The Investment Association's (IA) chief executive has stepped down after a challenging few days for the trade body.
Wealth Manager understands that Daniel Godfrey took the decision to step down by mutual consent just hours after the IA's board threw their support behind him as chief executive.
His position came into question after key members, such as Schroders and M&G, threatened to leave the trade body. Aberdeen Asset Management, Invesco Perpetual and Fidelity Worldwide Investment were also named as being on the verge of following them out of the door.
None of the fund groups involved would comment on the issue, but privately, senior management at a number of firms have questioned the trade body’s strategy. They suggest the IA’s initiatives were pushing it into territory already covered by the regulator, which was too consumer rather than industry-focused.
Only 25 fund groups signed up to the IA’s 10-point statement of principles and the organisation came under fire earlier this year after it brought out its new fund charges disclosure proposals at a time when firms were getting to grips with the upcoming Mifid II regime.
A managing director of a medium-sized fund management business, who wished to remain anonymous, was even more forthright.
‘I think we have got to a situation where people are disenchanted with their body. Why pay a trade body that people believe is not performing a function?
‘The organisation has no teeth and there is a feeling that it is finding it very difficult to govern. All it can do is to provide guidance and people who are self-interested ignore that guidance, which puts the whole body into disrepute.
He added: ‘They haven’t done a good job of lobbying and they don’t represent the industry’s best interests. They have not covered themselves in glory.’
During 2014 Godfrey saw his pay rise by £58,000 to £533,000, as the trade body saw pre-tax profit increase by 102% to £371,000 in 2014. The trade body's turnover increased by 26% to £9.9 million during the 12-month period, whilst retained profit carried forward totalled £2.1 million, up from £1.8 million in 2013.