Good risk management relies on the subsidiary status principle The European Commission consultation on the UCITS depositary function is necessary and welcome, because it puts an end to a long period of European ignorance of the importance of the depositary function to the construction of a single market for investment funds. The European regulator long focused on the responsibilities and obligations of asset management firms and on adapting the UCITS framework to new asset classes or to changing investment practices, as it mistakenly believed that stewardship would follow, and it thus paid too little attention to operational problems and the management of non-financial risk in the European fund industry. More...