Both buy-side and sell-side firms will be impacted
by Conduct of Business (COB) provisions for sales,
trading and investment management. MiFID directs
firms to revise new and existing customer agreements
as well as reclassify clients (eligible counterparty,
professional customer, retail customer) with associated
suitability tests. Investment firms will be required
to assess investor suitability by obtaining information
about the client’s profile, knowledge and
experience of the associated product or service.
The extent of the information required will depend
on the product or service provided but the integrity
of this data across geographic, departmental and
product / service boundaries will be a critical
factor in maintaining customer satisfaction and
profitability. Firms will clearly need to demonstrate
consistency in the quality of client and market
information across analytical and operational
sides of the business.
