PIMFA Fortnightly News Bulletin - 8th October 2018

PIMFA - Building personal financial futures

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PIMFA Fortnightly News Bulletin - 8th October 2018 Welcome to the PIMFA Bulletin, our fortnightly e-newsletter delivering a snapshot of the latest news and current affairs from within PIMFA and the industry.

What is PIMFA working on?

PIMFA publicly raises concerns over potential shareholder disenfranchisement from Unilever vote PIMFA has publicly raised concerns over the potential shareholder disenfranchisement that could have resulted from the Unilever Plc vote regarding their proposal to relocate their headquarters in The Netherlands.

In a spate of high exposure press interviews with the Times, The Daily Mail, The Evening Standard, The Independent and various trade publications, PIMFA voiced industry fears about the guidance issued by Unilever which stated that if retail investors holding their shares in a nominee company wished to participate in the vote they would have been required to apply to their broker or wealth manager to certificate part of their shareholding. This would have been a mammoth logistical issue to convert thousands of holdings in time for the vote in 3 weeks and raised high levels of alarm as this cannot be done from an Individual Savings Accounts (ISA) or other tax-incentivised account.

This industry-wide issue would have affected approximately 36 000 UK personal investors many of whom use nominee-based retail investment services and this guidance would have denied members who hold their shares through nominees their entitlement to exercise a shareholder right under Section 152 of the Companies Act. If Unilever proposal had gone ahead the company would have dropped out of all UK stock indices, including the FTSE 100 and FTSE Allshare, which in turn would force UK tracker funds and other institutional investors to sell their holdings.

Following public pressure, Unilever announced (Friday 5th October) that they are abandoning the move and ensuing vote.

PIMFA at the Party Conferences PIMFA CEO Liz Field attended the Labour Party and Conservative Party conferences with colleagues from UK Finance, City of London Corporation and TheCityUK, listening to speeches from Barry Gardiner MP, Shadow Secretary of state for International Trade and from Sir Graham Brady MP, Chairman of the 1922 Committee and which included fringe events on skills and inter-generational wealth transfer.

Pension Transfer Advice The FCA has published its final policy statement on pension transfer advice. This policy statement represents something of a victory for PIMFA who’s headline input into this broader consultation has been adopted. In our view, these proposals will improve the quality of advice going forward by raising standards and improving clarity for advisers. The new rules and guidance include: •

raising qualification levels for pension transfer specialists (PTSs) to require them to obtain the same qualification as an investment adviser alongside the existing PTS qualification

•

guidance to clarify our expectations that advisers should be exploring clients’ attitudes to the general risks associated with a transfer, in addition to their attitude to investment risks

•

guidance to illustrate how firms can carry out an appropriate ‘triage’ service (an initial conversation with potential customers), without stepping across the advice boundary, by providing generic, balanced information on the merits of pension transfers

•

a requirement for firms to provide a suitability report regardless of the outcome of advice

•

updating the assumptions to be made when valuing increases applied to defined benefit (DB) scheme benefits, where there are upper and lower limits applying to inflationary pension increases

We will shortly be distributing a formal note outlining these changes which came into effect on 4th October 2018.

You can listen to PIMFA's Senior Policy Adviser Simon Harrington discussing this issue on BBC Radio 4's MoneyBox live programme here.

The Packaged Retail and Insurance-based Investment Products (PRIIPs) Update The European Supervisory Authorities (ESAs) have written a letter to the European Commission outlining problems which the ESAs identify with the PRIIPS KID and the UCITS KIID. They also called for a targeted reform of the KID with proposed amendments to the Delegated Regulation due in Q1 2019. Contents of the letter include: •

Duplicate Requirements: The ESAs raise concerns that since the UCITS exemption to PRIIPs Key Information Document (KID) runs out at the end of 2019, at that point UCITS funds will have to publish the KID alongside the current Undertakings for Collective Investments in Transferable Securities (UCITS) Key Investor Information Document (KIID) which could potentially deter investors from using either document. Furthermore the difference in methodologies underpinning the presentation of risks, performance and

costs in both documents mean that the UCITS KIID and the PRIIPS KID cannot be effectively used together.

