Regulation woes disrupt asset owners’ slumber
Australian asset owners are tossing and turning at night as they try to keep up with and meet regulations of all sorts, according to research.
The BNP Paribas ‘Asset Administration and Custody Review' showed regulation is keeping up two-thirds of the respondents (67 per cent) up at night.
About 87 per cent said their costs had gone up in trying to meet those regulations while many said they could not pass those costs on to end investors.
Around 8 per cent do not even know how regulation will hit their cost base, while over half are tackling regulation with their own resources and up-skilling their teams.
A third of respondents (31 per cent) worry about how to cut costs further.
Second on the list of concerns was meeting performance targets, with 45 per cent losing sleep over it.
Staff management and resourcing issues worried 32 per cent.
"The most concerning operational issue is risk management — improving risk analytics and improving the risk-return profile of their portfolios — which worries over two-thirds of respondents," managing director Peter Baker said.
"More than half (53 per cent) want a better understanding of their investment risk, with two out of five (42 per cent) not satisfied with their risk reporting."
Only 5 per cent said nothing concerned them.
AUTHOR
Malavika Santhebennur
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