Skip to content

Subscribe to Asset Servicing & Fintech Insights

Discover more information in our monthly publication, the AXIS newsletter, including industry trends, product innovation, Fintech and more from our team of experts.
SUBSCRIBE NOW
June 21, 2019
PRINT

A New Phase of Outsourcing: Transformational Times for Asset Management?

A new phase of outsourcing across managers' back, middle – and increasingly, front office functions – signals transformational times for the investment industry.

By Laurence Everitt

In this article, Laurence Everitt discusses why a new phase of outsourcing across managers' back, middle – and increasingly – front office functions – signals transformational times for the investment industry.

“It was the best of times; it was the worst of times…” While these timeless words were written 160 years ago by Charles Dickens in the novel A Tale of Two Cities, they should nonetheless strike a chord with the fund managers of today.

This is because today, in many ways, asset managers have opportunities to create the best of times. Viewed through a long-term lens, demographic trends indicate continuing high-growth potential, and access to more opportunities globally than ever before.

But they are also experiencing some of the worst of times, with shrinking margins, changing distribution models and regulatory challenges all creating significant pressures.

As the industry addresses these challenges and opportunities, asset managers are increasingly outsourcing their non-core functions – in what is effectively a ‘third wave’ of outsourcing.

Whether the coming years prove to be the best or worst of times, this trend towards greater use of  outsourcing across asset managers’ back, middle and now front office looks set to be a game-changer – heralding a new phase of transformational times for our industry.

At the same time, the potential for technology to cause disruption and create opportunity in asset management remains one of the industry’s foremost topics.

When might outsourcing become a cost- and resource-effective solution for asset managers?

Questions to ask include:

  • Is there an operational or technology component your organization does not possess – but will need in the future – that can be supported through outsourcing?
  • Might outsourcing help you optimize costs and efficiencies?
  • Could outsourcing support your regulatory compliance?
  • Is outsourcing likely to support your focus on core competencies?
  • Are there opportunity costs of not considering outsourcing?
  • What functions are central to your business model?

Download the full article to read more.

Confidentiality Notice:  This communication is confidential, may be privileged, and is meant only for the intended recipient.  If you are not the intended recipient, please notify the sender as soon as possible.  All materials contained in this presentation, including the description of Northern Trust, its systems, processes and pricing methodology, are proprietary information of Northern Trust. In consideration of acceptance of these materials, the recipient agrees that it will keep all such materials strictly confidential and that it will not, without the prior written consent of Northern Trust, distribute such materials or any part thereof to any person outside the recipient’s organization or to any individual within the recipient’s organization who is not directly involved in reviewing this presentation, unless required to do so by applicable law.  If the recipient is a consultant acting on behalf of a third party client, the recipient may share such materials with its client if it includes a copy of these restrictions with such materials.  In such event, the client agrees to comply with these restrictions in consideration of its accepting such materials.

© 2021 Northern Trust Corporation. Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A. Incorporated with limited liability as an Illinois corporation under number 0014019. Products and services provided by subsidiaries of Northern Trust Corporation may vary in different markets and are offered in accordance with local regulation. This material is directed to professional clients only and is not intended for retail clients. For Asia-Pacific markets, it is directed to expert, institutional, professional and wholesale clients or investors only and should not be relied upon by retail clients or investors. For legal and regulatory information about our offices and legal entities, visit northerntrust.com/disclosures. The following information is provided to comply with local disclosure requirements: The Northern Trust Company, London Branch, Northern Trust Global Investments Limited, Northern Trust Securities LLP and Northern Trust Investor Services Limited, 50 Bank Street, London E14 5NT. Northern Trust Global Services SE, 10 rue du Château d’Eau, L-3364 Leudelange, Grand-Duché de Luxembourg, incorporated with limited liability in Luxembourg at the RCS under number B232281; Northern Trust Global Services SE UK Branch, 50 Bank Street, London E14 5NT; Northern Trust Global Services SE Sweden Bankfilial, Ingmar Bergmans gata 4, 1st Floor, 114 34 Stockholm, Sweden; Northern Trust Global Services SE Netherlands Branch, Viñoly 7th floor, Claude Debussylaan 18 A, 1082 MD Amsterdam; Northern Trust Global Services SE Abu Dhabi Branch, registration Number 000000519 licenced by ADGM under FSRA # 160018; Northern Trust Global Services SE Norway Branch, 3rd Floor, Haakon VII's Gate 6, 0161 Oslo, Norway; Northern Trust Global Services SE, Leudelange, Luxembourg, Zweigniederlassung Basel is a branch of Northern Trust Global Services SE (itself authorised by the ECB and subject to the prudential supervision of the ECB and the CSSF). The Branch has its registered office at Aeschenplatz 6, 4052, Basel, Switzerland, and is authorised and regulated by the Swiss Financial Market Supervisory Authority FINMA. The Northern Trust Company Saudi Arabia, PO Box 7508, Level 20, Kingdom Tower, Al Urubah Road, Olaya District, Riyadh, Kingdom of Saudi Arabia 11214-9597, a Saudi Joint Stock Company – Capital 52 million SAR. Regulated and Authorised by the Capital Market Authority License # 12163-26 CR 1010366439. Northern Trust (Guernsey) Limited (2651)/Northern Trust Fiduciary Services (Guernsey) Limited (29806)/Northern Trust International Fund Administration Services (Guernsey) Limited (15532) Registered Office: Trafalgar Court, Les Banques, St Peter Port, Guernsey GY1 3DA. Northern Trust International Fund Administration Services (Ireland) Limited (160579) / Northern Trust Fiduciary Services (Ireland) Limited (161386),  Registered Office: Georges Court, 54-62 Townsend Street, Dublin 2, D02 R156, Ireland.