•

Legislative Changes: The ESAs support legislative changes to avoid duplicate information requirements. This includes a review of the PRIIPS Commission Delegated Regulation and potentially a wider review to address all of Article 33 in the PRIIPS Regulation.

Next Steps As part of the review process, the ESAs will begin a stakeholder consultation in Q4 2019 examining priority issues including Performance Scenarios in the PRIIPS KID and issues addressed in Q&As. The consultation will end before the end of the year with proposed amendments to the Commission Delegated Regulation expected in Q1 2019. If the Commission is supportive, these proposals may be adopted in Q2 2019, contingent on the Parliament and Council’s non-objection in the following two months.

PIMFA have responded to the FCA's call for Input - the paper can be read here.

We have also issued a press release outlining our concerns - this can be read here.

NEW! – Indices Portal On a quarterly basis we survey our member firms for their latest strategic asset allocations. This data provides the methodology for asset allocation changes to the MSCI WMA Private Investor index series. Our new dedicated Indices Portal provides an easy and secure location for firms to update us with their asset allocations. Overtime, this portal will also provide users with exclusive information and additional benefit.

If you would like to find out more about the PIMFA Indices Portal, contact our Indices team via indices@pimfa.co.uk or call us on 020 7011 9866.

New PIMFA Member Firms We are pleased to welcome two more new members to PIMFA and look forward to working with you.

Enforcd - Global regulatory intelligence platform

Mole Valley Asset Management – Discretionary fund manager

PIMFA Consultation Responses PIMFA responds on behalf of our membership to numerous key issues within our industry. We do this via vital feedback and discussion with member firms. From this member feedback PIMFA create responses to consultation documents and discussion papers issued by bodies such as the UK’s regulator, the Financial Conduct Authority (FCA), Government departments and many European and International bodies.

The scope of regulation is increasing and one of PIMFA’s key objectives is to ensure this regulation is proportionate and fair, bringing real benefits to the investment management and financial advice community and their clients.

Read PIMFA's Consultation Papers Here

What's coming up in PIMFA? PIMFA CPD Seminar: Culture And Conduct – Practical Insights and Challenges when Assessing And Documenting your Culture Wednesday 10 th October 2018 Crowe Global Risk Consulting, 1 Carey Lane, London, EC2V 8AE

CPD:1.5 hrs With an increased regulatory focus on the corporate culture of businesses, the speakers will be discussing the relationship between behaviours and the company culture.

This seminar is a must attend for members looking for guidance on expectations of the regulators including new regulations that are expected to impact the culture.

Speakers will also discuss behaviours influencing the culture and culture influencing behaviours with case studies on how to assess and improve the culture.

Sign Up

PIMFA Brexit Conference 2018 Thursday 11th October 2018, 09:00 – 16:00 Central London Venue CPD: 3.5 hrs As we approach Britain’s planned exit from the EU on 29th March 2019, there still appears to be much uncertainty over the outcomes of the final agreements.

Expert speakers will help shed light on the current situation and what to expect going forward as we leave the EU. Topics will include: •

The State of Play and Future Prospects

•

The Future Relation: The UK as a 3rd Country

•

HM Treasury: No Deal and Financial Services

•

Role of Financial Regulators

•

Advice, Access, Permissions, and Reverse Solicitation: the Private Client Situation in Other EU Member States

•

The Position of PIMFA Firms and Clients

Sign Up

CPD Seminar: Getting the CPD Seminar: DB to DC Best from Data In Today’s Pension Transfers World Edinburgh Thursday 18th October 2018 Thursday 25th October 2018 The Ivy Garden City, Dashwood House, 69 Old Broad Street,

Royal London, 1 Thistle Street, Edinburgh, EH2 1DG

London, EC2M 1QS

Free for Members

Free to members CPD: 1 hr

CPD: 2 hrs Marc Michaels, Director of Strategy at

Designed specifically for advisers, this

seminar will help identify the relevant risk Paragon Customer Communication will factors associated with pension transfers. discuss practical solutions to help attendees get the best from their data.

