France's Financial Markets Authority published a SPOT synthesis of thematic supervisory work on governance and the role of senior managers within five portfolio management companies. The review assesses how leaders set and oversee policies and procedures, analyse reporting provided to them, and organise responses to major incidents, while reiterating that managers can face liability where the firm breaches regulatory obligations and that proportionality affects implementation but not the underlying governance requirements. The sample covered independent and group-owned firms managing assets from a few hundred million euros to more than EUR 5bn, all active in listed asset management, with inspections spanning 1 January 2022 to 31 December 2024. Direction and oversight bodies were generally well organised, but some committees did not meet minimum frequency requirements and were weakened by missed meetings or absences; while all effective senior managers received training during the period reviewed, only one firm extended training to members of the oversight function. All firms had policies for investment, risk management, remuneration and asset valuation, but these were not always regularly reviewed or formally approved by governing bodies. Reporting on compliance, internal audit and risk management was usually provided regularly, but one firm did not share information on investment strategies with senior managers and oversight. All firms had internal alert mechanisms for serious incidents, yet some procedures were imprecise or outdated and did not consistently reflect the requirement to inform the authority without delay of serious incidents or events that could compromise licensing conditions. Reported good practices included detailed internal rules for the oversight function, systematic communication of procedure changes to staff with acknowledgements for higher-risk policies, regular presentation by the head of compliance and internal control of key findings to the oversight function, and prior validation by senior managers of reports submitted to the authority; observed poor practices included not defining a minimum meeting frequency for management and lacking a formal channel to escalate key decisions from management committees to senior managers.
France Autorite des marches financiers 2025-10-15
France's Financial Markets Authority publishes SPOT thematic review highlighting governance and incident-reporting gaps at five asset managers
France's Financial Markets Authority released a SPOT synthesis on governance and senior management roles within five portfolio management companies. The review highlighted well-organized oversight bodies but noted issues like missed meetings, inadequate training for oversight members, and outdated incident procedures. Good practices included detailed internal rules and systematic communication of procedure changes, while poor practices involved undefined meeting frequencies and lack of formal escalation channels.