19 April 2012

ECMI Rethinking Asset Management Task Force Report: 'From Financial Stability to Investor Protection and Economic Growth'

This report examines the asset management industry, including its key links with financial stability, product integrity, investor protection and the real economy, and evaluates several legislative proposals on the table, as well as the discussions on product integrity in UCITS and 'shadow banking'.

ECMI launched the final report of its task force 'Rethinking Asset Management' on April 19 at CEPS Brussels. The report comprises four main sections: (1) financial stability and investment management, (2) product structuring and use of derivatives in retail open-ended investment funds, (3) distribution, investor choice and protection, and (4) contribution of the asset management industry to the real economy.

The asset management industry has reached an impasse in the wake of the financial crisis and the extensive, ongoing revision of EU regulation. Much rides on its ability to make investment funds deliver better results to its investors. Distribution remains the major stumbling block, but action is also needed to promote the contribution of asset management to the real economy and to preserve financial stability. In response to these challenges, CEPS and ECMI formed a Task Force composed of market participants, international experts, regulators and academics who met regularly throughout 2011 to closely examine the workings of the asset management industry and its contribution to the EU economy.

This report draws the link between asset management and several key issues: financial stability, product integrity, investor protection and the real economy. It evaluates the many legislative proposals that are currently under consideration – including implementation of the Alternative Investment Fund Managers' Directive (AIFMD), the review of the Markets in Financial Instruments Directive (MiFID II) and Packaged Retail Investment Products (PRIPS) – as well as the discussions on product integrity in UCITS and ‘shadow banking’. In an effort to make these complex issues comprehensible to a broad group of readers, the report combines clear language and straightforward introductions with detailed technical illustrations and analysis.

The report was written by Mirzha de Manuel, CEPS-ECMI Researcher. The Task Force was chaired by Jean-Baptiste de Franssu, Chairman of Incipit and former President of the European Fund and Asset Management Association (EFAMA). Mirzha de Manuel and Karel Lannoo served as rapporteurs.

Link to full report

© ECMI