The Financial Conduct Authority’s ( FCA) latest package of measures aimed at boosting the UK’s investment culture has drawn a largely positive response from across the industry.
EY UK and Ireland financial services leader Martina Keane described the FCA’s investment package as both “welcome and timely.” She said the announcement aligns with the Chancellor’s goal to spur consumer and business investment, and that simplifying retail disclosures, drawing clearer boundaries for professional investors and enabling firms to provide targeted support could shift the UK’s investment culture.
Keane pointed to EY’s recent Attractiveness Survey, which has shown the UK to be still leading Europe in financial services investment but facing intense competition.
Barry Cook, interim proposition director at Quilter, welcomed the FCA’s “policy blitz” to boost the UK’s investment culture, saying the reforms should bring benefits by moving away from “lengthy, jargon-heavy” disclosures and allowing clearer, more engaging product summaries. He also highlighted the importance of recognising different protections for professional and ultra-high-net-worth clients, noting that widening access to private markets will only work if regulation reflects investors’ capacity for risk. Too many people remain overly cautious or stuck in cash, he added, leaving “wealth creation on the table.”
The FCA was right to examine the rapid growth of model portfolio services, which have almost doubled to £190bn in three years, said Quilter investment director lead Andy Miller. Although retail clients see MPS and fund-of-funds as similar, he noted that the regulatory processes behind them differ significantly. Aligning the regimes, he said, would make comparisons clearer and raise standards without stifling growth. “It is important that the growth of MPS is not stifled and consumers know what it is they are investing in. Not all MPSs are created equally, so better comparison between them, and fund of funds, will ultimately lead to better customer outcomes,” said Miller.
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As part of the reforms, the FCA also set out plans to introduce its new Consumer Composite Investments (CCI) guidance to manage how retail disclosures are designed and understood. Broadridge, which contributed to the regulator’s CCI workshops, noted that its readability analysis of Ucits Key Investor Information Documents from the UK’s largest asset managers shows nearly half are written at an academic level.
Stephen Johnston, head of fund communications solutions at Broadridge, said the proposals represent “an important step toward smarter retail disclosures,” adding that while greater flexibility will require firms to make more considered, defensible decisions, it should ultimately lead to more comprehensible, engaging and informative materials for investors.
