two half-days with case studies – for product governance, risk managers and compliance staff
Introduction
Defining product governance
Finding the key materials
MiFID 2, Arts. 9 & 10 MiFID Delegated Directive
Insurance Distribution Directive, article 25, POG Regulation, articles 3-9,
ESMA, EBA & EIOPA Guidelines
National rules
EU powers to issue product intervention rules and intervene generally
The product governance arrangements & structures
Building the product governance arrangements
Who must be there doing what?
Doing the product governance work
Role of senior management and compliance
Basic risk management for products
Reviewing the procedures
Different forms of product reviews and ongoing monitoring
The tasks
Identifying the target market – positive and negative
Working with distributors and others on target markets – research, focus groups
Different roles of providers and distributors
Core design issues
Building a specification
Modelling – value measures
Drafting the terms and conditions
Common fund and wrapper issues – investment content, charges
Ensuring that service infrastructure is in place – outsourcing
Product or Stress testing
Purpose
Method – what is there to test against?
Resilience – technologically, financially and other elements
Testing governance
Distribution channels
Selection – internal and external, technologically diverse, advised or execution-only
Monitoring distributor behaviour
Working with distributors and affiliate marketers
Changing or blocking distribution channels
Distributor Responsibilities
Know your product
Assess compatibility of product with customers
Obligation to obtain material from manufacturers
Handling distribution chains
Information sharing with manufacturers
Sales outside target market
Product material
Clear, fair and not misleading
ESMA measures on contracts for differences
Material for distributors
Post-launch and ongoing review
MI on customer types and distribution sources – lapses, complaints and claims
Researching the product and how it is being used
Distributors’ role in amending target markets
Managing failures – communication, withdrawal and compensation