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Expectations for U.S. based investment companies’ narrative disclosures continue to evolve from a regulatory and best practices perspective. As a result, boards of trustees, investment advisers and other service providers must remain informed to enable transparency and compliance. This article highlights key areas of focus based on recent regulatory changes, risk alerts and enforcement activity.

Say What? Keeping Current with U.S. Fund Disclosures

Stay up-to-date on the latest global financial services regulatory trends and impacts by following the new Insights series from the Trustee and Fiduciary Regulatory Services Team.

Global Regulatory Impacts Series

Article

On 11 October 2027, the financial markets of the European Union (EU), United Kingdom (UK), and Switzerland and Liechtenstein, will, or are considering moving to a T+1 settlement cycle, bringing them into line with other financial centres that have already commenced or completed the move.With both EU and UK governments calling for greater inward investment, either to boost growth, finance digital, green and social transition, or just encourage greater retail investment in securities markets, reducing the time it takes to settle trades is seen as key to meeting these aims.&nbsp;In reducing the settlement cycle, markets in the EU, UK, and Switzerland and Liechtenstein will join jurisdictions already operating T+1, such as China, India, the United States and Canada.&nbsp;Following extensive consultation and industry feedback, the UK government and European Commission plan to amend their respective versions of the Central Securities Depository Regulation to provide legal certainty so as to ensure T+1 settlement is implemented on 11 October 2027.&nbsp;This date has been selected to give market participants time to update and adapt systems and processes.&nbsp;Joining the EU and UK, the Swiss Securities Post-Trade Council (swissSPTC) has also recommended that the transition to a T+1 Settlement Cycle for the domestic markets in Switzerland and Liechtenstein should occur in October 2027. SIX, the operator of the Swiss exchange, has committed to gaining adjustments to the Rule Book of SIX Swiss Exchange to accommodate the change of the settlement cycle at the appropriate time.In this article we consider each of the European proposals in more detail in terms of background leading up to the proposals, suggested approaches, along with actions still to be taken.

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On 11 October 2027, the financial markets of the European Union (EU), United Kingdom (UK), and Switzerland and Liechtenstein, will, or are considering moving to a T+1 settlement cycle, bringing them into line with other financial centres that have already commenced or completed the move.

All Aboard the Train Bound for T+1: Next Stop, October 2027

If you are a parent, you will be only too familiar with the childish refrain, ‘are we there yet’ – often repeated on any journey, regardless of length. The same may be heard as regards sustainability regulation, which has been at the forefront of regulators agendas for the last six years or so.This article looks to answer that question, ‘Are we there yet?’&nbsp;Well, the answer to that specific question is still ‘no’, and to be able to expand on why, we need to root our journey back in 2024 and project forwards to 2025 and beyond.Our latest article looks at regulations which are due to enter key milestones during 2025, along with what is still to come in terms of further regulatory developments, with the potential to impact a variety of industry segments.By nature of its subject matter, our latest piece is broad in terms of coverage looking at:<ul style="list-style-type:disc;"><li>ESG Ratings Regulations,</li><li>Global sustainability reporting,</li><li>Ongoing developments in the EU and UK around the potential to simplify sustainability regimes such as the EU SFDR, UK SDR, and due diligence obligations for the entire value chain,</li><li>ESG risks,</li><li>Residual ESG considerations arising from the use of AI and digital assets,</li><li>Early indications for potential ESG regulatory changes in the US,</li><li>Net zero and transition planning, and</li><li>An evolving focus on nature.&nbsp;</li></ul>As companies move through 2025/2026, we look at how the ESG landscape is characterised by both challenges and opportunities.&nbsp;Companies must remain vigilant and adaptable, embracing integrated and strategic approaches to ESG and sustainability (including in relation to the terminology used) to ensure business resilience.&nbsp;By staying informed and proactive, organisations can navigate the complexities of ESG, and sustainability matters and position themselves for long-term success in an ever-evolving global environment. &nbsp;

If you are a parent, you will be only too familiar with the childish refrain, ‘are we there yet’ – often repeated on any journey, regardless of length. The same may be heard as regards sustainability regulation, which has been at the forefront of regulators agendas for the last six years or so.

Sustainability Regulations: Are We There Yet?

The global environment continues to be filled with risks and uncertainties relating to future US policy proposals, global growth prospects, evolving geopolitical tensions and technological development.&nbsp;Asia-Pacific regulators remain alert to these global challenges, responding in an agile manner whilst also seeking opportunities and creating policy headroom.As the continuing trend of wealth creation in Asia drives demand for more sophisticated savings and investment offerings, regulators across Asia are increasingly focused on regulations that are designed to cater to this demand while also keeping a watchful eye on protecting investor interests.&nbsp;This is coupled with a greater focus on operational resiliency and risk management and evolving geopolitical developments.&nbsp;To learn more about regulatory trends and priorities in Asian markets such as Hong Kong, Singapore, South Korea and Australia over the next couple of years, across different market segments, covering topics such as:<ul style="list-style-type:disc;"><li>Combatting AML;</li><li>Sustainability;</li><li>Digital assets and tokenization;</li><li>Capital requirements;</li><li>Latest funds’ developments;</li><li>Corporate governance;</li><li>Artificial Intelligence;</li><li>Operational risk and continuity planning;</li><li>Data transformation;</li><li>Valuation guidance and liquidity risk management; and geopolitical risks.&nbsp;</li></ul>

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The global environment continues to be filled with risks and uncertainties relating to future US policy proposals, global growth prospects, evolving geopolitical tensions and technological development.&nbsp;

Asia-Pacific Regulatory Priorities for 2025 – Predictable Unpredictability 

Post the UK’s departure from the European Union (EU), we entered a realm of UK/EU financial services regulation, which has lost its harmonised nature, which included relying on passporting rights across EU Member States.&nbsp;UK policy makers were now free to take advantage of their expanded rule making powers whilst the EU continued to chart its collective path.&nbsp;Since then, successive UK governments have called for policy makers to prioritise growth in the UK economy, while in the EU, the European Commission has launched the Savings and Investments Union, aimed at creating better financial opportunities for EU citizens, while enhancing the EU’s financial system’s capability to connect savings with productive investments.&nbsp;In this article we look at the current approaches to financial services regulation by the EU and UK, noting any divergence, and looking at whether emerging differences are progressing towards similar outcomes or different policy objectives.&nbsp;We look at the latest and planned regulatory developments in the EU and UK, impacting a variety of financial services firms. These include:&nbsp;<ul style="list-style-type:disc;"><li>MiFID II/MiFIR;</li><li>EU PRIIPS vs UK CCIs;</li><li>EMIR;</li><li>UCITS Directive;</li><li>Eligible Assets Directive;</li><li>Money Market Funds;</li><li>AIFMD;</li><li>ELTIF vs LTAF;</li><li>Loan Originating AIFs;</li><li>T+1; and</li><li>Short Selling Regulations.</li></ul>We also look at how the EU and UK have been managing divergence through the introduction of the Joint EU-UK Financial Regulatory Forum.

Post the UK’s departure from the European Union (EU), we entered a realm of UK/EU financial services regulation, which has lost its harmonised nature, which included relying on passporting rights across EU Member States.&nbsp;

Continental Drift: Financial Services Regulation in the EU and UK

Expectations for U.S. based investment companies’ narrative disclosures continue to evolve from a regulatory and best practices perspective. As a result, boards of trustees, investment advisers and other service providers must remain informed to enable transparency and compliance. This article highlights key areas of focus based on recent regulatory changes, risk alerts and enforcement activity.Disclosure requirements for registered investment companies (including mutual funds and exchange traded funds, or “funds”) have expanded in recent years, driven by regulatory changes and heightened expectations for transparency.&nbsp;Implementing robust disclosure practices is essential for helping to maintain a strong culture of compliance, mitigating legal and reputational risks, and upholding the core principle that investors should have access to full and fair disclosures.This article explores recent evolutions in narrative disclosure requirements that apply to funds, highlighting key areas of focus for compliance while providing insights on how company policies can be updated to adapt to the regulatory landscape.&nbsp;It further explores:&nbsp; •&nbsp;&nbsp;&nbsp;&nbsp;SEC Exams and Disclosures •&nbsp;&nbsp;&nbsp;&nbsp;SEC FY 2025 Exam Priorities •&nbsp;&nbsp;&nbsp;&nbsp;2024 Risk Alert Observations and Disclosures •&nbsp;&nbsp;&nbsp;&nbsp;Recent regulatory changes impacting funds’ disclosure obligations •&nbsp;&nbsp;&nbsp;&nbsp;Tailored shareholder reports and disclosure of material fund changes •&nbsp;&nbsp;&nbsp;&nbsp;Shareholder reporting amendments •&nbsp;&nbsp;&nbsp;&nbsp;Proxy voting and share ownership •&nbsp;&nbsp;&nbsp;&nbsp;Names Rule •&nbsp;&nbsp;&nbsp;&nbsp;Artificial Intelligence •&nbsp;&nbsp;&nbsp;&nbsp;CybersecurityAdopting a well-structured and proactive approach to disclosure processes can mitigate compliance risks and demonstrate a commitment to transparency, accuracy and sound governance practices.

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