Investment Association pursues reporting framework

New code developed by the Investment Association to outlines transaction cost reporting framework.

The Investment Association has launched a consultation on a new standardised transaction costs reporting framework to benefit the buy-side.

The consultation outlines an industry code which provides a blueprint for reporting charges and transaction costs through a market-wide consistent approach.

The buy-side body believes the framework would improve transparency and facilitate the provision of data under MiFID II, although asset managers are tipped for further benefits from the code.

“The asset management industry is fully committed to enhancing transparency. Members have assisted the Investment Association’s technical work in producing this code and have supported the work at all stages,” the consultation said.

The code will ensure buy-side compliance with reporting requirements and could simplify systems built within the asset management industry to ensure consistency across firms.

Chris Cummings, chief executive at The Investment Association, wrote: “Regulators and industry have a responsibility to do better. This code will help that conversation to happen, providing meaningful and reliable underlying data.”

The consultation added it is aware the ongoing asset management market study by the Financial Conduct Authority (FCA) could see further changes to charge and transaction cost reporting, but the regulator supports the association’s initiative.

Following the end of the consultation, feedback will be reviewed and a final set of proposals will be published in the third quarter this year.

The FCA will then be asked to recognise the rules under the conduct of business sourcebook.

Jonathan Lipkin, director of public policy at the Investment Association, concluded the code provides a major opportunity to “consistently define and provide data on charges and transaction costs.

“The asset management industry is fully committed to transparency and recognises the need to provide clear disclosure of both charges and the transactions costs incurred as part of the investment process.”