From the Editor...

November 9, 2021

By Hillary Jackson

From the Editor...

 

Are mutual fund boards falling short when it comes to compliance oversight? According to the SEC's latest risk alert, they may very well be. The Commission's Division of Examinations provided feedback to the market recently after conducting exams of more than 50 mutual fund and exchange-traded fund complexes—part of its previously announced "RIC Initiatives" effort—highlighting issues it found with funds, advisers, and boards. The message? Some fund governance pros were surprised by the SEC's findings, but overall, here's the takeaway: "Here are the examination priorities that we're concerned about, and thus you should be concerned about," according to one industry lawyer.

 

Looking elsewhere at board practices, we delved recently into the self-assessment process. Recent data shows that fund boards generally assess their own performance on a board level rather than looking at individual directors, which is a more common practice on corporate boards. There are reasons for this, and there are ways to still assess individual directors' performance—and deal with it, when necessary—through the board-level exercise, according to fund governance professionals with whom we spoke. 

 

We also recently exclusively interviewed a couple of independent board chairs, allowing us to provide a look inside the boardrooms over which they preside. Chairman Bill Thomas from abrdn ETFs Trust talked us through the reasoning behind that board's recent hire—a well-known, recently retired industry lawyer from Willkie Farr & Gallagher's Asset Management Department. And RBB Fund Chair Arnie Reichman gave us insight into his thinking as the series trust board ages and spurs succession planning. Having just hired its first female director, the RBB Fund board is keeping diversity & inclusion front of mind.

 

Finally, we looked at lessons learned over the seemingly never-quite-ending pandemic in our latest 10 Things list. Have a look, and let us know if you've got an idea for a future list. 

 

For now,

 

Hillary Jackson, founding editor

 

 

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