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Transform to become the asset and wealth management firm you’ve envisioned

The asset and wealth management (AWM) industry—much like the broader financial services sector—faces massive disruption as a result of the COVID-19 pandemic, the Russia/Ukraine war and, more recently, its associated sanctions. The industry, like others, has lost talent to the Great Resignation, while simultaneously trying to devise a strategy around cryptocurrencies and other digital assets. 

This has exacerbated other challenges facing the industry, including intense fee pressure, rising costs and changing investor preferences. AWM firms are responding to these unparalleled challenges by rethinking their businesses, expanding into new client segments and diversifying their product offering through acquisitions, scaling with new asset classes and enhancing product innovation. 

Some firms have taken bold steps in transforming their organizations to meet today’s challenges head on, while others have stumbled in such areas as product and talent development, digital technology adoption and with implementing other levers critical to cutting costs and improving operations.

There’s no time to waste. Firms that don’t transform may face disruption, risk irrelevance or, even if successful in growing, become too complicated to be managed effectively.

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Visualizing the transformation of the AWM value chain

Working with clients across the AWM value chain, we’ve found that a major barrier to success is that many firms approach this challenge in silos: which product to launch, segment to go after, process to digitize, etc. Few have managed to make much progress across the board. Firms are also very worried that radical change risks cannibalizing their existing business, disrupting their ecosystem or jeopardizing their partnerships.

We believe transforming to stay in step with a rapidly evolving business environment requires a holistic approach that impacts many aspects of your organization. You’ll need to take a series of actions that will enable you to be the firm you’ve envisioned.

This is our look at the current industry landscape and what’s ahead for AWM firms—the trends and the platforms that leaders can use to help drive growth, and some of the strategic choices that may lie ahead.


Key actions

  • Be Transformational: Reinvent your business model to survive and grow
  • Be Innovative: Upgrade your product suites to stay current
  • Be Tech and Digital Enabled: Redefine how you operate through technology
  • Be Developers of Talent: Transform your people and culture

“Firms across the AWM value chain are making strategic decisions on which businesses they want to be in and how. You’ll need to take a holistic approach to transforming your organization to keep pace with the rapidly changing AWM industry.”

Bernadette Geis, Asset and Wealth Management Trust Solutions Leader, PwC US

1. Be Transformational: Reinvent your business model to survive and grow

Investors poured $1.2 trillion into U.S. long-term mutual funds and exchange-traded funds in 2021—nearly double the previous annual record of $689 billion set in 2017.1 But despite the record flows, fees collected by active managers declined by 4% in 2021.2

In response to today’s fee pressure and changing investor preferences, market leaders have been positioning themselves by expanding their product offering, moving into new asset classes and investor segments or building new channels to capture more of the investor wallet. 

AWM firms are reinventing their business models in various ways:

  • Traditional long-only asset managers are aggressively bulking up their private market platforms to benefit from increasing investor appetite and greater margins. 
  • Private equity firms are acquiring insurance companies and locking in permanent capital.
  • Insurance companies are monetizing their investment management skills by raising third-party money.
  • Wealth managers are expanding into employer services (think B-to-B-to-E) and other offerings.

These firms are redefining themselves through organic moves or, more often, through acquisitions. We identified this trend in our Deals Report for 2021, and we see consolidation in the industry continuing this year and beyond. Consolidation has been particularly rapid in the asset management arena, with the top 20 global asset managers accounting for about half of AUM.3 The number of firms in the industry is also shrinking. Of the top global 500 managers, 221 of the names that were featured on the Thinking Ahead Institute and Pensions & Investments 500 list in 2011 were absent in 2021. 

This consolidation is taking different shapes like bulking up product suites, bridging capability gaps and entering new segments. For wealth managers, it can mean moving from one model or wealth band to a multi-channel/multi-service model that follows the investor across their life cycle and addresses their needs, crossing traditional industry models. It also means meeting evolving investor needs by enabling new asset classes (think crypto), managing money for more than financial outcomes (like ESG) and scaling their alternatives offering.


