Recent research from PwC predicting that global assets under management will rise to around $101.7 trillion by 2020 from a 2012 total of $63.9 trillion provides good grounds for optimism here in the Channel Islands.
The report, entitled ‘Asset Management 2020: a Brave New World’, also finds that AuM in the SAAAME (South America, Asia, Africa, Middle East) economies are set to grow faster than in the developed world in the years leading up to 2020, creating new pools of assets that can potentially be tapped by the asset management industry.
Given its strength and experience in the asset management industry and its focus on international relationships, we believe the Channel Islands are well placed to play a significant role in the positive story outlined in this major piece of global thought leadership. The report provides a deeper dive into the impact of global economic, social and political mega trends on asset managers and is essential reading for all senior staff who need to keep abreast of changes in this industry’s landscape.
The report found that the global growth in assets will be driven by three key trends:
Asset managers will need to respond
PwC have identified six game changers that asset managers will have to analyse and address in order to capitalise on the opportunities this changing landscape presents:
The industry stands on the precipice of a number of fundamental shifts that will shape its future. Strong branding and investor trust in 2020 will only be achieved by those firms that avoid making mistakes that attract the ire of investors, regulators and policymakers. There is no single blueprint to building the successful asset manager of 2020 and beyond but they’ll have already started to shape their responses to these game changers.
The Channel Islands are well placed to address these issues and embrace the opportunities for a number of compelling reasons. In particular, we’ve a long history of providing quality administration, audit, legal and regulatory support which means that we should continue to be a conduit through which capital flows as it’s deployed around the world.
We should further build on these opportunities and services and ensure we get the message about what the Channel Islands can offer out to those with influence over the pools of new capital. In addition, we’re going to continue to see regulatory pressures on managers in places like London, Switzerland and Luxembourg. This could mean they’ll be looking for new places to operate, where the regulatory environment is much more conducive to managing assets.
However, we won’t keep up with pacesetters in this race without substantial foresight, courage and investment. The Islands’ focus on the Alternatives sector and our reputation as premier finance centres only serve to gain admittance to the race.
Thereafter, our ability to provide a platform of technology and expertise in data and systems, make us a contender. Finally, making this platform understandable to, and trusted by, new entrants to the market and different global players will see us in with a real shot of winning against what is sure to be really stiff competition.
To download a copy of Asset Management 2020: a Brave New World, visit our website http://www.pwc.com/jg/publications