The new chair of the Canadian ETF Association (CETFA) expects them to continue to outsell mutual funds as he aims to build brand awareness around the advocacy group.
Steve Hawkins, president of CEO of Horizons ETFs, replaces outgoing chair Kevin Gopaul, global head of ETFs at BMO Global Asset Management, who has completed his two-year term. Horizons is a founding member of CETFA.
Hawkins, who brings 25 year’ experience in the investment industry to the role, will lead a membership that includes 20 ETF providers among its 46 members, who account for more than 95% of the country’s ETF assets under management. Horizons ETFs has more than $10 billion AUM and 90 ETFs listed on the major Canadian stock exchanges.
He told WP that his mission is to help the organization improve its advocacy and education programme, and lead the way for growth against the continuing pressures of the banks, which control distribution, and the mutual fund companies.
Hawkins also admitted to some issues within the CETFA membership that need to be addressed in order to make it as unified as possible.
He said: “There are so many ETF issuers in Canada now – it’s doubled in the past two years and the number of ETFs has also almost doubled. I’m not sure if those things are really good for the industry or not, but the fact remains that CETFA really wants to be the voice of ETFs from the advocacy perspective in Canada and I really want to help them achieve that goal.
“When we meet, we always think does anybody really know, from a regulatory perspective or government perspective, what CETFA stands for?
“We are not as well established as the Investment Funds Institute of Canada (IFIC), we don’t have the same resources but we think we are the little engine that can! We’ve been around for eight years now and the fact that ETFs have outsold mutual funds means I’m hitting the ground running. We have a great, strong wind behind us from an ETF perspective and that will help propel CETFA forwards as an advocacy group.”
The organisation’s membership continues to grow and iA Clarington Investments and CIBC Asset Management recently joined the organization after both firms introduced ETF products to market. There are currently 36 ETF providers operating in Canada, which is double the amount from 2016.
Hawkins now begins his two-year term intent on bringing all the members together despite each, naturally, having their own agendas. He cites the CRA and this year's budget as major issues and describes the latter, in its initial description, as concerning and potentially having a “material negative long-term effect on the ETF industry”.
He also wants to grow the membership, however, and believes the group is in a good place to push forward.
“As an industry, I very confident that ETFs are going to continue to outsell mutual funds over the next two years and I want to make sure there isn’t anything that we do as an industry that punishes us in any shape or form; that there aren’t any regulatory or rule changes from a government perspective that will negatively impact our industry without significant resistance.
“CETFA represents 95% of all ETF assets under management, so we have the right leaders in the room at our discussions. I think we can make things happen for the better of the ETF industry.”
President of CETFA, Pat Dunwoody, said: “Having worked alongside Steve Hawkins since CETFA began, I’m confident that his leadership, global profile and vision for the ETF industry will further propel ETF awareness and uptake.
“Innovation is at the heart of the ETF revolution and I know that is a principle that similarly drives Steve Hawkins.”
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