1 "U.S. Mutual Fund and ETF Flows Reach Record," Traders Magazine, January 25, 2022, accessed via Factiva, April 12, 2022.
2 Hannah Zhang, "Active Management Fees Fell Further in 2021," Institutional Investor Magazine, February 28, 2022, accessed via Factiva, April 12, 2022.
3 “Willis Towers Watson: Top 500 managers see assets hit record $119.5 trillion,” Contify Investment News, October 18, 2021, accessed via Factiva, April 12, 2022.

In parallel, some diversified financial institutions are exiting investment management and monetizing their sub-scale businesses that require ongoing investments to remain competitive.

As large players get larger, niche managers are shoring up their expertise and client base, developing a focused and differentiated value proposition. It’s going to be tough for mid-size firms without a specific differentiator to operate efficiently in the coming years. To survive, mid-size managers will likely not only need to differentiate themselves but operate more efficiently, recognizing which capabilities to invest in and strengthen and where to utilize third-party industry specialists like fund administrators and tax specialists to handle non-core functions, “variabilize” ongoing investments and lower costs.

The time has come for managers to decide on a competitive way to play, define their vision and align their model. Being “all things to all people” isn’t likely to work. Whichever path you choose, it will mean changing certain aspects of your business. Those who haven’t yet made drastic changes to their business models will likely need to do so in order to win—or even to survive. And as they transform their businesses and enter new and potentially highly specialized areas, they will have to carefully assess and monitor the impact not only from new regulations—as regulators not only seek to monitor but in some cases prohibit certain industry practices—but also from the new risk profile that these markets create.


Key actions

  • Define how you will create and sustain a competitive business model: Identify your competitive advantages, assess market opportunities, define your ways to play and consider whether you will build, buy or borrow to acquire the needed capabilities and scale.
  • Navigate your ecosystem: As you evolve your business model and acquire (or rent) capabilities, your clients, partners and competitors will evolve as well. Mapping your ecosystem and defining how to best leverage it will be key to effectively and efficiently managing your new reality.
  • Understand and manage the trade-offs: New business models come with different risks and implications that require careful calibration and active management. 
  • Make tax part of developing your strategy: Don’t treat this as an afterthought. Address nuances in payroll, real estate, credits and incentives and their impact to your firm and funds.

2. Be Innovative: Upgrade your product suites to stay current

As your firm defines its new ways to play, it’s imperative that your products and services evolve to meet their target segment needs. You’ll also want to keep evolving investor needs and adapt your product development mechanisms to increase their responsiveness and accelerate their time-to-market.

Personalization is a key component of the investor/advisor relationship, and it remains unclear how this can be fully delivered in digital channels. Given the challenges the industry is having producing alpha and the ongoing pressure on fees, enhancing the personalization of your products and services is a good way of attracting and retaining investors.

There’s no better way to show your customers you understand them than by providing an offering that meets their needs. While easy to understand, developing true personalization requires access to end-investor data, enhanced capabilities to analyze and interpret the data and generate insights, and robust technology to provide personalization in an efficient and scalable way. This is partly driving the separately managed account (SMA) revolution we’ve been seeing recently. This “mass-personalization” is also somewhat blurring the lines between distribution and asset management. 

Wealth services providers are engaging with their end investors in different ways as well. This has changed the traditional wealth paradigm of everything aligned by the wealth bands (mass, affluent, HNW, UHNW) or channels (self-directed versus advisor-driven). Investors now look for advisors who are true fiduciaries and work in their best interests, personalize their offerings, understand their ever-more complex needs, give them a holistic, multi-channel experience and provide them with access to exclusive products. Because investors expect to be engaged with these types of services in mind, you’ll need to build much more flexible client experiences that can adapt to evolving needs and trends much faster.

Product innovation and investor needs and preferences are evolving much faster in the AWM industry. It used to take years for firms to roll out new products—even in established asset classes and investment categories. With the advent of cryptocurrencies and other digital assets, new investment vehicles are reaching the mainstream at a rapid pace.


