PIMFA Comments on Woodford Suspension and the Implications on the Financial Services Sector
Monday 17th June 2019
PIMFA, the trade association for investment managers and financial advisers, has commented on the news that dealing in the units of the LF Woodford Equity Income Fund has been suspended.
Liz Field, CEO of PIMFA said:
“As details unfold about Woodford, the key implication for our sector, which encompasses the personal investment management and financial advice firms that are fundamental to individuals’ requirements to build their own personal financial futures, is ultimately an erosion of trust.
Trust is at the core of the adviser/personal investor relationship. Since the decline of Defined Benefit pensions and the advent of pension freedoms, which enable choice, individuals have needed guidance and advice to help inform that choice. In the absence of financial education explaining the myriad of investment vehicles and what they are used for, people rely on advisers and personal investment managers to help them. There is an assumption in this that the right governance is in place. Those within the sector are aware of the focus on governance since the financial crisis, and of the Retail Distribution Review designed to enhance the financial advice and personal investment management profession. Regulation, written predominantly by a UK-held pen in the EU, produced MIFID II with a focus on investor protection and transparency. For the good of investors, after the deluge of rulemaking over the last few years we do not need further regulation, we need effective implementation of the rules we have.
At a round table this week, sector representatives discussed how to increase personal investment in the markets. This is vital for the wealth and wellbeing of individuals and families. But statistics, such as those showing the proportions of private money invested in cash ISAs vs equity ISAs, show there is a long way to go in getting personal investment to better levels.
Our mission, as determined by our members, has as its cornerstone the need to drive outcomes that increase trust and confidence in the sector. Up and down the country at meetings with my member firms, we discuss the implementation of good practices with the private investor in mind.
Actions which undermine good practice serve only to tarnish the reputation of the sector and undermine trust. This acts as a block to the very investment that is important to individuals and families in providing for their future and underpinning their wellbeing, and to jobs and growth in the economy as a whole.”
Notes for Editors
About PIMFA – the Personal Investment Management & Financial Advice Association
- PIMFA is the leading trade association for firms that provide investment management and financial advice to everyone from individuals and families to charities, pension funds, trusts and companies.
- PIMFA represents both full and associate member firms. Full members provide a range of financial solutions including financial advice, portfolio management, as well as investment and execution services. They assist everyone from individuals and families, to charities and pension funds, all the way to trusts and companies. Associate members provide professional services to the PIMFA community.
- PIMFA leads the debate on policy and regulatory recommendations to ensure that the UK remains a global centre of excellence in the wealth management, investment advice and financial planning arena. Our mission is to create an optimal operating environment so that its member firms can focus on delivering the best service to clients, providing responsible stewardship for their long-term savings and investments.
- PIMFA was created in 2017 as the outcome of a merger between the Association of Professional Financial Advisers (APFA) and the Wealth Management Association (WMA) with a history as a trade association going back for 28 years – read more.
- Further information can be found at pimfa.co.uk
- To become a member of PIMFA for access to training, benefits and discounts, please visit https://www.pimfa.co.uk/become-a-member or contact us directly at [email protected]
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