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Survey reveals the future of the funds industry

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A poll of attendees at the Guernsey Funds Forum 2013 has provided valuable insight into the future of the funds industry, writes Fiona Le Poidevin, Chief Executive of Guernsey Finance – the promotional agency for the Island’s finance industry.

The future landscape of the investment funds industry will be affected by ‘external factors’ just as much as regulation, according to an exit poll of the 400-plus delegates attending last week’s Guernsey Funds Forum 2013 held in London.

The half-day conference and exhibition, titled ‘Back to the Future’, included two panel sessions – one on investor relationships and another on the effects of regulation – and a keynote debate featuring industry experts Nigel Vooght, PwC’s Global Financial Services Leader and head of its future-focused initiative ‘Project Blue’; and Better Capital Founder and Chairman Jon Moulton. The event was moderated for the fourth consecutive year by Senior ITV News Anchor, Alastair Stewart.

Using interactive voting for the first time, the Forum opened by asking delegates whether they thought the future of the investment funds landscape would be impacted more by investor influence, regulation or external factors, such as new technology, demographics, social change, the rise of state-directed capitalism and mounting pressure on the world’s natural resources.

The greatest proportion of delegates chose regulation, with external factors in second, closely followed by investor influence. However, after several hours of debate, the post-event exit poll revealed that while there had been an increased proportion of delegates believing regulation would be the most significant factor impacting the future landscape of the investment funds industry, this was now matched by those voting for external factors, with investor influence a distant third.

Fiona Le Poidevin, Chief Executive of Guernsey Finance – the promotional agency for the Island’s finance industry, said: “When we are pre-occupied with the demands of the day job, it is sometimes too easy to lose sight of the big picture. The Forum was about encouraging members of the asset management industry to take a critical look at their long-term strategies whilst remembering that these are heavily influenced not just by the immediate impacts of current regulation or changing investor demands but also that they will need to be flexible enough to cope with the changing external landscape. Macro factors such as new technology, demographics, social change and the war for natural resources will also impact the global funds industry in a significant way in the years to come and we need to be ready for that.”

Eric Warner, Partner and Head of Investor Relations at Altius Associates; Darren Winder, Head of Economics and Strategy at Oriel Securities; John Daghlian, Partner at O’Melveny & Myers; and Adam Turtle, Partner at Rede Partners, made up the first panel session, ‘Investor relations and influence’.

The event’s second panel debate, ‘Regulation – the bigger picture’, comprised Tim Hames, Director General at the British Private Equity & Venture Capital Association (BVCA); Carl Rosumek, Director of Investment Business at the Guernsey Financial Services Commission (GFSC); Nigel Farr, Partner at Herbert Smith Freehills; and Brian Forrester, Partner in the Investment Management and Private Equity Group of Deloitte’s London office.

Among the delegates was Stephen Foster, Chief Operating Officer for Alternative Investments UK at Credit Suisse Asset Management, and Sandford Henry, Director of Asset Solutions. Mr Foster said the event had been interesting and informative.

“It’s a great format and having Alastair Stewart there as a professional moderator really takes it a step above a lot of the conferences. He is well informed on the topics and brings out the best in the speakers. One of the things that struck me was a reminder that Guernsey is very flexible in terms of embracing new ideas, new regulation and has been very proactive in terms of AIFMD and what they propose to do in terms of this dual regime, whether you want to be in the AIFMD or outside,” said Mr Foster.

Mr Henry commented: “I think this is a huge opportunity for Guernsey. All these regulations that are coming in from Brussels are reprehensible in the sense of the cost they are going to pass on to the fund managers. The costs that are going to be passed on to the fund managers are going to be huge and they are going to keep coming. I am worried about it but Guernsey opens a huge opportunity and couldn’t be better represented than by John Moulton who really understands the investment business.”

Victoria Younghusband, Partner at SJ Berwin LLP, was also impressed with the event.

She said: “I came here because my firm uses Guernsey quite frequently as a jurisdiction for establishing funds and it’s always good to meet with people from Guernsey and hear the latest from Guernsey regulators and other service providers. It was very interesting looking forward 10 and 20 years in the light of the tsunami of regulation that is coming forth today and discussing the challenges of AIFMD.”

As well as the conference, there was also an exhibition of Guernsey service providers, including the Island’s leading fund administrators, custodians, multi-jurisdictional legal practices and global accountancy firms.

Miss Le Poidevin added: “We have been incredibly pleased with the turnout and feedback already received about the event. Having such an experienced moderator as Alastair Stewart meant that he was able to get straight to the important issues and he really embraced the theme of the day.”

Hosted by Guernsey Finance in conjunction with the Guernsey Investment Fund Association (GIFA), the Guernsey Funds Forum 2013 was held on Thursday 2 May and supported this year by the BVCA, Global Custodian, HFM Week, Limited Partner Magazine and unquote”.

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