Key actions

  • Adapt your products and services to changing investor preferences: Build much more flexible client experiences that can adapt to evolving client/investor needs and trends much faster.
  • Pay attention to ESG: ESG concerns are no longer novelties. Not only do they pose interesting opportunities and challenges for asset managers, they can create value in their own operations.
  • Stay up to date with evolving alternative assets: New types of real and digital asset classes are gaining traction with investors. Keep pace with industry and regulatory changes that may create competitive advantage.
  • Proactively manage risk: Whether you’re being exposed to new regulations or applying existing regulatory requirements to new products, you’ll need to plan for the risks presented by changes to your business and processes. Consider the establishment of a long-term change risk management function that works across major initiatives.
  • Don't forget about taxes: Tax planning is a key part of product development. As you explore new asset classes and strategies, make your tax department a part of your strategy planning.

Move from ESG theory to action

One key example of how models in the AWM sector are transforming is the growing adoption of ESG policies, investment integrations and products into their suite of investments. ESG is no longer a nice-to-have, it’s a must-have. New regulations and disclosure requirements are beginning to affect the operations of AWM firms and the companies behind the assets they manage. The SEC, for instance, recently moved closer to requiring public companies to tell shareholders and the federal government about their contributions to greenhouse gas emissions as well as how climate change might affect their businesses.

In addition to helping you adapt to changing customer preferences, ESG considerations may also offer additional margin to offset fee compression. One study showed that exchange-traded funds that explicitly focus on socially responsible investments have 43% higher fees than standard ETFs.4 Still, investment advisors and employees will need additional training and enhanced technology and data capabilities if they’re to adequately address investor questions, and that may ultimately increase costs.

There’s much asset and wealth managers have to consider when responding to the ESG movement. We outlined seven key considerations in a recent posting. No matter your approach to ESG, data is the key to reliable reporting. Asset and wealth managers must update their legacy ways of measuring performance and incorporate more ways to analyze ESG data, which is different from traditional financial metrics.


4 Wursthorn, Michael. “Tidal Wave of ESG Funds Brings Profit to Wall Street: Socially focused exchange-traded funds give asset managers higher fees in a low-fee industry,” Wall Street Journal, March 16, 2021, accessed on Factiva April 12, 2022.

The journey from real assets to digital assets 

Many firms are expanding beyond traditional opportunities and developing innovative financial products in response to changing investor preferences. In the last few years, we’ve seen firms expand beyond traditional public market instruments like equities, bonds and derivatives into private market instruments like venture capital and private equity. More recently, the private market has started including real assets like real estate, planes, ships and infrastructure in product offerings.

Now the focus is turning from the world of real assets to the digital world, as several large asset managers have been exploring the potential of offering exposure to cryptocurrencies. In response, traditional custody banks that have been trying to disrupt this space for many years are investing in their digital asset custody capabilities and fintech/cryptocurrency businesses, and they’re branching out into digital asset custody services as well. What’s more, several countries—including the US—are researching central bank digital currencies (CBDC), the digital form of a country’s fiat currency. In fact, Brazil has launched its CBDC, China is in pilot mode and India has said it plans to launch a digital currency this year. 

By expanding investment solutions offerings and distribution strategies, firms hope to tap into a growing and lucrative group of younger investors who are often risk-seeking and driven by trends. In particular, crypto assets, including cryptocurrencies—which briefly surpassed $3 trillion in value last November—are highly coveted by this new generation of investors. But it’s not just young risk-takers who are interested in crypto. A growing number of institutional investors are also considering or are already investing in cryptocurrencies.

The digitalization of economies, greater clarity on government regulations and the strengthening of digital ecosystems all are driving interest and adoption in digital assets.

Currently, no crypto-related mutual funds have been approved by the SEC. The most common ways to gain exposure to cryptocurrency vehicles apart from direct exposure is through fund of funds, private funds, some ETFs and investment trusts. The SEC’s main concerns relate to whether the underlying crypto-assets are considered securities and to the ownership, existence and valuation of the underlying crypto-assets.

Despite volatility and the scarcity of some digital assets with max token amounts, cryptocurrencies and other digital assets (including stable coins, NFTs and security tokens) appear here to stay. For the next generation of investors, crypto will be a key part of the investment ecosystem. Your ability to tap into this lucrative group of investors and become an early adopter may help you gain an advantage over larger competitors who may be slower to market.

