Regulatory Alerts2026-04-24
Report on Inspection of the Board's Follow-up on Costs and Returns in Investment Company IA Invest
The Danish Financial Supervisory Authority issued an inspection report on 24 April 2026 following a November 2025 thematic review of Investment Company IA Invest, finding that its board lacked clear, objective criteria and defined processes for monitoring sub-fund returns and costs. Consequently, the regulator issued a directive requiring the company to implement adequate reporting mechanisms, establish explicit evaluation criteria in its governance documents, and develop procedures to address underperforming or overcosted sub-funds. The inspection underscores the mandatory obligation for investment company boards to continuously ensure market-conforming performance and competitive costs to safeguard investor interests.
Inspection Report 24-04-2026 On 14 November 2025, the Danish Financial Supervisory Authority conducted a thematic inspection of Investment Company IA Invest. The purpose of the inspection was to examine whether the board conducts adequate follow-up on returns and costs in the underlying sub-funds, with a view to ensuring that investors' interests are safeguarded securely.
The inspection was conducted in accordance with Section 163, subsection 1 of the Act on Investment Companies and Other Investment Undertakings, and was carried out as part of a thematic inspection where the same area was examined in three different investment companies.
Summary and Risk Assessment
The board of an investment company must act independently and solely in the interest of the investment company [1]. Safeguarding investors' interests requires that the board of the investment company continuously assesses whether the sub-funds' returns and costs are market-conforming and competitive, including ensuring that investors receive value for their payments.
The board of the investment company has not established clear and objective criteria for monitoring returns and costs. Consequently, the handling of returns and costs may vary across the individual sub-funds, and there is a risk that the board fails to address inadequate returns or excessively high costs.
At the same time, the board has not defined a clear process for further follow-up on sub-funds with unsatisfactory returns or high costs. This creates a risk of inadequate follow-up.
The investment company has therefore been issued one directive. The directive requires the investment company to ensure adequate reporting for the board's evaluation of returns and costs, and that the governance documents contain clear and objective assessment criteria for both returns and costs. Furthermore, the board must have procedures to explore possible measures to achieve a satisfactory return and cost level.
[1]
see Section 47 of the Act on Investment Companies and Other Investment Undertakings.
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