Industry Bodies collaborate to inform the retirement sector of critical implications of FSCA communi
The Institute of Retirement Funds Africa is supporting Baseta: Council of Retirement Funds for South Africa in an industry event to discuss this communication and the impact this provision of Directive 8 will have on the retirement sector. The event will be held on 13 February 2020 from 09h00 to 12h30 in Johannesburg.
Please take note that the venue for the above mentioned seminar has been moved from our offices to Protea Hotel,Marriott Midrand,14th Rd,Noordwyk, Midrand due to an increased number of delegates.
Registration and refreshments starts at 09:00 am and the session will run from 09:30 am to 12:30 pm.
NB:Those who are not able to atttend the seminar,are welcome to join us LIVE on our Facebook page: https://www.facebook.com/Batseta/
The purpose of the communication, issued by the Financial Services Conduct Authority (“the Authority”) on 12 December 2019 has been to inform the industry and stakeholders about the Authority’s approach to addressing the existing conflict of interest relating to principal officers appointed by boards of funds while also being employed by service providers of the fund. (FSCA COMMUNICATION 7 OF 2019 (PFA) dealing with Directive PF No. 8 of 2018: Prohibition on the Acceptance of Gratification - The role and independence of the Principal Officer.)
The issue was set out in paragraph 3.8.4. of Guidance Notice 2 of 2018 published on 27 June 2018. The Authority is of the view that the simultaneous employment of the principal officer by a service provider is impermissible and undesirable. The Authority is further of the view that principal officer’s ability to comply with his/her duty to report on the activities of such service provider is likely to be impaired by virtue of their employment relationship with the service provider.
The Pension Funds Act requires that every fund has a principal executive officer (“principal officer”). The principal officer has a legal duty to protect members of the fund by reporting to the Authority any matter that may prejudice the members of the fund. Such duty involves reporting the conduct of the board members and service providers where they act in a manner that prejudices the members of the fund.
Directive PF No. 8 issued in 2018 provides that principal officers are not permitted to accept any gratification which objectively viewed creates a conflict of interest with their fiduciary duty towards the fund in which they serve. Gratification is defined in Directive PF No. 8 as including “any office, status, honour, employment, contract of employment or services, any agreement to give employment or render services in any capacity...”
Interested partied can register for the event using the following link:
Ends For further information contact Institute of Retirement Funds on (011) 450-1670 or Batseta on (011) 805 6340