A survey underway by Intertrust Group and Global Custodian has so far revealed that over the next few years, chief financial officers (CFOs) expect their limited partner (LP) clients to require data updates with increasing frequency. In particular, just under 40% of respondents expect their investors to be looking for access to live updates on portfolio performance and 30% on cyber-security.
At the same time, 40% of participants are expecting a need for daily updates on operational SLAs and 35% on environmental, social and governance (ESG) – updates that private capital funds will not necessarily be in a position to provide without further investment in functionality and resources.
CFOs themselves see portfolio performance, operations and cyber-security as areas where their own attention is most likely to be drawn, while ESG and diversity and inclusion are expected to occupy less of their own attention.
Asked to select up to three areas that they anticipate will have the biggest draw on available resources at the fund, portfolio performance and cyber-security again top the tables (see Fig. 1).
With the competing challenges of addressing the expected client push for more frequent data updates and the resourcing needs resulting from fund growth, CFOs are faced with several alternatives, including outsourcing, buying in more technology or beefing up the CFO team. As the year draws to a close, private capital fund CFOs also have more short-term considerations. As one survey participant notes, “Getting over the Covid crisis is the most important challenge right now.”
Responses so far have come from private capital fund CFOs or their immediate reports in USA (39%), UK (29%) and China (25%). Assets under management of respondents raged from less than US$1 billion (38%) to more than $50 billion (7%). Funds covered private equity (37%), private debt (20%), infrastructure (24%) and real estate (16%).
The survey, launched in late Q4, will be running until mid-January. Readers from private capital funds who wish to take part my do so here.