CFA Institute has recently sent members an email informing us of the release of a report that contains recommendations for reforming the US regulatory framework that governs its financial markets. The report was done by a group called US Investors’ Working Group, which is composed of the Council of Institutional Investors and the CFA Institute’s Centre for Financial Integrity.
In the same email, CFA Institute says it endorses the report, but, strangely, announces that it is preparing its own position paper on regulatory reform. It is as if CFA Institute wants to look at regulatory reform only partially from the angle of investors. This would not be surprising, since many CFA members are employed by the sell-side, the financial institutions that the proposals aim to regulate. However, as the long term health of even the sell-side industry relies on investors’ regaining their trust in the financial system and its practitioners, I hope the CFA Institute’s own recommendations will not deviate too much from those of the USIWG.
Since the eventual financial regulatory reform will have significant impact on the game books of investment professionals, it is worth taking an interest in it now, and one of the best way to start is to look at the table compiled by CFAI staff that compares the recommendations of USIWG with those put forward by the US Administration (here).