Views on improving the integrity of global capital markets
10 May 2016

Our Asset Manager Code Meets Investor, Industry Needs, But Don’t Ask Us…

Posted In: Asset Manager Code
Image Source: CFA Institute

May is turning out to be a busy month for events and actions that support the CFA Institute Asset Manager Code of Professional Conduct (the Code).

Influential pension plan sponsors, including CalSTRS, CalPERS and PRIM, have “signed on” to a letter expressing support for the Code. The letter is being published in major media outlets in North America this week, in conjunction with the CFA Institute Annual Conference taking place now in Montreal, and with May being our Putting Investors First Month.

This is on the heels of institutional investors ranking ethical standards as the most important attribute of a firm, according to findings of our recent “From Trust to Loyalty: A Global Survey of What Investors Want.”

Major Endorsement

Under our “open letter” campaign to promote the Asset Manager Code, influential pension plan sponsors have signed a letter that, in part, states: “We, the undersigned leading North American pension plans, wholeheartedly encourage investment management firms to embrace the standards set forth in the Asset Manager Code of Professional Conduct. We are convinced that doing so sends a powerful message to our employees, our business partners, and our stakeholders who count on us to wisely manage the assets entrusted to our care.”

This letter, with the list of signatories, is being published in the Wall Street Journal, Pensions & Investments, Toronto’s the Globe and Mail, and the French language Le Devoir. The goal of this initiative is to raise awareness of the Code among investment managers by showing that distinguished asset owners are interested in having their managers adhere to the standards set forth in the Code. We believe that a public and united show of support for the Code by a significant set of asset owners will spur managers to consider compliance with the Code. The signatories include the following:

  • CalPERS (California Public Employees’ Retirement System)
  • CalSTRS (California State Teachers’ Retirement System)
  • IMRF (Illinois Municipal Retirement Fund)
  • Pension Reserves Investment Management Board (PRIM)
  • Florida State Board of Administration
  • Caisse de dépôt et placement du Québec
  • Virginia Retirement System
  • Washington State Investment Board

Far from being a one-time occurrence, CFA Institute is planning to make this campaign an ongoing initiative to allow other asset owners and pension plans to join the “original signatories” to show their support of the Code. More information on how to join the initiative will be forthcoming.

Bringing Firms Effective, Cost- and Time-Saving Compliance Tools

In addition to the open letter, CFA Institute has partnered with the Regulatory Compliance Association (RCA) in creating an Asset Manager Code webinar series and implementation platform. These webinars, part of the RCA’s Practice Edge Compliance Transparency Program, educate investment managers on how they can implement the Code at their firm. Each of the five webinars covers a particular area of the Code. The webinars bring together experts on the Code with representatives from firms that have already implemented the Code and who can provide practitioner experience on implementing the Code. Faculty include representatives from BlackRock, T. Rowe Price, MFS Investment Management, Voya Financial, Sterling Investment Partners, New Amsterdam Partners, and TD Asset Management. This is an exciting new educational opportunity and an excellent chance for firms to get practical advice on implementing the Code. After the webinar series has concluded, RCA will incorporate the content into an Asset Manager Code Implementation Platform, an online product that will provide a step-by-step tutorial, as well as the RCA’s 350-page Model Compliance Manual, to greatly reduce the time, effort, and expense for a firm to come into compliance with the Code. We believe that this webinar series and implementation platform will go a long way toward increasing compliance with the Code.

These and other initiatives are paying dividends. There are now more than 1,300 firms that claim compliance with the Asset Manager Code. Notable recent compliant firms include MFS Investment Management, T. Rowe Price, and PIMCO. We currently have 25 of the top 100 global asset managers complying with the Asset Manager Code (74 comply with the GIPS® standards). Our three-year goal is to increase that number to 50 of the top 100 firms with 1,600 total firms in compliance.


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Image Credit: CFA Institute

About the Author(s)
Jon Stokes

Jon Stokes is the Director of Ethics and Standards Education at CFA Institute. His responsibilities include design and creation of on-line ethics education, development and maintenance of the CFA Institute Code of Ethics and Standards of Professional Conduct, and the design and management of the CFA Institute Ethical Decision-Making and Giving Voice to Values education programs. Stokes holds a JD degree.

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