The investment management industry has seen several key changes in the past few years, with one of the most notable trends being regulator-driven changes in the mutual funds industry. Some of the significant shakeups that have sent firms scrambling have been the SEC modernization rules and the liquidity risk management program.
These regulatory changes and others have a major impact on firms’ reporting processes, data, and infrastructure. In addition to an increased regulatory burden and increased risk reporting, operational and technology changes are required in order to manage changes to larger data sets and the impacts on operational workflows.
Outsourcing, particularly of functions related to data, technology, and regulatory reporting, is becoming more popular among fund operators.
This is driven by an increasingly complex set of regulatory and technological requirements that make running the back-office operations of a fund a challenging and resource intensive task.
Explosion of Data and Management Challenges
As data becomes increasingly more complex, it has impacted how asset managers are able to operate in a competitive field, and an enhanced data management process is necessary to stay ahead of the curve.
They also need to cut costs related to the storage of redundant data across the organization. Better data management is a means of achieving that, utilizing one data store for all operational needs
The increased and increasingly detailed audit demands set by regulators increase data costs and risks, as reports prepared for different regulatory purposes must be reconciled to achieve consistency.
Inefficient data management is expensive and risky for asset managers. Fully automated compliance packages, like Delta Data’s data and analytics, give firms an integrated data, analytics, reporting, and transparency solution that summarizes key metrics from all oversight initiatives.
Cost Savings and Operational Efficiencies
The operating environment within the mutual funds industry is evolving at a sharp rate, requiring a renewed perspective. In order to ensure successful and efficient transitions, asset management firms should proactively pursue opportunities for operational updates to address these ever-changing industry dynamics.
In addition, fund managers can utilize the expertise of the third-party provider and benefit from their experience in supporting multiple funds companies, gaining access to the latest trends and technology at a lower cost compared to implementing it themselves.
Leveraging today’s innovative technology and scalable solutions can significantly reduce costs and enhance operational efficiencies. Comprehensive platforms, like Delta Data’s Asset Management Solutions, provide the structure and flexibility to handle the complexities of today’s operational functions, featuring the necessary scalability, stability, control, and security to meet the challenges of business growth.
Fund managers reap the benefits of using these systems through the third-party solutions, saving themselves from the costly investment and time-consuming implementation, training, and maintenance of in-house technology.
The most efficient way for firms to adapt to the changing landscape is to adopt the processes and platforms now that enable them to stay ahead of impending regulations.
Relying on an Experienced Partner
Ensuring your fund is in compliance with ever-changing regulations can be an intricate undertaking and can easily take up valuable time and resources that are better-served elsewhere. A service provider with proven experience implementing compliance programs, technology, and processes to meet new regulatory requirements can alleviate much of that burden for firms. A reliable partner can offer comprehensive, timely solutions.
Third-party providers can help firms stay ahead of the curve and in front of the regulations, while enabling effective integration of back-office functions, and freeing up the time and resources that firms must dedicate to their core competencies.
Strategic partners should understand the demands of a changing landscape and the challenging operational environment of the mutual funds industry, supplementing the data requirements, sources, integrations and delivery services needed to support financial, regulatory, audit, and analytics needs of the firm.