Both the SEC and the Financial Stability Oversight Council have indicated their intent to extend regulatory reporting requirements within the asset management industry. These announcements follow a clear focus from regulators to make financial services firms — from banks to hedge funds to now traditional asset managers — to make the collection, analysis and reporting of data central to their operations.
BCBS 239, Dodd-Frank and Basel III all dictate some form of data governance that enables a higher level of transparency to the regulators about the risks being managed, and require reports based on ever more granular levels of detail. And if clients know that this information is being provided to the regulators, you can bet that they will expect and demand more in a parallel response. So what’s an asset management firm to do in preparation for these new regulations, and the further requirements that inevitably will follow?