COVID-19 has presented many challenges, and provided many opportunities to learn lessons. The Asset Management industry has demonstrated strong resilience in dealing with the challenges presented, with some participants weathering the storm better than others.
COVID 19 has shown us that remote working can work. But successful businesses cannot just get by. Businesses need to build on the resilience demonstrated and enhance their digital capability, re-focus their core activities and consider alternative solutions to non-core activities.
The old saying of the Customer is king remains as valid as ever. Lock-down and the temporary removal of non-essential travel has reduced customer face-to-face time. Sustaining relationships is a huge part of the asset management industry. If we can’t meet our customers, we need to find alternative ways of engaging meaningfully with them.
Customers and investors, as well as employees want more than just financial returns. There is significant momentum in ESG(Environmental, Social, and Governance) initiatives. Stakeholders want to know the business purpose beyond financial returns and how these objectives will be met and how success will be measured.
1. Redefining business and operating models
What it means
COVID-19 has crystallized the need for asset managers to transform business and operating models to become more resilient, agile and flexible in a challenging environment.
Potential impact on asset managers
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2. Accelerating digital, transforming through technology
What it means
The industry has been slower to adopt new technologies than many other sectors. COVID-19 has been an awakening
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3. An evolving risk & regulatory landscape
What it means
Regulators want to encourage recovery and growth, but ensure that happens in a controlled way that protects financial stability and takes greater care of customers.
Potential impact on asset managers
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4. Redesigning the future of work
What it means
Operating in a more decentralized environment has focused minds on the need for change as a new future of work emerges.
Potential impact on asset managers
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5. Embedding ESG across the investment approach
What it means
The shift towards sustainable finance has markedly accelerated. In the wake of COVID-19, this trend will be even more pronounced.
Potential impact on asset managers
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6. Look East: navigating business opportunities in China
What it means
China has long been recognized as the biggest single opportunity for new business and growth in the asset management industry – COVID-19 hasn’t changed that.
Potential impact on asset managers
Beyond a world dominated by COVID-19-related restrictions on economic activity, we anticipate opportunities for fund managers to either expand their existing footprint or enter China for the first time.
What to think about: