Two months on from the Markets in Financial Instruments Directive II (MiFID II) implementation date, how are your financial promotions measuring up? Are you confident that you understand the implications of the new regulation? And that your marketing is in line with its requirements?

Here we revisit the MiFID II and explore what you should be doing to comply.

  • What is MiFID II?

The Directive came into effect in January 2018. While many of its changes relate to operations and delivery, some directly affect marketing and financial promotions.

You should already have tackled these, but as with all regulation, there can be things that slip through the net. So we thought it was worth rounding up the changes it introduces so you can check that you’re delivering on all of them.

  • What does MiFID II change for marketers?

Our blog on What is MiFID II and what do you need to do to comply? outlines some of the background to the new rules.

For Marketing teams, one of the biggest changes is the fact that all communications to professional clients are now viewed as financial promotions.

As a result, they have to meet all the FCA’s financial promotion requirements. They need to go through the same review and approvals process as any other piece of regulated marketing material.

This adds an extra layer of complexity to your communications process – and can mean it takes longer to get materials published.

  • Follow these steps for MiFID II-compliant communications

The good news is that there are some fairly simple steps you can take to tackle and mitigate the impact of the Directive on your communications.

  1. Make sure your whole team understands what constitutes a financial promotion, and what this means in terms of regulatory requirements. This will enable them to write compliant copy and build time for review into their project management. Read more about how you can write Compliance-ready content first time.
  2. Familiarise yourself with requirements around risk warnings. Not just when to use them, but also rules around size and prominence (under the new Directive, risk wording needs to be in the same point size as the main text).
  3. MiFID II introduces new rules around the way performance data used in charts needs to be displayed for retail and professional clients. If you produce a lot of charts and information documents, using a slide library or other tool that enables you to lock down accurate, approved data can be invaluable. Read more tips on best practice charts and how to ensure your presentations are compliant.
  4. Language can fall foul of FCA requirements. Make sure you understand the rules around suitability and using wording appropriate for the audience.
  5. Because you need Compliance approval on a wider range of materials, making your approvals processes as efficient as possible is vital. Regulated firms are increasingly adopting marketing automation tools, which can help with more efficient project management – as well as preventing regulatory breaches by mandating compliance sign off. Read more tips for efficient sign off in our 6 ways to make your approval process better.
  6. Does your team produce all of your client communications? In professional services firms, materials are often produced throughout the business. Your team will need to get a grip on all the content produced, and make sure it meets FCA standards.
  • What other changes has the new Directive introduced?

It’s not just client communications that need to change under MiFID II. You may need to modify your approach to adviser marketing, as the new rules have tightened up requirements on hospitality. They also potentially affect sponsored content on adviser websites or in newsletters.

The new rules bring a number of changes and added requirements for Marketing teams. Using a checklist to make sure you have ticked all the boxes can help you to feel confident that your approach complies.

We’ve produced a free MiFID II checklist, as well as a summary of the Directive’s requirements to help you work through the required changes and make sure you’re addressing them. You can download your copy of the free summary and checklist as well as other useful material here.

Source: Perivan Technology

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