Ukrainian asset management companies considering compliance with GIPS
On October 25, 2017 a workshop was held in Kyiv supported by CFA Institute, where Ukrainian asset management companies discussed the benefits of being compliant with the Global Investment Performance Standards (GIPS).
GIPS are the ethical standards that guide investment managers presenting their performance results. GIPS standards provide a true and complete disclosure of the performance results of asset managers. GIPS was developed by the CFA Institute (USA) and today they are widely used by investment funds around the world. According to CFA Institute, 74% of Top 100 global asset management firms claim GIPS compliance. Those firms represent 60% (more than $46 trillion) of the world’s assets under management.
"Today an important workshop was held, which purpose was the implementation of the GIPS standards by asset management companies. Given the pension reform in Ukraine, this issue is becoming very important for a wide audience," said Grigoriy Ovcharenko, Director, Head of the local assets management department, ICU, Board Member of UAIB.
Today in Ukraine, as it used to be in many countries, there is no universal methodology for presenting the performance results of asset managers. The companies use their own methods of presenting results, which makes it impossible to assess objectively the effectiveness of such management by both investors of these companies, and the regulator and the asset managers themselves.
"'GIPS is about presentation of results, not calculating. Presentation of results should be complete, unbiased, true and selfexplanatory. It does not sound complicated, but in fact, companies have to correct their way of thinking in be compliant with GIPS," explained Laurent Fedrigo, partner, Deloitte Luxemburg.
"For 30 years GIPS is the world's most widely accepted reporting standards for funds. The GIPS standards not only ensure fair representation and full disclosure of firms’ investment returns as expressed through consistent past performance information, but they also communicate firms’ belief in self-regulation according to the ethical best practices supporting the calculation and presentation of investment performance. Now that Ukraine is going through economic reforms, it is the best time for asset managers to implement these standards," assured Ian McAra, Director of Global Investment Standards for the EMEA Region, CFA Institute.
"CFA Institute and the Ukrainian Association of Investment Professionals CFA Society Ukraine calls on Ukrainian asset managers to become compliant with GIPS. This will increase trust of investors and will contribute to the development of this segment of the financial market, especially in the context of the future introduction of the 2nd level of the pension system in Ukraine," said Olga Burenko, CFA, Board Member, Head of Industry Relationship & Sponsorship Committee, CFA Society Ukraine.
The workshop was organized by the Ukrainian Association of Investment Professionals CFA Society Ukraine, supported by the international CFA Institute and the Ukrainian Association of Investment Business (UAIB). The participants of this workshop were representatives of Ukrainian asset management companies, the National Commission for Securities and Stock Market, the Ukrainian Association of Investment Business (UAIB), members of the CFA Society Ukraine and representatives of the CFA Institute.