From the Editor...
It's not often that a mutual fund lawyer can boast that he's advised the same board client for four decades, but Paul Dykstra can do just that. Ropes & Gray's Dykstra attended his last board meeting with 40-year client Prudential Retail Funds board in the fourth quarter and retired at the end of the year. His partner for the past 20 or so years, Paulita Pike, and others—including the man himself—reflect on Dykstra's long career and how board responsibilities have changed in that time.
One recent change came as a bit of a surprise. For more than a decade, the mutual fund industry—and fund boards in particular—have been skeptical and critical of Morningstar's Stewardship Grades, which assigned letter grades to fund families based on a series of "key intangibles." The Chicago research firm tweaked its methodology a few times since the 2004 debut of the Stewardship Grades, but stood firmly by their validity...until now. Morningstar as given up assigning grades to fund families and is instead concentrating on providing Parent Pillar Ratings to fund advisers. Fund board quality is no longer a factor, and Morningstar's surprising about face is, largely, being welcomed by directors.
In the legal realm, an excessive fees case against Prudential Investments has been dropped by the plaintiffs and closing arguments took place in a similar case against Hartford Financial Investment Services. And in boardroom news, the boards of Janus Funds and Henderson Funds seem to have worked out what the post-merger board will look like.
Please check out our Added Perspective section, where you'll find previously published content that may be of interest. The most recent addition there is a piece by Amy R. Doberman from Wilmer Cutler Pickering Hale & Dorr, LLP on why a separate board for exchange-traded funds might be the way to go.
Looking ahead to next month, we'll be attending the ICI Mutual Funds and Investment Management Conference in Palm Desert, Calif. Hope to see you there!
Hillary Jackson, founding editor, Fund Board Views