The chance of seeing a more straightforward list of fees for open ended funds could be under threat following fund groups' clash with the Investment Association (IA) over its reform agenda last week.
Difficulties for the trade body started when reports surfaced claiming that major fund houses Schroders and M&G were considering quitting the association and by the end of the week chief executive Daniel Godfrey had stood down.
Commentators claim the news is a setback for fee transparency and progress. Mr Godfrey was encouraging funds to voluntarily submit to higher standards of transparency over fees and to a statement of principles launched in August. Only 25 houses - just one eighth of the total membership - signed up.
Following Mr Godfrey's exit the IA said members had been uncomfortable with its reform agenda and said it would launch a consultation into its relationship with the industry. The body said: "The issues some members have voiced have been about the scope of the Association's agenda and the style and approach of engagement with members in recent years."
But Gina Miller, founder of the True and Fair campaign aimed at transparency in the funds industry, said the measures on the table had not gone far enough. She said: "The statement of principles weren't extravagant by any means. They were what you'd expect from any other sector. Mr Godfrey is being hailed as a bastion of reform but what he was calling for hasn't gone far enough."
The fifth principle in the statement pledged to "explain our fee structures as simply as possible" and "disclose all other costs that could be expected" to affect returns in a simple transparent manner. Ms Miller said: "Mr Godfrey had proposed that all the charge numbers should be available somewhere but there can be up to 11-13 different levels of cost. For example, transaction costs can add up to 50 per cent and then you have things like platforms costs and then custody and admin charges.
"A total cost of investing number should be brought in because publishing lots of different numbers in different places won't help anyone understand."
But the IA said it was in the process of rethinking what issues to tackle. It said: "Nothing has changed our collective commitment to putting customers first and, as part of that, to effective, transparent and competitive delivery to the millions of savers who depend upon the services we provide.
"Whilst our overall remit and focus remains on highlighting the important role that asset managers play in terms of addressing the pensions and savings needs of individuals, supporting the growth of companies and contributing to the UK economy; there is a need to consult on how the Association prioritises against a packed agenda for the industry. The results of this consultation will guide the new CEO, once appointed, and, in the meantime, the management team is focused on business as usual."
Guy Sears, director of risk, compliance and legal, has been appointed as interim chief executive.
