Reputation of fund managers at risk
The Australian funds management industry is continuing to experience good growth, but fund managers are going to have to do more to win the trust of investors, according to a survey by PriceWaterhouseCoopers (PWC).
The survey, released at the Investment and Financial Services Association (IFSA) national conference in Brisbane, found investment managers needed to ensure that they had equipped themselves with operational risk management systems that could cope with increased regulatory focus.
The survey is based on the views of 31 investment management organisations, and has identified financial services reform legislation as the biggest risk management issue facing fund managers.
It said human resources issues and unit pricing errors were seen as the next most pressing issues.
“The survey shows that investors are demanding integrity and trustworthiness when choosing a fund manager,” the survey analysis said.
It also shows that brand image and reputation offer a strong opportunity for profit, but problems like unit pricing errors can lead to large losses and “reputation errors,” PWC’s insurance and investment management group partner Peter van Dongen said.
However the survey showed that, overall, the industry continued to experience good growth with assets under management increasing by 15 to 18 per cent in the current year.
It said the outlook for industry was also optimistic, with half the respondents expecting growth of more than 20 per cent in three years time.
Recommended for you
Australian fund managers are actively seeking to launch Cayman versions of their funds to attract offshore flows, with Regal Partners set to launch its latest offering this month.
As private markets gain traction in Australia but only a limited pool of talent is available, three recruiters explore whether fund managers should consider looking overseas to find top talent.
With an explosion of private credit managers appearing in the market, two alternatives experts believe a consolidation is needed to maintain the quality of the sector.
Bentham Asset Management has become the latest fund manager to expand its distribution team as it reports increased interest in its credit strategies.