As you begin your crypto journey…

Before launching into cryptocurrency and other emerging digital assets, there are several steps you should consider:

  • Train your workforce: A top barrier to providing innovative products is finding the right talent to operate that business. You’ll likely need a strategy for training your workforce on the differences in front- and back-office processes in addition to legal, compliance, marketing and sales. 
  • Find the right providers/partners: You’ll need providers who are flexible and able to fit your current needs as well as your longer-term goals and aspirations. You may only want certain services like custody now, but in the future you may want to explore other ways for yield generation. Also, be sure to partner with firms that can provide you an end-to-end solution, including liquidity and access to the market. This will help you meet liquidation requests from shareholders and manage data for tax reporting.
  • Secure your digital assets: Seek the best-in-class control environment for securing your own and your clients’ assets. Providers identified as best-in-class evidence deep capabilities in specific areas and stand out from their peers for their approaches and service delivery.
  • Understand the regulatory landscape: Know what laws and regulations are applicable to the products you plan to offer or the providers you use. 
  • Develop a tax strategy: A holistic tax strategy will help you create tax-efficient structures, which can be critical to your overall digital asset strategy.

In addition to helping you keep up with industry trends, integrating such complex products as crypto currencies and ESG strategies into your product offerings will give your team and organization valuable experience that can be leveraged the next time you roll out a new product.

“The strategic decisions and actions you make today will have lasting consequences. To be successful, asset and wealth managers need to understand and plan for the downstream implications of those decisions across their talent, operations, financials, risk and regulatory agenda, among other things.”

Roland Kastoun, Asset and Wealth Management Consulting Solutions Leader, PwC US

3. Be Tech and Digital Enabled: Transform through technology

As your firm transforms its business models and upgrades its product and services offering, we believe investing in data and technology and adopting a digital operating model can help accelerate your transition. These investments can help strengthen your firm’s value proposition, create better investor experience and expand reach.

Technology can also lower the entry barriers into certain geographies or segments by making distribution easier (e.g., digital outreach) and delivery cheaper. A smart digital strategy can help reconcile seemingly opposed objectives such as reducing costs while enhancing investor experience, reducing risk and shortening time-to-market.

Why aren’t you winning with digital technology?

Despite the willingness to invest in digital technologies, many firms aren’t successful in their goals because they haven’t set clear objectives. When you decide on a particular digital technology—whether it be AI, data analytics or cloud—you should first establish the goal of your investment. Are you looking for eventual product savings? To decrease time to market? Or maybe deal-servicing?

You can’t realistically invest and implement digital technologies for all of your business strategies simultaneously, so you’ll have to decide on the strategies you want to execute now and what you can implement down the road. Companies often make the mistake of trying to invest in digital technologies with multiple objectives (such as decreasing costs, increasing flexibility and optimizing the workforce) all at once. There may be many aspects of your organization that can benefit from a technology upgrade today, but be realistic—not every function can or needs to be done simultaneously.


Key actions

  • Establish the goal(s) of your digital investment: Trying to achieve multiple objectives all at once may not be advisable or doable. 
  • Evaluate the various technologies in the market: Devote time and resources to understanding AI, data analytics, cybersecurity, cloud and other digital technologies before you invest.
  • Be realistic about your technology upgrade plan: If you don’t have the capabilities in house, consider service providers who do.
  • Protect your assets: Allocate resources to cybersecurity to understand the maturity of your cyber posture and what needs to be done to address the cyber risk related to your evolving business.

Ways to play using digital technology

Platform integration: Managers with legacy systems need to become state-of-the-art and focus on allocating resources to artificial intelligence, data analytics, cybersecurity, cloud and other digital technologies. Technology upgrades can create operational efficiencies in many areas. You’ll probably find that newer technology enables you to integrate your front, middle and back offices onto one platform, making for smoother deal execution or new product launches. As the lines blur between business functions, companies with siloed teams, limited automated advice capabilities and an insufficient understanding of the broadening role of technology are likely to fall behind. 

