The Investment Management Association (IMA) is putting out a consultation paper to members on a code...
The Investment Management Association (IMA) is putting out a consultation paper to members on a code of practice for disclosing charges to pension fund clients.
Its proposals are for a two tier level of disclosure to pension fund trustees, with the first level including an annual report on factors including the investment house's policy on issues which can affect costs such as selection of share brokers as well as commissions and spreads.
The IMA is also proposing the introduction of half-yearly reports to clients which would show information such as fund management fees, transaction volumes and commissions paid, taxes, bank charges and other costs.
The trade body believes that the level one reports should be available from this year while the level two reports which go into more detail on charges should be available from 2003.
The proposals have been worked out jointly by IMA with the NAPF and are in response to the Myners' Review which, among its recommendations, called for more clarity in the charges investment houses make for running pension fund mandates. Lindsay Tomlinson, deputy chairman of the IMA, said: 'Clearly fund managers will have to supply considerable amounts of information to clients to comply with this code. It is likely that many IMA members will have to undertake significant IT work in order to supply the information.
'Depending on the way in which the consultation progresses, it is quite possible that the draft code will have to be amended. However, I envisage that, in the relatively near future, the IMA will be in a position to finalise this code.'
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