Up to 25 local fund managers have thrown their support behind moves to strengthen a semi-formal industry lobby group.
The as-yet-nameless body, which significantly expands on an existing boutique manager discussion group, brings together non bank-owned investment firms to liaise with government and regulators as well as collaborate on common issues.
Simon Haines, the Nikko Asset Management NZ general counsel who has convened recent meetings, said the group had seen growing interest from managers over the last 12 months, triggered mainly by regulatory changes. (In fact, Haines’ colleague, Tim Morrison, Nikko head of compliance, helped establish the forum following the introduction of the licensed managed investment scheme regime several years ago.)
Haines said, for instance, that the potential extension of the imminent financial institution conduct legislation to fund managers was a rallying point last year.
The non-bank fund management sector has also been drawn closer together during the coronavirus era, he said.
“The COVID-19 crisis has driven the industry to become more connected,” Haines said. “During the lockdown we were meeting [online] every fortnight to discuss regulatory and market issues.”
Between 20 to 25 fund managers have been regularly attending the meetings during lockdown under the colloquial ‘Coro Club’ banner, prompting moves to establish a more permanent structure for the group.
“But we want to keep our agility rather than present a single voice,” he said. “If any managers don’t agree with any submissions we may put together they don’t have to put their name to it.”
For example, most of the members signed a joint submission on the conduct bill while a smaller sub-set put their name to an official response on new carbon disclosure rules. And while competitive differences ruled out a unified submission on the KiwiSaver default scheme proposals, the group did meet government officials to channel their various views on the matter.
Despite the new-found enthusiasm for collaboration, the diverse assembly of fund managers likely won’t morph into a full-blooded association, Haines said.
However, he said the manager forum will shortly agree on a name and probably develop a website.
Haines said aside from the COVID-19 disruption, top of the agenda items for fund manager members include the upcoming climate change reporting rules and the new Financial Market Authority (FMA) levies.
“The FMA levy changes are a bit of a contentious issue,” he said. “MIS [managed investment scheme] managers have to pay a lot to supervisors to ensure compliance and this doesn’t seem to have been acknowledged in the new levy schedule.”
While forum membership is limited to the non-bank fund manager sector, Haines said it would collaborate with the wider industry body, the Financial Services Council (FSC), where appropriate.
“We will do things with the FSC but our aim is to represent the specific interests of fund managers,” he said. “The FSC has a much broader approach.
“Overall what we are trying to achieve is a group that; can accommodate the fact that we are competitors with different styles and values, and that can be really flexible in how it responds.”
The forum will likely meet every month.