The head of the Alternative Investment Management Association (AIMA), an alternative investment industry representative body, told PDI that the organisation is “not rushing headlong” into joining a working group on fees and costs proposed by the Financial Conduct Authority (FCA).
At the end of June, it emerged that the FCA was making plans for a working group to discuss ways in which fund managers might better disclose their costs and charges to institutional investors.
The proposal followed a 112-page report on the asset management industry by the UK regulator which had been expected to focus on retail investment but which unexpectedly appeared to bring alternative asset managers into its remit.
However, Inglis said it was not yet clear that the proposals would definitely be extended to the alternatives sector. “Further consultation still needs to happen,” he said, adding that “it’s not clear that a single standardised template that would fit both alternatives and mutual funds is the right way forward.”
There is speculation that the proposals may only apply to UK-domiciled funds rather than those based in offshore jurisdictions and thus outside of the FCA’s regulatory remit. Many alternatives funds fall into the latter category.
The initial surprise at alternatives managers apparently being on the radar led some to call for the industry to make sure it had a voice in any discussions. “My concern is that if alternative asset classes are not represented in the working group they could well find that the output of this working group is very inappropriate for the asset class,” Tamasin Little, a London-based partner and regulatory specialist at law firm Reed Smith, told PDI.
However, Inglis was keen to dispel any notion that AIMA was on the back foot. He said the organisation had been part of the consultation process with the FCA that led to the report and that discussions are continuing. “We don’t feel left out of things at all,” he said.
Inglis said that AIMA has a meeting with fund manager members this week at its Asset Management Consultation Committee, and said he expected the FCA report to be high on the agenda. However he added: “The working group has been talked about a lot but none of our members have said to us that we have to be a part of it.”
On its website, AIMA says it has more than 1,800 corporate members in over 50 countries including hedge fund and private debt fund managers collectively managing more than $1.8 trillion in assets.