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UNI Europa Finance (UEF) answered a public stakeholder consultation on “Guidelines on certain aspects of the MiFID compliance function requirements”, issued by the European Securities and Markets Authorities (ESMA). MiFID is the European regulation on markets in Financial Instruments.

For UEF, compliance must by all means consider the key role of employees. For example, compliance must look at the appropriateness of sales objectives, and their potential detrimental effect on investor protection. Employees must not be pressured by conflicting interests of sales targets versus correct advice to customers. That is also why it is of utmost importance that incentive systems are monitored by the compliance department. Compliance should ensure that work is organized in a way which enables employees to respect the rules and should be able to prohibit the sale of products which are too complex even for the sales staff to properly understand. Concerning the function of a compliance officer, he/she has by all means to be independent both from an organizational point of view and from business units.

Participating ESMA’s consultation is all the more important as no employee representative has been accepted to ESMA’s stakeholder group. UNI Europa has been complaining to the European Ombudsman about this imbalance of interests in the current composition of the stakeholder group.

Find the full consultation paper on: http://www.esma.europa.eu/consultation/Guidelines-certain-aspects-MiFID-compliance-function-requirements#responses