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ARCHIVE
IDC Paper Assists Boards in Oversight of ETFs
By Annette Capretta
October 19, 2012
The Independent Directors Council (IDC) has issued a new paper, Board Oversight of Exchange-Traded Funds in order to assist directors of exchange-traded funds (ETFs) in performing their oversight responsibilities. The demand for ETFs has grown markedly as investors—both institutional and retail—increasingly turn to ETFs as investment options in their portfolios. With the increase in demand, sponsors have offered more ETFs with a greater variety of investment objectives. Our paper also may be useful for directors who do not currently oversee ETFs but wish to be more familiar with a board’s oversight role, including those whose fund groups may currently invest in ETFs or intend to launch ETFs in the future.
As we point out, ETF directors—like all fund directors—have a fiduciary duty to the fund and serve to protect the interests of fund shareholders. An ETF director’s responsibilities are substantially similar to those of mutual fund directors, although there are some differences and different areas of focus. For example, directors will want to understand the creation and redemption process for ETFs, the trading of ETF shares on the secondary market, and how well processes are working for the benefit of ETF investors.
More information: ICI’s Resources on Exchange-Traded Funds.
Annette Capretta is deputy managing director of IDC.
TOPICS: Fund GovernanceExchange-Traded Funds
Yes, Your Fund’s Board Is Watching Out for You
Amy Lancellotta
June 12, 2012
A recent Wall Street Journal headline posed the question, “Is Your Fund’s Board Watching Out for You?” (June 10, 2012).
TOPICS: Fund Governance
MarketWatch Misunderstands Important Role of Mutual Fund Directors
By Amy Lancellotta
May 15, 2012
Shareholders deserve better than a recent MarketWatch column’s clear misunderstanding of a mutual fund director’s work. To correct just a few points:
TOPICS: Fund Governance
Independent Directors and Trustees Deeply Concerned About More Changes to Money Market Funds
By Amy Lancellotta
May 9, 2012
As the SEC continues to consider flawed proposals that would have far-reaching consequences for money market funds, two groups representing mutual fund independent directors and trustees released a joint statement registering their deep concerns about any further changes to the regulation of these funds.
TOPICS: Fund GovernanceMoney Market Funds
Funds' Board Structures Promote Efficiencies and Cost Savings for Shareholders
By Amy Lancellotta
December 5, 2011
Reporters, academics, and others who are unfamiliar with investment companies sometimes question the unusual structure of fund boards. Unlike operating companies—where each company as a rule is overseen by its own board—multiple funds in a complex typically share common boards. In Overview of Fund Governance Practices, 1994-2010, we found that 83 percent of fund complexes use a “unitary board” (one board for all their funds), while 17 percent use “cluster boards” (two or more boards, each overseeing a group of funds within the complex).
TOPICS: Fund Governance
ICI and IDC Oppose SEC’s One-Size-Fits-All Approach to Proxy Access
By ICI Viewpoints
December 8, 2010
TOPICS: Fund Governance
SEC Considerably Understates Costs of Rule 12b-1 Reform Proposal
By ICI Viewpoints
December 1, 2010
Following up on our November comment letter to the Securities Exchange Commission, ICI conducted and submitted our own cost-benefit analysis of the SEC’s proposal to replace Rule 12b-1.
TOPICS: Fund GovernanceFund Regulation
ICI Research Shows How Funds Have Addressed Changing Mix of Proxy Proposals
By ICI Viewpoints
November 10, 2010
New ICI research on trends in proxy voting by mutual funds finds that the 2007–2009 financial crisis altered the mix of proxy proposals funds voted on. Our economists’ examined more than 10 million fund votes cast during this period.
TOPICS: Fund Governance
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