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Managed investments, managed disclosures: financial services reform in practice

Haigh, Matthew (2006). Managed investments, managed disclosures: financial services reform in practice. Accounting, Auditing & Accountability Journal, 19(2) pp. 186–204.

DOI (Digital Object Identifier) Link: https://doi.org/10.1108/09513570610656088
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Abstract

Purpose
– Recently enacted Australian law governing financial services requires investment managers to report to what extent social considerations are employed in portfolio construction. Using the principal‐agent framework as an interpretive backdrop, the paper aims to analyse institutional responses to the introduction of the legislation.

Design/methodology/approach
– The paper distinguishes formal, claimed accountabilities from practised accountabilities. It identifies practised accountabilities by examining legislative requirements, noting responses of mainstream investment banking institutions in the period of legislative development, interviewing a sample of investment managers, and examining a sample of information disclosures issued in the initial period of the legislation.

Findings
– The paper finds that while appeasing investment managers and the lobby group that urged for the disclosures, the non‐prescriptive regulations promise little in terms of promoting the integrity of management practices. Initial disclosures were poor, providing little basis for comparability.

Research limitations/implications
– The paper provides a basis to investigate accountabilities in service‐based contractual relationships, particularly managed investments.

Originality/value
– The paper introduces a new research field: social reporting in financial services. The period reviewed was the initial reporting period in which Australian practitioners were required to issue social reports. Counterpart European legislation has not attracted scholarly attention. A contribution is made to critical research on social investment.

Item Type: Journal Item
Copyright Holders: 2006 Emerald Group Publishing Limited
ISSN: 0951-3574
Keywords: Financial services; Law reform; Social audit; Australia
Academic Unit/School: Faculty of Business and Law (FBL) > Business > Department for Accounting and Finance
Faculty of Business and Law (FBL) > Business
Faculty of Business and Law (FBL)
Item ID: 50566
Depositing User: Matthew Haigh
Date Deposited: 18 Aug 2017 13:24
Last Modified: 11 May 2019 18:24
URI: http://oro.open.ac.uk/id/eprint/50566
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