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Grim Highlights 2015, 2016 Initiatives

In a recent speech, Director of the Division of Investment Management David Grim highlighted the initiatives undertaken by the Division in 2015 and discussed initiatives for 2016. Grim noted the Division’s work on recent rule proposals on derivatives use, liquidity risk management programs, and reporting enhancements. Grim called the current data collection process “outdated” and noted that prior to this year’s proposals, the Commission’s guidance on derivatives was issued in 1979 and the guidance on liquidity management was issued in 1992.

Looking forward, Grim noted that “[a]ddressing risks in the asset management industry was a main focus in 2015 and will continue to be in 2016.” Planned initiatives include a recommendation to require transition planning at investment advisers covering major disruptions, and a recommendation to require stress testing by large investment advisers and investment companies required by the Dodd-Frank Act. Additionally, Grim said that the Division is working with staff across the Commission to develop a uniform fiduciary standard recommendation and a recommendation for third-party compliance reviews. Grim also highlighted non-rulemaking initiatives, such as a staff initiative “to evaluate staff comments on the disclosures it reviews” with an eye towards consistency, effectiveness, and providing guidance to registrants, and the formation of an emerging risk committee of staff across offices in the Division of Investment Management “in an effort to assess, and internally communicate, potential emerging risks.”