A Cayman Islands based firm has welcomed proposed changes to the governance of UK Authorised Fund Managers (AFMs). DMS Governance hailed the proposed changes, which were published in response to a Financial Conduct Authority report that highlighted a number of concerns with the governance of AFMs.
Under new regulation, AFMs will be required to appoint a minimum of two independent directors to their boards and for at least 25% of the board to be formed of independent, non-executive directors. There is a hope that the inclusion of independent directors will give governing bodies a more defined role, increasing accountability and resulting in better outcomes for investors.
Were the new regulation to be successful it would provide a clinical response to the issues laid out by the Financial Conduct Authority, which highlighted the importance of protecting investors..
Don Seymour, Founder and Managing Director in the DMS Cayman Office, said, “This FCA proposal is the most consequential in over a decade for the fund governance industry, since the SEC fund governance rules enacted in 2004. It would deliver really positive benefits for fund investors seeking greater performance and accountability from fund directors.”
News source: CNS