In the run-up to the AIMA Global Policy & Regulatory Forum 2018, Arkk Solutions saw an opportunity to tap into the knowledge and experience of its investment industry audience.
Through a survey, we asked the 400+ delegates to share their views on cyber-security, their use of technology, and how their regulatory reporting requirements impacts their business.
Security, security, security
Working with AIMA prior to the conference, we knew that cyber-security would be front of mind at the event. Discussions of the day focused on where responsibility sits within a firm, and what this means in practical terms when working with vendors.
36% of respondents cited the resilience of their own systems as their biggest cybersecurity concern. This was followed closely by the risk of human error with 3/10 seeing this as the biggest risk. We hear this often from clients when using the online forms, as AIFMD requires over 300 data points to be reported on quarterly.
Whether at a Regulatory Forum or one of the countless Brexit Briefings on offer, technology – its role and impact – are sure to be a widely discussed and debated topic. But what exactly drives managers to use technology in their firms? We wanted to find out how, and more importantly why, investment managers used technology in their day-to-day business.
With 45% of the votes, the greatest factor for using technology was to improve operational processes. This tied in with one of the live polls at our RegTech panel, where an overwhelming 81% of respondents said that they primarily used technology as a response to regulatory requirements and to manage costs, rather than for strategic business decision making.
Interestingly, less than 1 in 10 respondents used technology primarily to maintain a competitive position in the market, and not one respondent uses reporting technology to improve their client experience. Since its inception, this has been a key driver behind our AIFMD product development.
Improving the regulatory landscape
The AIMA conference presented the perfect opportunity to ask leading managers what they really felt would improve the regulatory landscape.
A reduction in the scale of reporting saw the lowest vote – just 1 in 10 respondents thought this would improve existing reporting systems.
Feedback from 40% of respondents indicated that greater global consistency in reporting requirements would be the most beneficial to filers. Whilst many of the regulations Arkk supports must be submitted in a specific format, AIFMD filers have a multitude of options to choose between.
Top regulatory reporting challenges
Whilst we’ve seen that investment firms’ number one suggested improvement for regulatory reporting is to increase global consistency, we know there are a whole host of other challenges that filing brings. With that in mind, we wanted to know the top three challenges facing investment managers.
Over 70% cited the time taken to gather data for reporting, and the lack of internal staff resources to complete reports as the greatest challenge. This suggests that streamlining the process, from linking to previous data and reducing the manual burden on in-house teams, would take away the biggest challenges for filers.
Following close behind was time taken to populate reporting templates. Finding a solution which allows you to roll-forward static data could reduce this for the 65% of respondents who found this a burden. A third of respondents said filing to multiple jurisdictions was a challenge. A useful checkpoint is to ensure all AIFMD jurisdictions are covered by your chosen solution and that the templates you need are accessible with every new ESMA update.
Check back next week when we’ll share the full stats of the reporting technology survey in a handy infographic. Or if you’d like us to email you the report, get in touch with the Arkk team today.