Data: Collection and analysis of data has become a core competency and strategy in the industry. Firms that convert data into actionable items are becoming sector leaders. But to take advantage of data and outpace your competitors you’ll need to be focused and persistent, ensuring that business, data and analytics teams and technology resources are aligned on the highest potential use cases and that resources are devoted to achieve these objectives over time. Near-term benefits like efficiencies and improved outcomes, particularly in the front office, can help sustain the momentum and maintain patience for the full data transformation journey.

Realizing cloud’s value

Some AWM firms are becoming more tech-enabled by using cloud-based vendor solutions that help them accomplish several tasks like integrating new product offerings into legacy technology systems, processing and storing data and expediting time-to-market.

Whether you’re looking to migrate or modernize applications, scale operations, make data-driven decisions or secure client data, cloud can speed the process without the need for hard-to-find, expensive, skilled, in-house talent. With cloud, your firm can also leverage configurable solutions with a quicker, more agile approach to deploying capabilities. 

The future of cloud’s capabilities, powered by AI and machine learning, can help you accelerate the development and launch of new investment products and provide more personalized service for your clients and investors. Cloud could also lead to more cross-sell opportunities that elevate and improve customer experience.

Senior leaders at many AWM firms are huddling about how to best utilize cloud. In the financial services sector overall, 38% of the executives in our recent US Cloud Business Survey reported that cloud is central to their business strategy and critical to revenue growth. That compares with an average of 28% for all sectors.

Despite the strong commitment to cloud, many financial services firms in the survey indicated they’re not realizing substantial value. Asset and wealth managers may soon be searching for ways to get more value from their digital transformation.

One reason why value is difficult to gauge is because many firms still use legacy ways of measuring success, instead of new metrics that reflect the benefits that come with the shift to cloud. To win the battle for talent, for example, human resources leaders need clear, accurate insight into the people metrics that help enable the business to meet strategic goals. This type of data can illuminate critical issues, including well-being, engagement, productivity, hiring and compliance. Most cloud solutions come with embedded analytics and reporting capabilities. 

In PwC’s work with clients, we’ve seen that the full benefits of cloud can’t be achieved until change occurs across an organization in culture, operating models, talent and skills. Cloud can give you the ability to innovate faster, scale, make data-driven decisions and engage in unique partnerships. When it’s central to your overall business strategy, cloud can enhance products, services and customer experiences. Once you make the commitment to change holistically, the value of cloud will be realized in the advantages you receive over your competitors. 

Cloud migrations begin by defining which parts of the cloud you want to execute on and which parts you don’t. Firms that skip this step often fail at implementing cloud because they target too many goals at once: decreasing costs, increasing flexibility, optimizing workforce, etc. Establish a clear goal for your cloud implementation. Once you set the premise, it’s much easier to be successful.

Tax savings can fund the journey

With declining fees, AWM firm CTOs often wonder how they’ll pay for the transformation agenda. They should work with their tax professionals to take advantage of R&D tax credits intended to reward companies that pursue innovation with increasing investment. Proprietary software or other technologies you develop may help you qualify for certain tax credits as well. For example, CTOs of private equity, real estate and private credit firms who often engage in proprietary software development may qualify for the R&D credit.

4. Be Developers of Talent: Transform your people and culture

As AWM firms navigate their own transformations, they also need to address the intensified battle for talent driven by the pandemic and the subsequent Great Resignation. 

Some firms have sought to compete using traditional incentive packages that offer work location flexibility in addition to higher compensation. Others are exploring offering long-term packages that spread the compensation out over an extended period of time to disincentivize employees from leaving the company. While compensation is still important, it’s not the only driver of worker commitment. Nonfinancial benefits, including your remote work policies and your own intentions and values, are becoming a greater factor in an individual’s decision to join and stay at your firm.

The fight for specialized talent

Without the right talent, your efforts to transform or build for the future will surely fail. New technologies and current expansions into new product areas are changing the type of skills that are in demand as well as the way jobs and tasks are completed. You’ll need employees with specific skill sets and profiles to operate in this environment. You’ll also need to figure out how to incorporate and manage this new workforce. 

