Fund governance is one of the most important functions we perform on behalf of investors.
Aegon’s Fund Governance Group
Our Fund Governance Group is independent of our fund management functions and stands in the customer’s place with the aim of ensuring the funds we offer are appropriate for your clients and perform as expected.
Aegon's Fund Governance Group has ultimate responsibility for ensuring that we meet our Funds Promise commitments to your clients:
- We aim to offer high quality funds which meet their objectives.
- We monitor funds to check if they perform as expected.
- We take action if funds don't meet expectations.
- We give you the facts you need to make decisions.
How our governance process works
The Fund Governance Group is responsible for governing funds built and managed by Aegon, like the Risk-Managed Portfolios. To do this it focusses on four key areas:
The Fund Governance Group ratifies the mandate of any new Aegon fund to make sure it can be managed in line with expectations and is likely to deliver good customer outcomes. It ensures compliance with MiFID II and PROD principles regarding target market, suitability and transparency of reporting.
The Fund Governance Group uses a framework to deliver on our promises to customers and provide assurance to our stakeholders. To achieve this, the team operates a number of processes and controls which identify where funds are not being invested as customers have been led to expect and then highlights funds that are not delivering good customer outcomes. The Fund Governance Group uses a risk-based approach, taking account of Aegon's strategic objectives as well as the requirements of our key stakeholders:
- regulators, and
Our funds are generally designed to be held for five years or more, so our governance focuses on long-term expectations. However, if a fund or fund range persistently fails to meet the criteria above, and we believe these reasons are systemic, the Fund Governance Group will recommend changes.
Changes to funds or managers can be made for a variety of reasons, not just performance. However, our guiding principle is to ensure that such changes help us meet our Funds Promise commitments to investors.
Where monitoring suggests changes to solutions we've created - such as the Risk-Managed Portfolios - would improve customer outcomes, the Fund Governance Group may recommend changes. Amongst other things, this could mean updating the asset mix or making changes to the funds that make up that portfolio.
The Fund Governance Group will also assess the materiality of any changes, and whether communications are required to advisers and their clients.
This may mean communicating directly with all those affected, or for smaller changes we may post updates on our website instead.
There's no guarantee the funds will meet their objectives. The value of investments can fall as well as rise and investors may get back less than they invest. Aegon's Funds Promise applies to the Risk-Managed Portfolios only.
Some firms prefer the simplicity of using ready-made investment portfolios, governed and managed by experts. So, at the heart of our investment offering, we have a range of six Risk-Managed Portfolios designed to suit different client risk preferences.