Just days after its Fund Management Company Guidance (Guidance) took full effect on 1 July 2018, the Central Bank has already signalled its intention to ensure that its provisions are fully implemented and complied with.
In the latest edition of its Markets Update (published 5 July 2018), the Central Bank has issued a notice to fund management companies (which includes self managed investment funds), advising them that from 1 July 2018 the Central Bank will be assessing how they have implemented and embedded the requirements of the Guidance within their organisations.
The Central Bank will be considering the appropriateness of firms' resources and organisational structures, with the work carried out by the organisational effectiveness director being of key relevance. All fund management companies must now have this organisational effectiveness role in place and the requirements are set out in Part II of the Guidance. The role requires an independent director to keep the fund management company's organisational effectiveness, including the appropriateness of resources and board composition, under review, and to regularly submit reports to the board for discussion and decision making.
Through supervisory engagement with relevant firms, the Bank will evaluate this work, placing a particular emphasis on whether the board of the particular fund management company has implemented any proposals to improve its organisational effectiveness.
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.