Morningstar Announces Deployment of Due Diligence Module at Canadian Firms

TORONTO, March 16, 2022 /PRNewswire/ -- Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment research, announced today that it will be deploying its Due Diligence Module^SM as part of Morningstar® Advisor Workstation^SM (AWS) at Canadian wealth management firms to help advisors address the "Know Your Product" (KYP) element of the Canadian Client Focused Reforms (CFRs).

Morningstar's Advisor Workstation platform is a web-based investment planning platform containing capabilities for research, portfolio analysis, goal planning, sales presentations, and is used widely across the Canadian wealth management space. The Due Diligence module is a new addition to AWS providing a simple, guided workflow to help advisors perform the mandatory KYP requirements in evaluating a reasonable range of alternatives across a firm's approved product shelf. The Due Diligence Module was developed in consultation with industry participants, centering on a streamlined workflow to leverage Morningstar's industry-standard data and analytics.

Morningstar has deployed this solution at multiple large Canadian financial institutions including
BMO Nesbitt Burns and BMO Private Investment Counsel, Manulife Securities, and Sun Life.

"There is a natural divergence between the need for advisors to focus on servicing clients in an effective manner, and the recordkeeping requirements from a regulatory standpoint. We believe our solution bridges this gap, allowing for an intuitive and seamless workflow that not only helps address part of the KYP requirements, but also helps advisors make better informed recommendations to investors. We are thrilled Canadian wealth management firms are taking advantage of this solution," said Scott Mackenzie, CEO of Morningstar Canada.

The KYP element of the client focused reforms requires advisors to document that they have considered risk, structure, liquidity, and impact of costs over time when making a recommendation to a client. The overarching theme is the requirement for advisors to demonstrate they have made a suitable recommendation that puts the client's interest first, which in part requires a documented comparison of a range of reasonable alternatives. This consideration puts the onus on advisors to be able to quickly scan a firm's product shelf for what they deem comparable, which can be an arduous task given the sheer volume of investment options available.

The Due Diligence Module helps solve this by offering a scalable and efficient solution integrated into existing workflows and allows for documentation and metadata to be stored securely within a firm's compliance systems.

"Morningstar's module is effective at addressing this requirement in a streamlined way, and allows for our clients to keep a record documenting that the analysis was conducted. Moreover, we are pleased the module is integrated into Advisor Workstation, an industry standard platform for advisors, allowing for a quick rollout," said Alan Moorhouse, head of product and client solutions, at Morningstar Canada.

Morningstar Research Inc. is a Canadian subsidiary of Chicago-based Morningstar, Inc., a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, retirement plan providers and sponsors, and institutional investors in the debt and private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately US$265 billion in assets under advisement and management as of Dec. 31, 2021. The company has operations in 29 countries. For more information, visit www.morningstar.com/company. Follow Morningstar on Twitter @MorningstarInc.  

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SOURCE Morningstar, Inc.