Nine months after being hit by its worst scandal in 60 years, the US mutual fund industry has suffered a significant regulatory defeat that will see it forced to appoint independent chairmen to its boards.
The SEC yesterday voted by three to two to pass the first and most contentious of the 16 reform packages planned for the industry.
The plan to require independent chairmen was opposed by almost the entire industry, and was passed despite a last-minute lobbying push by industry heavyweights such as Fidelity.
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Fund groups had argued that, since 75 per cent of directors would be independent, they should be able to choose their own chairman. They had argued that fund groups implicated in the scandal were not more likely than others to have inside chairmen.
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