legal responsibility to register with the ICO and pay the data protection fee. For most companies this is £35 or £55 per year when they pay by direct debit.

If you receive a letter, you should check if you need to pay and, if you believe you are exempt, you should let the ICO know by 8 October 2021. If you are not exempt, you will

need to register through their website and pay the fee. If you don’t receive a letter, you may still be legally required to register so you should take steps to check whether you need to pay the fee. There is more information specifically for care organisations the ICO’s website: Paying a data protection fee – finance and insurance

They also have a web hub designed for small and medium enterprises which has lots of tips and simple guides that you will find useful: SME web hub – advice for all small organisations | ICO

ICO’s SME Feedback Group

The ICO is inviting small organisations, including sole traders and small businesses, to be part of its SME online feedback group. As a member of the group, you’ll be contacted up to four times a year and asked for your views on some of the ICO’s products and tools before they’re launched. You can find more information about what this involves in the ICO’s privacy policy. If you are interested in participating, please email dpcommunity@ico.org.uk with the subject line “SME feedback group participant” or contact the ICO via the SME feedback group application form.

Responses to the Treasury Committee’s Fourth Report on the FCA’s Regulation of London Capital & Finance

The Treasury Committee has published responses from the Treasury and the FCA to its Report on the Financial Conduct Authority’s Regulation of London Capital & Finance plc (LCF). The Treasury Committee launched its inquiry into the FCA’s regulation of LCF in February 2021, in order to consider Dame Elizabeth Gloster’s findings, examine the changes that have been made since the publication of her report, and to make further recommendations to the FCA and HM Treasury.

Commenting on the responses, Mel Stride MP, Chair of the Treasury Committee, said that the collapse of London Capital and Finance (LCF) had severely impacted many investors and highlighted considerable regulatory failings. He welcomed the Treasury and the FCA’s positive engagement with the Committee’s recommendations. However, he also added

that “it is not yet clear whether the Government will include fraudulent advertisements within the scope of the Online Safety Bill. To prevent fraud in the future, this is an issue which must be addressed.” The Committee’s recommendations can be found here.

Government Launches Plans to Capitalise on New Brexit Freedoms

New plans to capitalise on the freedoms from Brexit so that UK rules and regulations best serve the UK national interest have been announced on 16 September by Minister of State at the Cabinet Office, Lord Frost. Thousands of individual EU regulations – known as Retained EU Law – will be scrutinised by the Government to ensure they are helping the UK to thrive as a modern, dynamic, independent country and foster innovation across the UK economy.

The review will aim to remove the ‘special status’ that EU retained law still enjoys in our legal framework and will determine how best to ensure that UK courts can no longer give undue precedence to EU-derived laws in future. The Government also plans to establish a new Commission through which the public will be able to identify additional opportunities for cutting or reforming red tape and bureaucracy. The proposals include dematerialisation of shares. Although the majority of shares are held in electronic form, a minority are held in paper form. The Government will work with industry, regulators and shareholders in the medium term to determine the best mechanism for converting these paper shares into electronic form, while preserving the rights of existing shareholders. The full list of reforms can be found here.

FCA’s Proposals for a New Listing Regime

Speaking at the City and Financials’ event on 'The Modernisation of the Listing Regime', Clare Cole, FCA's Director of Market Oversight, said that the UK Listing Review, chaired by Lord Hill, had achieved unprecedented support, across all parts of industry, for the need to reform of the listing regime. She said that the FCA is committed to seizing this opportunity to make the listing regime more agile and more flexible. To this end the FCA wants to ensure it is suitable for the types of companies that are coming to market in today’s economy, so investors, be they institutional or retail, are able to share in the growth of

these new and innovative companies.

Cole added that the FCA consultation on the Primary Markets Effectiveness Review covers some specific reforms to the regime that the regulator would like to bring about quickly: a targeted approach to allowing dual class share structures in the premium segment, a reduction in the level of free float to 10%, measures to improve investor trust and confidence in the types of companies on different markets, by raising the minimum market capitalisation required for listing on the main market to £50 million. This is only the beginning of the process of reform as the FCA will be engaging with stakeholders across industry, in order to work together to redraw the picture of public markets in the UK, as efficiently and collaboratively as possible.

The Future of International Data Transfers

The IRSG and KPMG have been working together to prepare a joint report on ‘The Future of International Data Transfers.' The report will cover the current scenarios regarding international transfers of data, define why it is important that the financial services sector is able to continue to transfer and access data across borders, and what the future of international data transfers will look like.

In order to support the report with real data and statistics from companies operating in the financial services sector, they are requesting that people in the following roles take a short survey to share their thoughts about international data transfers – a topic of increasing business, technological, operational and political interest.

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Chief Compliance Officer

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Chief Data Officer

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Chief Information Officer

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Chief Information Security Officer

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Chief Operations Officer

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Chief Privacy Officer

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Chief Risk Officer

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Chief Technology Officer

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General Counsel

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Legal Counsel

Most of the questions are multiple choice, and the survey should take approx. 8-10min to complete. All responses will remain completely anonymous.

Take the survey

City of London/KPMG Report on International Services Trade

International services trade will be a vital component in meeting net-zero goals and trade in ‘environmental services’ is growing and changing rapidly. As ESG policy takes on increasing importance, it is crucial to explore how best to liberalise trade in ‘environmental services’ in support of the green agenda. As the first step, the City of London Corporation commissioned KPMG UK to examine the state of play. The resulting report, “International Trade in Environmental Services: Barriers to trade and recent approaches to liberalisation” provides an overview of existing definitions for environmental services, barriers to trade, and recent attempts at liberalisation. The study focusses on three related areas: understanding environmental services: barriers to trade in environmental services and recent approaches to liberalising the trade in environmental services.

Job Vacancies Hit a Record High as the Economic Recovery Continues

The most recent data show the labour market continuing to recover, according to the Office for National Statistics. The number of payroll employees showed another monthly increase, up 241,000 to 29.1 million in August 2021, returning to pre-coronavirus (COVID19) pandemic (February 2020) levels. All regions except London, Scotland and South East are now above pre-pandemic levels. The number of vacancies in the three months to August rose above one million for the first time since records began in 2001. In the latest period (May to July 2021), there was a quarterly increase in the employment rate of 0.5 percentage points, to 75.2%, and a decrease in the unemployment rate of 0.3 percentage points, to 4.6%. The economic inactivity rate is down 0.3 percentage points on the previous quarter, to 21.1%.

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