PALM DESERT, Calif. - If you’re outsourcing record-keeping around the world, you still have to oversee it, for compliance purposes, experts and asset managers say.
Be careful in what you decide to outsource, according to Alan Fish, a partner for the asset management industry in the Americas for Ernst & Young.
Be careful about what operations you outsource – and what service provider you choose, said Fish at the Investment Company Institute’s annual Mutual Funds and Investment Management Conference here.
Because, in the end, your compliance organization will need to get involved, he said.
The compliance office will need to be involved in the selection of any vendor, the service level agreements reached and what books should be kept by the vendor and in what region or regions of the world, he said.
“Data is huge,’’ he said. And affects every asset manager’s operations in every part of the world.
BlackRock, now the largest money manager in the world, has been moving a lot of processes around the globe as it has moved from $90 billion in assets it oversaw a decade ago to $900 billion now, according to Charles C. S. Park, managing director and chief compliance officer for BlackRock Fund Advisors.
The key is to determine where the records are going to be kept and how record-keeping will be supervised, by your own personnel. “You have to evaluate where you’re comfortable,’’ Park said.
A big part of the challenge is the actual management of the data: Making sure it’s available, that it’s reliable and that it’s timely. “There’s a real tension there,’’ Park said.
It takes time, for instance, to validate data and scrub it, to make sure it’s clean.
And it’s even harder, Fish said, to try and achieve a single “golden copy” of data, for a company that operates worldwide.
So far, Fish said, he hasn’t “seen anybody really able to achieve that.’’