What will be the impact of MiFID II on the investment fund distribution landscape?
The European Union can trace its origins to 1958, and at the time of writing that is 57 years in which a concept has grown to be a reality for over 500 million people.
It has brought many successes and some frustrations in getting such a large group of peoples to live to a broad set of common criteria. Previously steady industries are challenged by new rules, competitors and marketplaces. Fund management has had its fair share of European regulation with successes such as UCITS and other challenges such as AIFMD, which has brought some frustration to the industry. Now the third iteration of MiFID I combined with competitive forces looks set to alter investment fund distribution in the 28 European Union Member States.
Within this context it is perhaps useful, even essential, to pause to reflect not just on the immediate causal impacts of MiFID II on the investment funds industry, but also to consider the wider context. Who buys funds and why? How do they buy them? Are distribution methods efficient and finally are funds themselves fit for purpose when we are talking about something as essential as savings and retirement provision?