CFA Institute has added Eastspring Investments (Singapore) and Fullerton Fund Management Company to a growing roster of investment firms around the world that voluntarily comply to the CFA Institute Asset Manager Code of Professional Conduct (AMC).

 

The AMC outlines the ethical and professional responsibilities of firms that manage assets on behalf of clients.

 

“We are entering a new era in the asset management industry here in Asia as investment funds move cross-border.  Measures such as the Asia Region Funds Passport and Asean Collective Investment Schemes Framework will provide investors with a far more diverse range of investment products, many of them from markets and firms that investors may not be familiar with. The differences in levels and standards of conduct, practice, and governance of different markets pose significant challenges to investors, both at the retail and institutional levels. Imagine the huge improvements in trust and comfort  for investors if all firms, regardless of their domicile, adopt a global standard of care, culture, due diligence that places investors’ interests at the core essence of their operations,” says Aaron Low, chair of the board of governors of CFA Institute.

 

He notes that research findings on most investors generally under-diversifying their non-domestic allocations have been normally attributed to lack of information on foreign markets.

 

“At the heart of this anomaly is more likely to be a lack of understanding and trust in anything that is foreign. So it is now more important than ever for investors to have a common basis on which to compare investment firms across these markets. The AMC is a set of universal standards that offers such a basis. By voluntarily complying with the AMC, investment firms demonstrate to investors their commitment to uphold high standards of ethics and professional conduct and be good stewards of clients’ assets.”

 

The Code is based on six pillars: namely, that managers must act in a professional and ethical manner at all times; act for the benefit of clients; act with independence and objectivity; act with skill, competence, and diligence; communicate with clients in a timely and accurate manner; and uphold the applicable rules governing capital markets.

 

 

For investors and asset owners, including pension funds that hire asset management firms to manage part of their portfolio, the AMC helps them quickly identify firms that commit to a common standard of ethical principles and sound professional practices. For asset managers, AMC compliance demonstrates the value they put on safeguarding clients’ interests.

 

Jackie Chew, chief executive officer of Eastspring Investments Singapore, says, “Adopting the AMC is just one of many ways we demonstrate to our clients our commitment to fiduciary responsibility and helps us stand out in this competitive market.”

 

Manraj Sekhon, chief executive and chief investment officer of Fullerton Fund Management, says, "At Fullerton, we understand the importance of ethical behaviour in our industry and have always placed a strong emphasis on self-regulation. Our compliance to the AMC helps ensure alignment between our own internal values and the professional standards that are recognized globally. This gives clients greater confidence in Fullerton, which is especially important as we continue to broaden our presence in new markets."

 

The addition of Eastspring and Fullerton brings to eight the total number of firms in Singapore that claim compliance to the AMC. The other six are: Hayate Partners; IDFC Capital (Singapore); Lumen Advisors; SilkRoad Property Partners; SLF Strategic Advisers and Valeur.

 

Globally, more than 1,050 firms voluntarily comply with the code.