IFIC campaign encourages investors to open their statements

The Canadian Securities Administrators (CSA) on Monday announced the launch of new multi-year research project to measure the impact of phase 2 of the Client Relationship Model (CRM2) and the point of sale (POS) amendments, which were fully implemented this year.

“The research will measure outcomes related to investor knowledge, attitude, and behaviour, registrant practices, and fund fees and product offerings,” the CSA says in a statement.

However, it will be several years before the regulators have the results of that research in hand. The project isn’t slated to be completed until 2021, based on data collected from 2016 to 2019.

The prolonged study period, “will allow us to secure helpful longitudinal information over a multi-year period post implementation to assess the impacts of CRM2 and POS,” the CSA adds.

The final tranche of CRM2 reforms took effect in July, and it’s expected that most investors will start receiving new annual reports that detail the costs of investing, along with enhanced portfolio performance reporting in early 2017. The requirement for pre-sale delivery of Fund Facts disclosure came into effect in May of this year.

“CRM2 and POS were designed with investors’ needs in mind,” says Louis Morisset, chairman of the CSA and president and CEO of the Autorité des marchés financiers (AMF), in a statement. “We want to ensure that the increased transparency about investment costs and performance and the provision of the Fund Facts documents are indeed helping investors make more informed investment decisions.”

Opponents of further reforms to retail investment regulation, such as a ban on embedded commissions and the introduction of a best interest standard, have long argued that the effects of these recent efforts to boost transparency must be evaluated before regulators can decide whether more substantive changes are needed.

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