Fund managers across the alternative asset class cite cybersecurity and ESG as top challenges during the fundraising due diligence process, according to a recent survey by Crestbridge.
The survey revealed that compliance and regulatory support are a concern for almost half (46.15%) of respondents.
Evolving global regulations and compliance standards pose a challenge for fund managers, particularly “smaller firms or those who have not yet scaled” without resources to dedicate to regulatory compliance, said Cheryl Bai, head of funds for Crestbridge.
The survey also revealed that sourcing and retaining talent remain the biggest internal challenges for managers to run their funds, with over a third expecting this to be an issue throughout 2023.
While the Great Resignation started in 2021, managers anticipate the issue to affect not just the asset classes but also the broader financial services industry and other industries, with no specific jurisdiction being spared.
The survey also found that managers are grappling with operational efficiency, managing data for both the business and investors and keeping up with technological innovation and regulation.
Regarding domiciles, Luxembourg (57.14%) was voted as the most attractive jurisdiction for managers in 2023, followed by Delaware (35.71%).
Managers also showed an interest in the Channel of Islands, Cayman Islands, Singapore, Ireland, and the UK as domiciles for alternative funds.
The survey highlighted that fund managers face various challenges that require them to navigate a complex and ever-changing landscape to ensure success.
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