PTL Blog

Tour de FCA

Posted by Colin Musgreaves on Jul 13, 2017 10:15:00 AM

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No doubt the second biggest event of the summer has been the release of the FCA Asset Management Study, albeit that it is a long way behind the start of the Tour De France - but they have something in common.

Among the main recommendations of the FCA Study are a change to box management practices, amending guidance to enable investors to be moved to better value share classes and a mandatory requirement for current AFM Boards to have a minimum of two Independent Directors. These are intended to make the Asset Manager provide the best value for money for their investors.

The new Independent Director roles will be really interesting but you may ask what have they got to do with The Tour De France?

In Le Tour, although only one man gets to wear the leader’s Yellow Jersey at the end of each day, it is very much a team event. The man in yellow relies heavily on his team mates and in most cases these teams consist of riders with different skill sets – climbing, descending and time trialing, to help the team leader reach the podium at the end of the race. Team effort not a token effort.

The AFM Boards of Asset Managers should consider this winning formula. Similar candidates from the investment world may not work. The Chair should be tasked with putting together a strong team of individuals, with complimentary abilities to help them deliver the best possible value for money to their investors.

AFM Boards who do this will be the winners and get to wear yellow. Lycra shorts are an optional extra.

 

Topics: Defined Benefit, DB Risks

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