The Securities and Exchange Commission is launching a high-profile asset management advisory committee comprising both industry and association executives, regulators and academics, the agency announced late Wednesday.
The first-time committee, which includes executives from Fidelity and T. Rowe Price, as well as Mark Tibergien, the well-known architect of Advisor Solutions at BNY Mellon | Pershing, is slated to take up a wide-ranging agenda with emphasis on how regulations and industry trends impact retail and smaller investors.
"Asset management is a critical component of our markets and is especially important to Main Street investors,” SEC Chairman Jay Clayton said in a statement.
"This committee will help the commission ensure that our regulatory approach to asset management meets the needs of retail investors and market participants at a time when the industry is evolving rapidly,” Clayton added.
Dalia Blass, director of the SEC's investment management division, said she was concerned "what it will mean for investors—particularly Main Street investors—if the variety and choice offered by small and midsized asset managers becomes lost in a wave of consolidation and fee compression,” in remarks at an Investment Company Institute (ICI) conference earlier this year.
Edward Bernard, senior adviser to T. Rowe Price, was appointed by Clayton as the first chairman of the committee.
“The SEC put together a terrific group of people, a number of whom are IAA (Investment Adviser Association) members and a few smaller advisors in the mix of firms who are represented on the committee,” said IAA president and CEO Karen Barr to Financial Advisor magazine.
“We are also pleased that the SEC included academic Russ Wermers,” Barr said. Wermers, a professor of finance and the director of the Center for Financial Policy at the Robert H. Smith School of Business at the University of Maryland, conducted the research on a recent IAA paper. It found that the benefits to investors, capital markets and the economy of active management exceed the average “alpha” measurement active managers use.
“We look forward to working with the committee and are hopeful members will address the issue of active versus passive management in both policy and education,” Barr said. “We would hope that the committee would look to ensuring that investors have the full range of options available to them and that policy makers don’t put their finger on the scale regarding active versus passive investments.”
Other members of the SEC committee include: