Developed in consultation with the Central Bank of Ireland, the code will provide a set of principles and guidance which the IFIA said “codifies existing good practice and presents suggestions based on codes introduced in other jurisdictions”.
The IFIA said, central to the new code is the introduction of an independent director to the board of each service provider. In addition, the framework also suggests that no individual shall have unfettered decision-making powers.
The code also ensures a clear set of responsibilities for the board, including oversight, risk and compliance. The boards are also responsible for key appointments, and the prevention of any conflicts of interest.
While the IFIA said the code will be of benefit to all funds service providers, it is to be introduced on a “comply or explain basis”, which allows fund service providers a degree of flexibility as to how they meet the requirements included in the code. For those providers choosing to adhere to the code, the IFIA has recommended a transitional period of 12 months.
IFIA chief Executive Pat Lardner said: “In today’s environment there has been an added emphasis on good corporate governance, and we believe the code will build on this idea and on the sound practices that already exist in Ireland.
“The code will allow all fund service providers to ensure they have best practice in place. The changes necessary to adhere to the framework will differ from firm to firm, which is why the code is being introduced on a voluntary, comply or explain, basis.”
