Global

Details

  • Industry: Financial Services, Investment Management, Private Equity, Real Estate
  • Type: Survey report
  • Date: 10/11/2013

The impact on operating models 

Impact on operating models
So how are increased regulatory scrutiny and compliance costs influencing the operating models of hedge funds and managers? According to the data, two fairly equal camps are starting to emerge – those that will use regulatory change to proactively transform their operating models and those that would prefer to react to change as it happens.

Taken on face value, the survey data would suggest that fund managers were unsure how regulatory change would impact their operating models. An equal number of respondents – 48 percent respectively – said that they had considered changing their operating models in response to regulatory change as said that they hadn’t.


Counter to popular opinion, our research shows that the majority (56 percent) of fund managers would not consider exiting markets or lines of business due to increased regulatory pressure, nor have the majority (55 percent) considered moving their fund domicile, management company and/or center of main economic activity to an alternative jurisdiction in response to regulatory change.


Two exceptions exist, however: 52 percent of respondents from Europe said they had considered moving their fund domicile, management company and/or center of main economic activity; while 50 percent of the managers representing the largest funds (with AUM of USD5 billion and up) said they had considered exiting markets or lines of business due to increased regulatory pressure.


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