Monday, November 06, 2017 8:48AM /KingsThrones
Source: CFA Institute.
Tailwinds in Local Money Management, as Nigeria Embraces the GIPS® Standards
The Global Investment Performance Standards – GIPS standards, are a set of global industry minimum requirements and recommendations for calculating and reporting investment performance. When voluntarily and fully complied with, investment managers’ performances are ascertained as plausible and fairly comparable across all regions.
With widely acknowledged potentials for promoting quick and seamless access to markets around the world, the ideals behind countries’ adoption of the standards today already transcend rote operational guidelines in the global investment management industry. In principle therefore, the standards are here to promote the fair representation, and full disclosures of facts behind every performance presentation, especially to prospective investors.
They basically fulfil an essential role in investment management around the world, meeting the need for globally accepted standards for investment management firms in calculating and presenting their results to potential clients. Potential and existing clients are assured that the information shown in a GIPS - compliant performance presentation reflects the results of the presenting firm’s past investment decisions – which is equally crucial in the investor’s final decision-making process.
Investors are also assured that the returns are calculated and presented on a consistent basis and that they are objectively comparable for a given strategy to those reported by other firms claiming compliance with the standards.
Since their introduction in 1999, the GIPS standards have gathered momentum with investment management firms worldwide adopting these voluntary and ethical requirements for calculating and presenting historical investment performance. By the operations of both the GIPS Council (the larger, global representative body) and the Executive Committee (the operating entity), strong partnerships are formed with country sponsors to promote and educate the GIPS standards, and these have greatly contributed to their rapid global reach.
With the endorsement of its country sponsor of the standards in August, 2017, Kazakhstan became the 41st and most recent country to join the growing list of countries embracing these ethical standards, Nigeria and Denmark’s own Country Sponsors having been endorsed as the 30th and 31st respectively, on the 26th of May, 2015.
Come Tuesday the 21st of November 2017 however, under the auspices of the Nigerian Country Sponsor comprising of the Fund Managers Association of Nigeria – FMAN, Pensions Operators Association of Nigeria – PenOp, The CFA Society Nigeria, and the capital Market and Pension Industry Regulators, key stakeholders in the Nigerian investment management industry will be assembling in Lagos for an event hosted by one of theirs, Messrs.
KingsThrones Limited, an investment advisory firm, as the very first of its kind in a series of deliberations to entrench a market approach to the adoption of the standards. The first Nigeria Investment Performance Stakeholders Conference is therefore seeking to advance the works of the country sponsor with a view to providing appropriate public information and guidance around the standards’ ideals whilst ideating the framework for its market operations going forward.
The essentials of this gathering rest on the need first and foremost to sensitize ALL stakeholders in the market, starting with investors, to their advisers, investment managers, pension funds, insurers, mutual funds, trade groups, regulators, consultants, and a host of others, of the workings and benefits of these standards, and the general expectations in the adoption process by investment management firms.
One of the significant medium to long term expectations of this new direction is the bolstering of funds flows into the Nigerian mutual and other pooled/broadly distributed investment funds segment, starting with the improved performance reporting modalities for the easy ascertainment and comparative analysis of factual historical records and reliable forecasting.
All stakeholders already identified and more, therefore have the opportunity to interact and debate on these expectations at the one-day session as a starting point, with the primary objective to establishing a clear understanding of the roles and responsibilities of market operators in the journey to attaining compliance with the one and by far most significant global investment performance reporting standards.
The conference attendance is strictly by registration and programme starts promptly by 08:00hrs. Interested stakeholders are hereby advised to register online at http://kingsthronesng.com/popup/reg_form/ for this unique event already headlined by the expected keynote address from the DG/CEO of The SEC himself, Malam Mounir H. Gwarzo.