Kickbacks: In the Age of Disruption - A qualitative study on institutional disruption on the Swedish mutual fund market

Sammanfattning: This thesis examines if and how an institutional disruption, in this study a regulatory threat, impacts institutional rules and competitive dynamics in the Swedish mutual fund market. In recent years, the industry has faced multiple disruptions, mainly stemming from financial technology, putting additional pressure on regulators and organizations to adapt. However, previous research has shown that also regulations can be a disruptive force. Since implementing the MiFID II regulation in the European Union, several nations have prohibited fund distributors from receiving a kickback. The discussion of a prohibition in Sweden has been brought to the front again because of a statement in the media by the Swedish Financial Supervisory Authority. This thesis is a qualitative study based on nine interviews with industry participants. The theoretical lens, consisting of neo-institutional theory and Porter's five forces, is used to analyze the individuals' perceptions of the regulatory threat to gain a deeper understanding of the competitive dynamics in the market. When analyzing the empirical data, we conclude that institutional disruption in the form of a regulatory threat leads to heterogeneity because of changing norms. However, neo-institutional theory suggests that the organizational field will become more homogenous over time with support from empirical data. It is also concluded that competitive dynamics are affected, facilitating new entrants, encouraging price reduction and customer focus, and backward integration. Summarily, the thesis provides a perspective on how competitive dynamics are affected by institutional change caused by an institutional disruption.