With just under nine months remaining until the European elections in June 2024, the Investment Association (IA), the trade body for the UK-based investment management industry, has today published its vision for how investing could work better for individuals, businesses, and the economy, to deliver a more modern, resilient, and sustainable Europe.
Representing 250 investment management firms, who manage €3.2trn on behalf of European clients, the IA’s report, ‘Making Investment Better for All’, calls on the EU institutions to place individuals at the centre of policymaking, improve access to sustainable investment opportunities, promote open and efficient capital markets, support innovation and new technology, and foster greater international cooperation on regulatory standards. Specific recommendations include:
- Making investment more accessible by focusing on making disclosures ‘digital by default’, and more concise, clear, and meaningful.
- Supporting innovation, including the adoption of artificial intelligence, which holds substantial promise for enhancing supervision within financial services, as well as laying the foundation for the tokenisation of funds, which will open new avenues for innovation and investment.
- Tackling the long-term challenges on the adequacy and affordability of pensions by acting now on pension dashboards and possible auto-enrolment programmes.
- Bringing clarity and certainty to investors on sustainable investment opportunities by prioritising the review of the EU’s Sustainable Finance Disclosure Regulations. This will need to consider the sequencing of the EU’s sustainable finance agenda, recognise the complex and unique investor preferences, and provide greater international alignment on standards.
- Prioritising international cooperation to ensure future policy responses relating to non-bank financial institutions (NBFIs) are evidence based and properly calibrated to financial stability risk.
- Conducting a thorough review of the cost of market data to improve access to data and enable more informed investment decisions.
Ensuring cross-border activity through open and efficient capital markets is vital to the economic prospects of Europe and for the ongoing success of the European investment management industry. The EU and UK have long history of cooperation and with both being key markets on the global stage, and strengthening this relationship has the potential to benefit businesses and households across Europe. Therefore, operationalising the EU-UK Joint Forum on financial services should also be a priority, to ensure a forward-focused dialogue between the two markets.
Chris Cummings, Chief Executive of the Investment Association, said:
“Investment managers play a vital role in helping millions of households across every EU member state provide for their financial futures. Our members manage €3.2 trillion for European investors and provide €1 trillion to European businesses and projects in need of capital.
“Today we’ve outlined our vision for how the EU institutions can harness investment and provide concrete solutions to ensure that investment works better for consumers and the economy, delivering a more resilient and sustainable Europe. We stand ready to work with policymakers and regulators across Europe to deliver on this agenda.”