From the Editor...
Just as the market is trying to absorb and respond to the Securities and Exchange Commission's proposal on liquidity risk management, it is facing the inevitability of the Federal Reserve raising the benchmark federal funds rate after keeping it near zero for the seven years since the financial crisis. Both of these events give mutual funds boards a lot to think about and plan for, and we've put together a new "10 Things" list—what directors should consider ahead of federal funds rate increase—to help with the task. These lists are meant to provide directors with conversation starting points, and we hope they're useful as you tackle the array of subjects on your agendas. Please feel free to reach out with ideas for future "10 Things" lists.
Many of the conversations fund directors have are with the funds' chief compliance officer, and we've gotten some perspective from the market on the SEC's recent risk alert regarding outsourced CCOs. Could this alert be a precursor to enforcement actions, as others have been in the past? We'll have to wait and see, of course, but the subject is worth thinking about and discussing nonetheless.
Part of our goal here at Fund Board Views is to provide independent fund directors with insight into what their colleagues on other boards are dealing with and how they're handling the many challenges that come along with serving on a mutual fund board. We accomplish that, in part, by speaking with directors themselves and sharing their perspectives with you, our readers. How did the boards of Goldman Sachs Asset Management and John Hancock Investments deal with the introduction of new products? How has the Victory Funds board handled the change in ownership at the adviser, and what has Neuberger Berman done to keep up with the adviser's expansion in the liquid alts space? And most importantly, how can other boards learn from these experiences? Take "A Seat at the Table" and find out.
Another way we're trying to keep you informed is our resource section "Added Perspective." Here, we post links to research, white papers, academic and law firm work, and surveys that you may find interesting and pertinent to your role as a fund director. These posts are sourced elsewhere and archived on our site, and we hope you'll refer back to them as needed in the future.
As for us here at FBV, we're watching the SEC for its long-awaited release on funds' use of derivatives (which we hear is due any day now) and looking forward to the Thanksgiving holiday (a lot to be grateful for this year). Keep reading, and get in touch—we'd love to hear from you!
Hillary Jackson, founding editor, Fund Board Views