2023 Trend: Regulatory Demands Direct Operations Teams’ Focus

Chanelle Crabtree

Consulting Principal – Investment Operations and Outsourcing

Chanelle Crabtree has extensive experience consulting for the asset management industry in Australia for the past 20 years. Chanelle has considerable knowledge and expertise in investment management, outsourcing, and the development of operational models that support the investment management lifecycle. Chanelle leads Cutter Associates’ Investment Operations and Outsourcing practice, and oversees Cutter’s Australia office. She has decades of experience working for investment management firms, custodians, and consulting firms, in roles that included middle-/back-office operational, business analyst, project management, consulting, and senior management. She has a deep understanding of investment management, covering the operational, governance, and system requirements to support all types of clients, products, and asset classes.

A former Director at Deloitte, Chanelle led key engagements, particularly for complex clients with diverse asset classes, covering target operating model design, sourcing, and implementation. Prior to Deloitte, Chanelle was a Lead Consultant at Morse Consulting Pty Limited, where she led various engagements that covered target operating model design, sourcing of custodians/systems, and implementations with investment managers and superannuation clients.

Laura Jesson

Senior Research Analyst

Laura Jesson has more than 25 years of experience in the financial services industry as a project manager, business analyst, and consultant. She joined Cutter Associates in 2013. Prior to Cutter, Laura spent eight years at Wells Capital Management and Evergreen Investments, where she managed investment operations projects, including those focused on outsourcing, client reporting, and trade management. She previously worked at Omgeo as a member of the Central Trade Manager (CTM) product design team. Laura started her career at Andersen Consulting (now Accenture) as a process consultant supporting a variety of projects for clients in the financial services industry. Laura earned her bachelor of arts in economics and psychology from Amherst College. She holds the Project Manager Professional (PMP) certification.

Recent research assignments and publications include the following:

AI Use Cases in Investment Management: Infinite Possibilities 
Business Intelligence Tools
Cutter Benchmarking: Client Reporting
Cutter Benchmarking: Firmwide ESG Capabilities
Cutter Benchmarking: Managing Vendors and Service Providers 
DataOps: In Theory and Practice
Enabling Data Analytics
ESG Data Management 
ESG: It’s a Jungle Out There ─ A Look at the Data Provider Landscape
ESG Investing: One Vision, Many Lenses 
Execution Management Systems
Hybrid Work Arrangements and Their Impact on Firm Culture
Using RPA to Automate Business Processes
The Role of the CRM for Asset Managers

Mar 27, 2023

The following blog post is one in a series of Cutter 2023 Trends that provide insights into industry challenges and considerations for our clients and member firms in 2023 and beyond.

We started 2022 hopeful that operations teams would enjoy the benefits of expanding budgets by tackling overdue wish list and process efficiency initiatives. Unfortunately, with today’s volatile market conditions, inflation, staff shortages, and competing pressures in the front office, many firms have dialed back those hopes.

While some operations teams may continue to make improvements in key areas such as cash management and corporate actions, most teams now focus their energy on their mandatory regulatory-driven initiatives. In addition to regulatory reporting pressures, especially those unfolding for ESG, firms face several other critical regulatory pressures. Asset managers continue to work on their uncleared OTC derivatives and collateral handling to comply with the Uncleared Margin Rule (UMR), enacted in response to the financial crisis of 2008 but now in the final phases and impacting more firms.

Cutter members also remain focused on squaring up the matching and settlement processes. The Central Securities Depository Regulation (CSDR) settlement rules, although still with pending deadlines, have spurred continued emphasis to better manage fails and support shorter settlement cycles. With greater scrutiny of alternative investments and valuations expected, such as those outlined by the Alternative Investment Fund Managers Directive (AIFMD), operations teams have also mobilized their alternatives administration support process improvements.

We know this is not new territory, as operations teams have long balanced their investments in human capital, technology solutions, and service options with their strategic plans to meet upcoming regulations. Nevertheless, we see regulatory pressures and their impact on operations as a significant trend for 2023 and beyond.

To speak with a Cutter analyst or consultant about this trend, contact us at [email protected]. To read more 2023 Trends, see our whitepaper, Trends in Asset Management: 2023 and Beyond.