In short, the AWM business is changing and your success will depend on changing with it. Today’s investors have new expectations, and the technical knowledge and financial experience of your workforce must change. This has already happened with credit managers, and more recently with ESG investing, which has sent managers scrambling to hire talent to keep up with investor demand. As alternatives, quantitative investing and smart beta become more mainstream, new manager profiles will be needed. People well-versed in data and analytics will also be sought after as firms turn to the technologies to meet today’s changing AWM landscape. So instead of fighting tech-enabled realities like flexible work environments, embrace them.

The turnover rate in the finance and insurance industries has risen steadily over the last half decade, from 25.1% in 2016 to 26.3% in 2021, according to the Bureau of Labor and Statistics. 5

Winning the talent battle with DE&I and upskilling

Another reality: The AWM industry is behind the curve in diversity, equity and inclusion (DE&I). AWM firms are generally less diverse than companies in sectors like healthcare and education, and women and diverse talent often struggle to find mentors and coaches that reflect their background. What’s more, less than 1% of $70 trillion in global financial assets are managed by minority-owned or women-owned firms, while among asset management firms, percentages of ownership interests by women and people of color are “disproportionately low,” according to an SEC subcommittee report on diversity and inclusion.6


5 Table 16. “Annual total separations rates by industry and region, not seasonally adjusted,” US Bureau of Labor Statistics, March 10, 2022.
6 SEC Asset Management Advisory Committee meeting, July 7, 2021.

The dearth of transparent performance criteria is another challenge for firms looking to improve their DE&I record, as it’s not clear to women or people of color how to move up in the organization. Bolstering your DE&I efforts is a great way to attract and retain talent. Individuals from minority groups and women may face challenges and barriers to thriving within an organization. By implementing D&I best practices such as creating networking or mentorship groups, your firm may have better success attracting and retaining those workers.

Many AWM firms have also underinvested in learning and development, or multiple career paths. This is a mistake, as AWM firms should also be thinking about upskilling their current talent. As you transform, you need to ensure your workforce comes on the journey with you. Key candidates for upskilling include employees in such areas as analysis and research, which is being transformed by technology and data science, client relationship and engagement, which is being transformed due to increased digitization of distribution channels and back- and middle-office functions, some of which are being automated for efficiency.

AWM firms that are winning the battle for talent are creating diverse, inclusive, flexible and exciting workplaces with internship initiatives, careers with international programs and digital upskilling opportunities. Laggards in this space are likely to fall behind industry leaders, financial technology firms and technology companies in attracting top talent.

AWM managers will need to think of their firms as technology companies to build a culture that will resonate with today’s workers. If they don’t, they’re going to miss out on the new wave of digital talent being lured by technology companies.


Key actions

  • Build flexibility into your workforce policies: Measure employees based on the outcomes of their work versus where they work. Recognize that employees want more flexibility in how they work versus prescribed work hours/work location.
  • Don’t rush to leverage outside recruiters: It’s more important to tell a really great story as to why people should work at your firm.
  • Invest in talent: Upskilling is important, but you must also provide robust development options, stretch roles and create opportunities to grow different skill sets within the organization.
  • Double down on DE&I: Revisit culture, leadership and team behaviors, working norms and firm processes to create an environment that supports women and minorities.
  • Optimize your operations to manage scale and risk: Decide which operations to keep and which to outsource (e.g., tax, legal, valuation and financial reporting). This will help you find and develop the talent you need to drive your strategic agenda. Leverage outside organizations that offer managed services for both technology and talent that are not core to your business or difficult to scale.

Create value from your tax function

In the midst of making key strategic decisions across your organization, it’s easy to overlook a critical component of value creation: your tax function. Without a holistic tax strategy, your growth goals could be undermined. Tax problems can also severely affect a firm’s brand, making tax risk management important.

