The focus on environmental, social and governance (ESG) as a means of creating sustainable value is on the rise. Institutional investors are increasingly considering nonfinancial performance, such as ESG issues, when making investment decisions. The three factors of ESG and the corresponding investment-related sustainability issues are: Environmental – Is the company environmentally responsible? Does the…

Part 2 of a 3-part series In Part 1 of our Due Diligence Series, Managing Vendor Risks: Implementing an Effective Third-Party Due Diligence Program, we discussed the various aspects of an effective third-party vendor due diligence program. In this article, we focus on the keys to conducting adequate due diligence of sub-advisors to satisfy heightened fiduciary…

The SEC’s Office of Compliance Inspections and Examinations has released its Exam Priorities for 2016. Exam priorities and initiatives launched in 2015 will continue to hold the spotlight in 2016 as new risk-based initiatives address systemic issues. Each regulatory topic can be broken down into the following four categories: (1) protecting the individual investor; (2)…

FINRA shares many of the same 2016 priorities as the SEC with the notable addition of examining firm culture. Each of FINRA’s regulatory priorities can be broken down into the following five categories: (1) protecting the individual investor; (2) protecting the industry from market-wide risks; (3) using data analytics to identify signals of potential illegal…

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