Attendees will also learn to recognise how Key discussion points include re-

market forces and pensions freedoms have

impacted consumer interest in pension engineering the customer journey based on transfers as well as learning how to design thinking, cobined with deep document their advice process in line with analytics to provide insight and machine requirements of the regulator. learning applications for communications.

Sign Up

Sign Up

PIMFA Annual Summit 2018 31st October 2018, 08:30 – 19:30

ETC Venues Bishopsgate, 155 Bishopsgate London EC2M 3YD 6 CPD Hrs The PIMFA Summit 2018 is an opportunity to gain a comprehensive understanding of the key issues impacting the investment management and financial advice sector.

Hear from the leading figures across the world of business, finance and politics such as advisers to HM Government, FCA and the Vice Chairman of Economic and Monetary Affairs Committee in European Parliament.

Keynote speakers include: •

Sir Trevor McDonald OBE, Veteran ITN Presenter

•

Richard Charnock, CEO, Standard Life Wealth

•

Dr Eliza Filby, Visiting Lecturer, Historian of Contemporary Values, King’s College London

•

Dr Kay Swinburne, Vice Chairman of Economic and Monetary Affairs Committee, European Parliament

•

Catherine McGuinness, Deputy (Chairman), Chairman of the Policy and Resources Committee, City of London Corporation

Book Now

Leading in a Regulated Environment New training course launched by Ashridge Executive Education in partnership with PIMFA Leading regulated businesses is difficult and requires a special kind of leader with the personal, organisational and commercial expertise to cope with operating under the regulatory spotlight. This spotlight has intensified with the introduction of a

personal accountability regime for Senior Managers by the FCA and PRA and their increased focus on the capability and performance of senior management and leaders.

In response to this, Ashridge Executive Education, specialists in international leadership development, in partnership with PIMFA, are launching a unique leadership masterclass. This is the first of its kind in the UK and stems from research into what differentiates successful leaders in regulated businesses. The course uses a blend of face-to-face and virtual learning using case studies, visiting speakers and simulations to help develop the insights, skills and mind-sets needed to lead in in a regulated environment.

PIMFA members are offered an exclusive rate when booking this course - please quote PIMFA 1010.

Find out more at: http://www.hult.edu/en/executiveeducation/landing/global/leading-in-a-regulated-environment/ To book: +44 (0) 203 318 6437 / info@ashridge.hult.edu

Date: Two day course - 28th to 29th January 2019 Fee: ÂŁ2,990 (PIMFA members) / ÂŁ3,350 (non-PIMFA members) not inclusive of VAT Discount: Quote code PIMFA 1010 to get the exclusive PIMFA members price Venue: Ashridge Executive Education, Ashridge, Berkhamsted HP4 1NS Tutor: Gary Storer MA (Cantab), MBA, MSc, Programme Director & Faculty Ashridge Executive Education

What's happening in our industry?

Invitation to Innovating for a greener Great Britain 19th October 2018 Financial Conduct Authority, 12 Endeavour Square, London E20 1JN

As part of Green GB Week, an annual week designed to highlight and promote opportunities to reduce emissions and grow the low carbon economy, FCA are inviting you to Innovating for a greener Great Britain on Friday 19th October. The event will take place in their new, sustainable building in Stratford, London E20.

Join other industry leaders to hear how FCA Innovate is encouraging financial services to play a positive role in assisting the global climate effort.

During the morning FCA will:•

Highlight key aspects of our work relating to climate change

•

Hear from Julian Critchlow, Director General for Clean Growth from The

Department for Business, Energy and Industrial Strategy (BEIS) •

Explain how FCA Innovate can support firms seeking to develop innovative

financial products and services in green finance and ethical investing •

Showcase companies who have already developed green finance products and

services •

Discuss and debate challenges and opportunities facing the green finance

market

For further information and to register your place, please visit the FCA event booking pages.

Find out more about Green GB Week here.

For booking enquiries please contact eventsbooking@fca.org.uk.

Sale of US Over The Counter Stocks PIMFA has been approached by a UK private investor who holds some US OTC stocks and is looking for a firm to sell these investments.

If your firm may be able to help, or you would like more details, would you please contact Kevin Sloane.

pimfa.co.uk

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