Keeping a lid on rising costs is the top priority for asset managers, according to an industry survey sponsored by Northern Trust.
The survey of 300 global asset management firms, which was carried out by WBR Insights in the first quarter of 2020, found that controlling costs was the top priority for 87% of respondents over the next two years.
However, concern about costs was closely followed by risk, compliance and resilience (86%) and tapping into new markets (85%) as key priorities for firms over the next couple of years.
“Containing costs while entering new markets is challenging, particularly when facing the confluence of existing margin pressures and a contracting market,” the report noted.
“To do this, asset managers of all sizes must be nimble and flexible and have operating models that are scalable, efficient and tech-enabled,” the report said.
To that end, the survey also found that firms are looking to outsourcing and technology to help meet their goals.
For instance, Norther Trust reported that 85% of respondents have outsourced their trading desk or are considering doing so.
Almost half (45%) of respondents said that they are considering outsourcing data management in the next two years.
Additionally, almost two thirds of respondents (64%) said they plan to utilize technology to achieve their strategic goals.
“However, investing in next generation technology such as AI, machine learning and cloud-based data management solutions comes with a cost that can be prohibitive when firms are seeking to control expenses,” Northern Trust said.