One voice for the life and investment industry
In an exclusive interview with FAnews, the new Association for Savings and Investment South Africa (ASISA) shared its vision and the impact it will have on the industry.
Creating a truly formidable force in the industry is the new Association for Savings and Investment South Africa, representing the majority of South Africa's asset managers, collective investment schemes, linked investment service providers, multi-managers, and life insurance companies. ASISA was formed by members of the Association of Collective Investments (ACI), the Investment Management Association of South Africa (IMASA), the Linked Investment Service Providers Association (LISPA) and the Life Offices' Association (LOA).
Industry initiative
Just over two years ago, the ACI and IMASA started exploring the creation of a new association. Following a fact finding mission in 2006 to investigate the workings of similar integrated trade associations in the UK and Australia, LISPA requested to be included in the process.
A principle document was approved by the boards of the involved associations, and the LOA was subsequently drawn into the process at the request of the heads of several big financial services providers.
The four associations communicated the vision of ASISA to their members, which led to the vote earlier this year in which the vast majority of the members voted in favour of establishing ASISA. Member companies raised their concerns as the process unfolded and it is this feedback that helped shape the structure of the new association."While the four associations, individually, did a sterling job, the time had come to do things differently," says CEO Leon Campher. "Although the industries represented will continue to operate as they have before, being represented by one single association will introduce subtle changes that will be more obvious at a strategic and regulatory level."This will not only be in the interest of the members, but will ultimately also serve the interests of consumers, while creating the single body Government has been looking for to engage with on policy issues."
Campher explains that in order to ensure that the future of the South African savings, investment and insurance industries are driven strategically at the highest level and without any bias, ASISA has adopted an approach of balance and democracy.
Balance
ASISA membership can only be attained at corporate level, not at a subsidiary company level, and members can only be represented on the ASISA Board by their most senior representative. The aim is to ensure that high level strategic thinking shapes the future of the financial services industry, and not product aligned agendas.
Democracy
ASISA applies a one-member-one-vote principle, which introduces a new form of governance into the financial services industry, providing greater protection for consumers. The ASISA founding statement also commits ASISA and its members to the principle that the consumer's best interest will govern all decision making.
Leveling the playing field
The one-member-one-vote principle means that members will not be able to vote per unit trust or life license held. This will some way towards leveling the playing field. For the first time, the big conglomerates will have the same vote as the small independent companies.
As a result, the new association will be taking decisions that will take into consideration the impact on an investor's entire basket of investments, be they unit trusts, life insurance products, or linked investment products.
Mandate
ASISA has been mandated to pro-actively engage with policymakers and the regulator, while at the same time looking after the interests of consumers and ensuring the sustainability of the industries and the intermediaries who promote these industries.The association will promote a culture of savings and investment in South Africa by playing a significant role in the development of the social, economic and regulatory framework in which its members operate, thereby assisting members to serve their customers better.
Structure
The governance structure of ASISA comprises a Board of Directors, with Governance and Board Committees supported by standing committees and working groups. This means that policy and strategy decisions will be taken at a board level, while technical issues will be resolved at committee level.
Sector specific issues
"It is a reality, however, that there will always be issues that will be relevant to one product wrapper, but not another," explains Campher. "Therefore the Risk and Insurance Board Committee, for example, will deal with matters of relevance only to the life industry. Issues relevant to the other former associations are dealt with across the new Board Committees.
"Where there is a product specific issue, it is dealt with as an agenda item within that Board Committee and referred to a specialist working group if needed. The Marketing and Distribution Board Committee, for example, will focus on all distribution and intermediary issues, irrespective of the product wrapper concerned."
"Industry issues that will receive priority attention include retirement fund reform, the dematerialization of money market instruments, and the UCITS III (Undertakings for Collective Investments in Transferable Securities) debate," concludes Campher.
