Survey of investment adviser firms’ compliance officers finds that business continuity is now top of mind

Published: Wednesday, 22 July 2020 09:44

Business continuity planning related to COVID-19 is now the top concern of investment management compliance professionals – edging out cyber security, which had headed their rankings of hot topics for six consecutive years.

Compliance officers from 384 investment adviser firms participated in the 2020 Investment Management Compliance Testing Survey, an annual survey now in its 15th year. The 2020 survey was cosponsored by the Investment Adviser Association (IAA), ACA Compliance Group and Brightsphere Investment Group. The survey ran from April 20th through to May 31st.

While nearly two thirds (64 percent) of respondents cited COVID-19-related business continuity planning as the hottest compliance topic, an overwhelming 88 percent reported that COVID-19 had caused no material impact to their firm. Fully 81 percent of responding firms reported that all of their employees were working from home.

“The impact of COVID-19 on investment advisers’ ability to maintain business continuity and to continue to abide by their fiduciary duty can be seen as a litmus test which it appears the industry has passed,” said Enrique Alvarez, Senior Principal Consultant at ACA Compliance Group. “This is a great case study that demonstrates that thoughtful and careful consideration of policies regardless of topic can lead advisers down a safe path even if that path was unexpected and volatile.”

Completing the top five compliance hot topics identified by respondents were: cyber security (57 percent); advertising/marketing (25 percent); conflicts of interest (21 percent); and ESG/sustainability (14 percent).

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