The Portfolio Management Association of Canada (“PMAC”, formerly the Investment Counsel Association of Canada (“ICAC”)), through its Industry, Regulation and Tax Committee, is writing on behalf of its Members to request the Canadian Securities Administrators (CSA) to reconsider the new requirement under the CRM II rules to report performance on a money-weighted rate of return basis. Set out below is a summary of our continued position on the importance and desirability of allowing registrants the option of choosing to use either a time-weighted rate of return (“TWRR”) or a money-weighted rate of return (“MWRR”) calculation methodology with respect to performance reporting to clients. As you know, we have advocated for choice in performance reporting since the initial CRM II proposals were published. During our in person meetings with CSA staff and within our various submissions we have explained some of the significant concerns with mandating MWRR. These are further described below. In light of the CSA’s recent decision to move forward with mandating MWRR, and despite the fact that the rule is now final, we respectfully request a reconsideration of this approach.
