iShares supports RDR proposals

iShares, the Exchange Traded Fund (ETF) provider, has given its full support to the FSA's Retail Distribution Review Proposals, as it seeks to establish a new level of consumer trust and confidence by distinguishing between independent advice and sales advice to create better clarity for consumers.

Commenting on the RDR proposals, Rory Tobin, CEO iShares Europe, said: "We agree with the FSA that the end consumer should have transparency on the breakdown of costs between product and advice. We welcome the removal of any commission bias that may exist in the current UK distribution model of investment products. We also believe in the value advisers add to their end clients and that their business models can continue to be profitable and sustainable in the new regulatory environment."

"We have seen a similar step change in the US as the advisory market has moved to a largely fee based, fiduciary advice model providing investors with greater confidence, transparency and trust. In the UK, iShares are favoured portfolio building blocks offering full transparency for many fee based intermediaries, including private banks, private client managers and independent financial advisers. However, because iShares has never offered commissions or rebates, our investment products and solutions have been significantly underrepresented in the current UK financial advice market. We believe that iShares products and solutions are well suited to a high percentage of retail investors."

"It will take time for the industry to adapt to these new proposals. However, there are already signs of change as we see growth in sales of ETFs distributed through advisers that do not receive commission. iShares has always successfully aligned itself with fee based advisers and will continue to work with the UK intermediary community to promote ETFs as a core investment option within a fee based advice environment."