In addition, the director will liaise with the FCA on behalf of the fund and also with the depositary – the institution that has responsibility for safeguarding the fund’s assets.
Finally, the director has the important role of assisting fund sponsors to understand and keep up to date with regulatory change, know what is required of them and take the actions necessary to comply.
Anyone familiar with the financial services industry will be aware that the pace of regulatory change is significant, so again this can be demanding in terms of expertise and resources.
Fund sponsors will want to be certain their ACD is capable of handling this level of regulatory change.
For example, the remedies announced by the FCA after the Asset Management Market Study introduced a number of new requirements for funds and authorised corporate directors.
These include steps to ensure fund objectives and benchmarks are clear, the introduction of value assessments and new requirements for independent representation on authorised corporate director boards.
While the full extent of the director’s responsibilities will not always be apparent to those not directly involved, the role has never been more important.
The director’s independent stewardship of funds is fundamental to protecting the best interests of investors.
Wayne Green is joint managing director of Investment Fund Services Limited
