Global Alternatives Summit: Aligning for the Future
Successfully adapting to the rapidly changing global alternatives marketplace will require ongoing, close collaboration between funds and service providers, said MUFG Investor Services’ CEO John Sergides, as he opened the firm’s inaugural Global Alternatives Summit in Miami.
“We’re here to form new relationships and to renew old ones,” John said, welcoming more than 100 clients, colleagues and industry stakeholders to the Summit. “We need to sit down and talk about the things that matter, so we understand better where your future lies and where our future lies. Right now, we are aligned, but we need to make sure that we remain aligned.”
Looking back over the past decade, John traced the organic growth of MUFG Investor Services, as the firm approaches the trillion-dollar mark in assets under administration. John cited the 30% rate of growth during the last six years, far above the industry’s average of less than 5%, and he noted the firm has significantly expanded beyond fund administration and asset management to include FX, banking, business consulting, and a host of other services.
“We’re no longer the partner that we used to be, but we’ve become the partner that people needed us to be,” John said. “The metric I’m most proud of is the fact that we don’t lose clients. We grow by word-of-mouth. We grow through selective marketing and we grow sustainably. That tells the best story.”
At the same time, the firm continues to invest in hiring and retaining top talent. “Our people drive our business, and we pride ourselves in having the best people out there,” he said.
Noting the “symbiotic relationship” between fund managers, providers and vendors, he identified cybersecurity, managing costs and mitigating risks as the biggest threats facing the industry in the future.
“When firms suffer a cybersecurity event, it can be really damaging to their future and their trajectory,” John said. As costs increase, including salaries and incentives as well as vendor charges, the industry must determine who will bear those costs. And firms must effectively manage risk and understand “where does risk lie within our organization, your organization, and the general marketplace,” John said. “Where is this risk being transferred to? Is it the right place for this risk to sit and how is it being managed?”
By examining the “commonality between our clients and partners,” John said providers will better understand how they can invest to help fund managers remove “asymmetrical risk problems, where perhaps they’re not adding value and we can do better in a way that adds value to them and to their investors.” The Summit’s goal was to provide an opportunity to look to the future and “come away with a common direction and theme,” John said. “It’s unlikely we’re going to come to some dramatic answers and conclusions in the next day or so, but it gives us room to think and understand what we discussed. These are long-term problems and we have to start looking at solutions.”