Strict new rules from the Financial Conduct Authority requiring asset management firms to appoint independent non-executive directors will offer the sector an opportunity to break free of nepotistic policies that in the past dominated board-level appointments in this market.

From next year, all asset management boards must have in place a minimum of two of these non-execs so they make up at least 25% of the total board membership. Candidates cannot have been paid by the fund manager for five years before their appointment, nor have had any business relationship with the fund within the previous three years. Existing non-executives who don’t meet the criteria can stay, but they won’t count towards the quota of independents.