Mary Jo White is worried about ETFs, mutual fund service providers, and NAV pricing, and she wants to revamp disclosures.

Mary Jo White Securities and Exchange Commission Chair

Those are the SEC Chair's key themes this morning in her keynote address at the 2016 ICI GMM at the Washington Hilton. This is her fourth consecutive keynote appearance at the ICI.

Before looking further into the future, White reminds fundsters of the current SEC projects focused on the mutual fund industry, including the new liquidity risk management program proposal and the proposed derivatives use regulation. The Flash Crash of 2010 and ETFs' role in it and NAVgate and the Third Avenue Focused Credit Fund Collapse of 2015 all loom large over White's remarks, and she directly points to all three events.

As for what White sees (or wishes for) for the future of mutual fund industry regulation, she alludes to many subjects but highlights four: "whether the disclosure regime for registered funds has evolved sufficiently"; "the unique and pressing challenges that arise from the ETF structure"; "the risk in using technology and service providers"; and the challenge of "pricing portfolio holdings and determining per share net asset values (NAV) accurately". ETF shops, speak up now, and fundsters, be prepared to have a plan B for your service provider relationships.

"It is important that a fund is adequately prepared to promptly and effectively respond to risks that may be triggered by service providers and its own use of technology, including implementing alternative and reliable means to satisfy the fund's regulatory requirements," White states.

As she and the SEC staff have before, White also points to cybersecurity as a particular area of worry.

"You, as management executives, are the standard bearers for your industry and must foster a culture in your organizations that prioritizes responsibility and fairness and asks first -- and last -- what is in the best interest of investors," White concludes. 

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