Cost growth, squeezed margins and the requirement for greater scale has been a feature of our industry over the last few years, which has challenged asset managers to innovate to protect profits.
Innovation among asset managers and asset servicers has become increasingly complex, often driven by specialised entrants. The asset management industry was also ripe for consolidation, with smaller players the most likely targets.
Today's needs for proportionate risk management — in the form of appropriate governance, risk appetite, procedures and effective use of risk management frameworks — has never been greater.
Innovation has also played a significant part in these processes and, together with effective risk mitigation, is a vital source of differentiation. Asset managers have been impacted by a raft of regulations which has pushed up costs and, at a macro-prudential level, strategies were developed to address the need for high-quality capital to bolster common practices and strengthen crisis management procedures.
As the industry has matured, tax was becoming an increasingly complex issue in terms of reporting and at an investment portfolio level. Running a successful asset management business is about the need for sound risk management and innovation to produce sound returns and profitability.
Today, we are able to fully demonstrate that the products or services we offer will lead to customer satisfaction under varying market conditions.