The Financial Conduct Authority’s reforms of the asset management sector are encouraging companies to invest in the UK, one of the regulator’s executive directors has said.
Speaking in the USA at the annual meeting of the Securities Industry & Financial Markets Association, Christopher Woolard, director of strategy and competition at the FCA, said the watchdog’s reforms could have a positive impact as the City of London enters a “new phase” post-Brexit.
Mr Woolard said: “I have to say that since the final report was published, we have received support from many in industry, public policy and beyond.
“A cynic might say that may be because the principles of transparency, value for money and acting in the best interest of investors they are hard to disagree with, at least in public.
“Without appearing to be naïve, I like to think it’s also because many are starting to see the positive impact these reforms could have.
“Particularly as we enter a new phase for the City. I’ve certainly been told by one major US group that they are choosing to invest in the UK precisely because of our regulatory reforms.
“It’s not a stretch to say that today the question of how the UK maintains its competitive edge is top of mind for many.
“One thing we do know is that a race to the bottom benefits no one.”
Mr Woolard re-iterated his claim, made previously to a Parliamentary committee, that a “bonfire of regulations” after Britain leaves the European Union would be counterproductive.
The FCA published the final report of its asset management paper earlier this year.
The package of measures unveiled by the watchdog, designed to ensure retail investors get value for money, included rules to require firms to introduce two independent board directors, to do more to ensure benchmark presentation is accurate and to pass on economies of scale more effectively.
The regulator also said it continued to back the idea of a single all-in fee for fund investors.
Mr Woolard said the importance of these reforms was highlighted by the number of people reaching retirement age, with this reaching 17m by 2050.
He said: “The integrity and efficiency of the asset management industry will have a profound effect on the financial future of these people and many others. As an industry you are going to be more important than ever.
“We want them to see an industry where competition works effectively, where they can compare between managers and choose the one that best meets their needs, and where they know what services they’re paying for and how much they’re paying for them.”
News source: FT Adviser