So, happy new year and all that. First full week back. Yay.
Whilst everyone was off eating/drinking/bravely battling #manflu (delete as appropriate) the investment industry got on with the small matter of the implementing MIFID II. For a lot of folk this was a huge project, described to us yesterday by someone who had lived through both, A-Day and RDR as the most challenging project he has been involved in.
For most of last year everyone was saying ‘MIFID is coming, get prepared’ and as the year progressed most people were starting to raise concerns about the overall level of readiness. The regulation managed to achieve the impressive state of being both vague and massively over-engineered. Providers struggled to get the level of detail needed to plan the changes required, and with providers not being clear on what is happening the resulting level of awareness amongst advisers is patchy at best.
All of this has meant that whilst most providers/fund groups etc have ‘ticked the box’ to be MIFID compliant, there are a number of inconsistencies in approach. For example, some providers are implementing the rules to cover all products (and creating a consistent process), others are sticking with the letter of the law and going for investment products only. Some providers will notify the end client if/when there is a 10% fall on a discretionary portfolio, others notify the adviser. Add in inconsistencies with LEIs, complex products and funds without PRIIPs KIDs etc etc and it’s a bit of a mess.
Now here’s the thing. Most, if not all of these issues will quickly wash away as the industry and advisers get to grips with what has changed. However realistically advisers are going to find that different providers are handling things in different ways. And with most adviser firms using a number of platforms/providers this is inevitably going to create an inconsistent process. Everyone is technically compliant, but boy is it a PITA for advisers.
Already this week the various lang cats have had a number of calls from trade journos who are looking into these inconsistencies. In a couple of cases these have been initiated by a platform provider’s PR team attempting to take the moral high ground, and show how their approach is better than their peers. Any provider thinking this might be a good idea would be worth spending their time and efforts elsewhere. You are not going to win advisers hearts by the way you calculate fund spreads in a KID document, or how you handle the 10% rule, but if you give advisers clear information about what your system is doing and help them through these changes you will. Spend less time trying to bash the competition, and more on helping the community you seek to serve.
And with that in mind, here are a few links (in no particular order) to decent resources for various providers. If your fav provider isn’t shown it means they either haven’t got any publicly available info (booo) or I haven’t found it yet. If it’s the latter, please let me know and I’ll add it to the list.