Fund managers sound alarm over fragmenting regulation
Top fund management executives have voiced concerns that fragmented regulation will hold them back, as asset managers try to balance the demands of a highly interconnected investment industry against retreats from globalisation.
Regulation of the fast-growing sustainable investment sector is an area of concern. European regulators took a lead on defining standards for so-called environmental, social and governance investing this year, with the Sustainable Finance Disclosure Regulation, which aims to improve transparency and prevent greenwashing. But the UK is consulting on its own version of rules, which could take a different approach to the EU in the aftermath of Brexit.
“It’s great that the [UK] regulators are consulting on this stuff, but it is our fear that we’ll have a separate set of rules,” Patrick Thomson, chief executive for Europe at JPMorgan Asset Management, told the Financial Times Future of Asset Management event Wednesday. “My big concern is around the federalisation or fragmentation of regulation. Adding complexity to fit a local narrative might not be the best outcome for customers,” he added.
For investors, being able to assess the impact of economic shifts across supply chains has been essential to valuing companies this year, whether from spiralling energy costs or changing production patterns.
“We’ve got a large number of analysts around the world who are able to make informed decisions on companies in China and Taiwan, and other parts of the world who are producing goods, services and equipment for companies in the US or in Europe,” said Thomson.
This story originally appeared on: Financial Times - Author:Harriet Agnew
