A third of UK asset management firms are unsure about whether they have sufficient internal resources to manage their firm’s regulatory risk, according to a new PricewaterhouseCoopers poll.

A third of UK asset management firms are unsure about
whether they have sufficient internal resources to manage their firm’s
regulatory risk, according to a new PricewaterhouseCoopers poll.

The poll revealed that despite the majority (80 per cent) of
heads of compliance working at least 11-12 hours a day, a quarter of firms feel
they are not effectively managing their regulatory risk. This is despite nearly
every firm ranking this risk in the top five that they face. This under-supply
of compliance professionals is mirrored in the external market, meaning unless
action is taken the asset management industry could be left facing a compliance
skill shortage which will continue for at least the next two to three years, the
firm said.

“Asset managers simply do not have enough sufficiently
experienced staff to cope with the increased regulatory burden. This is leaving
many firms concerned that they are not effectively managing risk despite senior
compliance staff working longer and longer hours,” said Amanda Rowland, partner
and head of asset management regulation, PwC.

“The regulatory landscape is changing and will continue to
do so at pace and for some time - it is becoming more and more demanding on
asset management firms. The compliance function is the ‘gate-keeper’ in
controlling regulatory risk and firms need to ensure they do not over-stretch
their existing compliance team. They need to think more about stripping back
their compliance operations to just the core, essential roles and streamlining
activities so that they have the capacity to cope with the work which correctly
falls within their compliance remit,” Rowland added.