AWM industry tax services have been under particular fiscal pressure in recent years. And these are not the only challenges internal tax departments are facing:

  • Technology and the pandemic have paved the way for flexible work arrangements across the economy, and the AWM sector is no exception. Traditionally, AWM employees were confined to a handful of major financial centers such as New York, Boston and San Francisco. With more employees moving to cities like Miami, Nashville and Austin, you’ll need to address the tax issues that come with that, including some tax considerations that may be unique to a particular city or state. To help make sure your firm is prepared to expand the geographic footprint of its workforce, you’ll need a tax strategy that addresses nuances in payroll, real estate, credits and incentives, and the impact to the management company and funds.
  • With more players across the AWM industry looking to scale with new products and asset classes, a number of tax issues are bound to crop up. For example, a traditional asset manager seeking to expand into new asset classes like private credit, infrastructure or digital assets must be prepared to address complicated, perhaps unfamiliar tax regulations, as well as the structuring of funds and incentive plans, enhanced reporting and investor demands.

Optimizing your leverage model

Many firms are looking to mitigate tax and compliance risks by outsourcing tax functions to new and innovative partners. One area of your business that’s prime for outsourcing may be the middle-office tax function. The complex nature of deals and their tax structuring requires specialists to process large amounts of information in a short time period. Outsourcing tax services can help you manage the volume and complexity in certain functions, including the middle- and back-office and human resources, but you must first decide which operations it makes sense to outsource.

Handling all of these tax issues in-house is expensive; technological and human resource costs related to tax functions continue to swell, which is challenging managers that are trying to cut costs. You must figure out the optimal balance between the internal and external resources you dedicate to your tax issues. 

With that in mind, you may want to consider tax managed services. A managed services model helps companies conduct core operations like tax, finance and accounting on modern tech platforms with highly skilled professionals. Thanks to technological innovations and enhanced capabilities from third-party providers, many organizations are now exploring such an approach. PwC’s Tax Managed Services approach, for example, allows you to completely shift the burden of data gathering, reporting and compliance requirements to PwC, as we combine our functional experience and insight with the use of the latest advancements in technology, processes and tools.

Keep taxes top of mind

Given both the multi-state and global nature of many AWM firm operations, we also recommend a regular tax review to assure that the facts and law on your firm’s tax positions have not changed and that risk levels are consistent with your firm’s operational risk management perspective.


Key actions

  • Make tax part of developing your strategy—not an afterthought.
  • Address nuances in payroll, real estate, credits and incentives and the impact to the management company and funds in your tax strategy.
  • Decide on which tax operations to keep and which to outsource.
  • Sync all your tax reporting systems to reduce manual processes.
  • Schedule a regular review of your tax functions.

The path forward

Transforming your organization to adapt to an evolving business environment—intense fee pressure, rising costs and changing investor preferences—presents a valuable opportunity to spur growth, secure new customers and reposition your business to align with public perceptions. In addition, accelerating digital and workforce transformation can help boost productivity and enhance the customer experience, while driving down costs and strengthening margins.

Still, your transformation efforts will need to be managed carefully. Making a few tech upgrades here and there or doing the bare minimum on ESG won’t be enough to keep pace with the shifts in the industry and the ongoing pressures on your bottom line. In this environment, you can take several steps—regardless of your firm’s size or geography—to sharpen your focus:

  • Do some soul-searching and decide what business you want to be in, how you want to compete and the type of firm you want to be.
  • Identify your needs and what can be done internally versus externally.
  • Prioritize the areas that you need to transform first.
  • Commit to transforming with technology in the areas of data, reporting and analytics.
  • Understand that people are at the core of your strategy, and that their needs and wants from an employer are evolving.
  • Fully invest in and hold yourself accountable.

Whichever way you play, and wherever you are on your journey, these six are absolutely essential to accelerating your transformation. Now, it’s time to take charge of your agenda to “be” the firm you envision. For a deeper conversation, contact the report’s authors below.

Contact us

Seth Promisel

Seth Promisel

Asset and Wealth Management Trust Solutions Leader, PwC US

Roland  Kastoun

Roland Kastoun

Asset and Wealth Management Consulting Solutions Leader, PwC US

Andrew Thorne

Andrew Thorne

Partner, US Asset Management, PwC US

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