UK independents: lipstick on a pig?

The NED’s review of AFMs (authorised fund managers) suggests that the FCA’s requirement to include two independents on UK manager boards will achieve little. The key to the FCA’s reforms is the value assessment. That is something that independents are unlikely to be able to influence a great deal.
The annual assessment of value includes a requirement for UK asset managers to make a justification of their fees, fund by fund. Where will the information that is used to make this assessment come from? It is almost certainly going to come from the manager, or from an outside firm that the manager will appoint to do the job. Either way it is unlikely that the independents on the board will have much influence over it. They are part-timers and are likely to make up 25% of board only.

To read more on this story see the March issue of The NED.