The primary concerns of firms working in asset management – such as disruption from robo-advice and the challenge of managing alternatives – have all receded over the past year to make way for worries connected to political change.
The Brexit vote, the election of Donald Trump and the possibility of a swing towards right wing populism in Europe have become the year’s defining trend in the eyes of asset managers and related firms such as custody banks across all geographies, a survey by Linedata, a software firm, found.
Cybercrime, the dominant concern last year with a 33% score, fell to 18% this year, for example.
“Few industries are so inextricably tied to wider social and geopolitical trends as asset management, and turbulence across Europe and North America was at the forefront of respondents’ minds during the (survey],” Linedata said. Last year’s main concerns have been “comprehensively relegated to second-tier issues”.
Meanwhile, nearly a quarter of respondents highlighted political and policy change as the primary disruptive force in asset management: a concern that did not even rank in last year’s survey.
Nevertheless, it is regulation that continues to represent a major challenge for asset managers, although there were significant regional splits in the extent to which respondents prioritised this issue.
Half of all respondents categorised “adapting to regulation” as the number one concern today, with 53% also seeing it as the biggest issue over the next three years.
This means that regulation has been the primary concern in six of the seven years that Linedata has surveyed the industry.
Cost cutting and investment performance were also cited as significant concerns.
Linedata gained 126 respondents across the world and carried out the survey in Janauary.
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