Funds Europe – Let’s talk more about the role of technology in this.
Coughlan – Embracing technology and challenging how processes are preformed currently is imperative. The likely increased focus on AML and CFT will mean that the use of automation within these processes is becoming more important. Obtaining satisfactory customer due diligence (CDD) is a challenge within the funds industry, particularly as the number of investors per fund continues to increase. The requirement for wet-ink documents is a challenge, so embracing technology to assist in identification and verification processes is a must.
Generally, I believe that when we consider the use of technology, we need a clear roadmap to avoid a situation where you end up with multiple independent systems not connected therefore not working efficiently. A material commitment to automation is required within the industry.
We have challenges with resourcing at certain levels in Jersey. Automation can play a significant part in assisting us with managing that challenge and allowing us to focus our professional, knowledgeable and experienced people on real value-add tasks as well as lead our client relationships proactively.
Haithwaite – Technology plays a huge part in times of turmoil, not only in reducing margins but enabling business to carry on as usual.
Lockdown has been a challenge, but jurisdictions like Jersey that adapted have fared well. In Jersey, the authorities adopted fully electronic filing, implemented flexibility to comply with substance requirements and amended legislation in areas like electronic powers of attorney and certification requirements. As a result, we’ve seen significant funds launched through Jersey during lockdown.
Burgess – Technology can help with margin pressure by making operating models more efficient. But deploying good technology costs money, which must be recouped. To recoup it, you need enough clients to spread the cost. That’s driving the size of individual funds and fund managers – and fund administrators. The size of individual fund services businesses has grown substantially, and we’re likely to see further consolidation in the market.
Direct investment platforms are an interesting development. Over the last ten years in Jersey, we’ve seen an increase in direct investment platforms for the kinds of investors – pension funds, sovereign wealth funds – that want direct control of the underlying asset. Jersey’s fantastic at that type of work.
Macleod – With a focus on margin, GPs are definitely turning towards technology and many rely on their service provider to provide scalability rather than having to make all of the investment themselves. Off the back of this, we are seeing real demand for sophisticated technology solutions that cater to real-time data reporting and analysis. But Jersey will not be alone in offering these types of technological solutions, particularly where such solutions are being rolled out globally across multiple jurisdictions by well-integrated fund administration groups. So, although the tech side is vital, Jersey must not lose sight of the many other factors we have discussed that differentiate it from other jurisdictions, not least the reputation it has for high service levels. Technology will undoubtedly create efficiency and create the opportunity for better margins, but GPs will want to ensure that they select a jurisdiction where an increased margin does not come at the expense of service quality and I think that’s why Jersey will continue to thrive.