Compliance, Risks And Implications Of Managing Global Assets

With global footprints and exposure to global jurisdictions, investment management organizations confront more legal and reputational risks than ever before in maintaining compliance with various laws, rules, and regulations worldwide.

The compliance operations of asset managers are continually pushed to manage the low appetite for this risk to avoid reputational and financial damage. Failure to meet such duties has severe consequences, which are regularly reflected in the news, putting additional pressure on Trustees and Boards of Directors to manage this risk.

This, however, is a challenging task. Compliance departments must cope with continuing legislative changes as well as the introduction of new laws. It is tough to keep track of changes, especially at the global level. Furthermore, asset managers are typically presented with a legacy of internal operational challenges, manual processes, poor collaboration with third-party solutions, and outdated technology. Unlike other operational costs, compliance expenditures also tend to scale with the business.

A solid compliance management system is critical for protecting the business from regulatory and reputational risks. For many firms, establishing a unified global compliance program makes sense to provide a long-term, comprehensive, and scalable solution that ensures compliance, mitigates risk, controls costs, and allows the business to grow.