Asset management in SA on cusp of an overhaul

Adriaan Kruger

“Changing needs of investors, far-reaching advances in technology and major regulatory changes are set to have a major effect on the SA asset management industry,” says Jo-Anne Bailey at Franklin Templeton Investments.

The regulatory changes include greater transparency and reporting requirements on the part of asset management firms, new and stricter fiduciary standards and increased disclosures to investors. Strategic and operational risks are increasing, which results in more onerous demands in regulatory and compliance-related issues.

“The industry continues to face fee compression, which is a strong driver in favour of passive and smart beta products.”

sophisticated technology that doesn’t just assure investors of safe, convenient access to accounts at the front end, but includes products using advanced digital algorithms to reduce risk and enhance returns.

Technology advances present new operational risks for asset managers. “They also have to protect clients’ information,” says Bailey, who believes SA’s investment industry is “strong, healthy and growing”.