Our stance on embedded compensation has been well documented over the years. At Invesco, we’ve championed investor choice in the debate over mutual fund and dealer fee structures. We believe this is important because not all investors are the same – not all investors need, want or benefit from the same fee structures.
I applaud the Ontario government’s most recent decision to step back from a prescriptive regulatory approach, and allow the marketplace to guide the evolution of advisor compensation. This decision provides advisors and their clients with some respite from an extended period of upheaval and uncertainty. While we are aware of some abuses of deferred sales charges, we are confident that the proposed conflict of interest rules in the Client Focused Reforms will adequately address this issue while allowing principled dealers the leeway to use this tool to serve their clients in the best manner possible.
Last June the Canadian Securities Administrators decided that embedded compensation should remain an option for both investors and advisors. As noted in my blog at the time, we are pleased with this decision. Advisors deserve to be paid for the services they provide on an ongoing basis. For many clients it is the most appropriate compensation model on the market today.
In the end, a market defined by choice and transparency will serve everyone’s best interests and at Invesco, we will continue to remain steadfast in our advocacy.