12-05-2025
Why deregulation does not always mean lower compliance costs
This level of regulatory complexity not only drives up the cost and complexity of day-to-day compliance, but it also underscores the risk of non-compliance, reputational damage, and regulatory scrutiny.
Heightened compliance as the prudent choice
At a time of intensifying regulatory and policy change, many businesses are dedicating more, not less, resources to monitoring, reporting, and ensuring that they meet and understand the demands associated with operating in each jurisdiction.
For the asset management sector, regulatory change remains top of mind particularly given the central role that reputational risk and investor trust play in its business model. In an industry where credibility and transparency are critical to client retention and capital flows, even minor compliance missteps can have outsized consequences, despite enforcement activity typically being more heavily concentrated on the sell-side.
The findings from the discussion support the results of Coalition Greenwich's 2024 Global Buy-Side Compliance and Surveillance Study, which was conducted in partnership with Bloomberg, and point to the longevity of many of these issues.
The survey found that:
There is a clear priority across titles and functions: Strong compliance as a competitive advantage.
Compliance officers are cautiously optimistic about their future budgets to help achieve this. Spending is expected to increase in this area globally, regardless of geopolitical shifts, with funds allocated to prevent regulatory fines and invest in technology and front-office tools.
It's going to be all about the data. The growth of data in the last few years, due to the expansion of data sources, is forcing compliance professionals to rethink their strategies. Consolidating existing surveillance systems and vendors and integrating capabilities is an important near-term goal, and achievable for buy-side firms.
Innovation in compliance technology, fueled by advances in AI and automation, is helping firms elevate their compliance capabilities and respond more effectively to regulatory demands.
In a world of accelerating regulatory change and rising expectations, global firms must remain agile in order to adapt and comply at pace.
As individual regional markets look to reduce the regulatory burden, the demand for skilled compliance professionals who can leverage compliance technologies is set to rise. As firms navigate an increasingly fragmented landscape, this combination of technological capability and human judgment will be more critical than ever.
