Securities and Exchange Commission

Quite rightly, there are veritable storms in capital markets conferences and the press about what needs to be done to prepare for MiFID II, due to take effect in 4+ months. There seems to be little chance for a further stay of execution, but then, with remarkable irony, MiFID I hit securities trading in November 2007 as the Global Financial Crisis was deepening, leading to the most massive destruction of capital in decades, and so undermining large swathes of the world economy. Regulators cannot time such matters, and the preparation of reforms based on broad public consultations and multiple drafts takes years. Still, we are where we are: perhaps some sort of progressive implementation would be sensible. If the authorities are certain of the value of their objectives, then surely it would be worth demonstrating some flexibility.

Thomas Murray was founded 24 years ago to assure that investors’ property is respected by custodian banks. This was a time when institutional portfolios were spreading investments across multiple jurisdictions, a trend that has accelerated over this past quarter century. The firm’s remit widened to cover the spectrum of post-trade services, always with the same focus on investors’ safety and rights. Shareholder rights are, in fact, central to the financial system, and so also the key focus of Thomas Murray’s work.

Shareholder rights are a critical economic concern: when the members of the public are asked to hand over hard-earned savings as an investment in a corporation, whether in a stock or a bond or another financial instrument, the managers of that enterprise have an immediate obligation to handle that money fairly and honestly. Without trust in proper conduct by those managers in growing the enterprise such that value is created, we will not have the investment or capital formation (or jobs, or goods and services!) that our societies need.

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