AM compliance budgets hit peak

AM compliance budgets hit peak

Changing business models, regulatory scrutiny and cost cutting are impacting the hiring habits of asset management firms, according to PwC’s 2016 survey of global chief compliance officers (CCOs).

Asset managers are further centralising their global compliance functions in order to bring consistency and efficiency on the back of increasing pressure from both local and global regulators.

66% of survey respondents said staff retention is a problem and will continue to drive up the cost of hiring compliance staff.

The sector has seen increasing compliance budgets since the financial crisis but half of the CCOs interviewed said their budget has reached a peak, reflecting cost pressures in the industry.

Such stalling in budget means that compliance functions are re-evaluating the skillset they need, as regulators deal with MiFID II and contingency planning for Brexit. 

As a result, one third of the CCOs surveyed by PwC say they are hiring compliance staff from the sell-side, who they feel are better able to challenge and oversee the necessary changes in the business.

“We continue to see global compliance functions evolve in response to ever increasing regulatory demands,” said Amanda Rowland, asset management regulation partner at PwC.

“These demands, coupled with the current cost pressure in the sector mean we are likely to see ever greater focus on strategic and innovative change to the way global compliance functions operate in the future.”




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