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Five reasons why an annual service review with your fund administrator makes sense

Five reasons why an annual service review with your fund administrator makes sense

18 July, 2023
Funds Fund Administration

All too often, fund managers hold off switching their fund administrator until the pain of staying with their current provider exceeds the perceived pain of leaving. 

Typically, this point is reached when poor service begins to impact investors. By then, sub-optimal fund administration is already negatively affecting your business. 

By conducting an annual review with your third-party fund administrator, you can strengthen the partnership with them. Ocorian proactively engages with our clients for regular assessment of our services, to ensure not only consistency of quality and timeliness, but also to continuously supporting our clients’ growth and ambition by aligning our product development roadmap to their emerging needs. 

Ocorian recommends a regular, in-depth fund administrator review for the following five reasons: 

1.  Your first duty is to your investors 

Reviews ensure you are fulfilling your fiduciary responsibility to provide investors with the best value possible. As your investors will often be institutions with their own fiduciary responsibilities, this helps you to serve them.

2.  The person who appointed your fund administrator may not work directly with them 

Reviews facilitate internal communication among teams about satisfaction levels with your current provider. 

3.  Knowledge is power 

Reviews allow you to identify any areas where your service provider is not meeting your expectations and address those issues with them. If it is unable or unwilling to meet your demands, that is a red flag that it may be time to switch. 

4.  The market changes frequently

Reviews allow you to assemble an up-to-date picture of your current position . The best choice today for you and for your investors today may be different from when you originally selected your provider as your requirements evolve.

5.  Regular reviews are your insurance policy 

Reviews keep your provider on its toes, reducing the likelihood of error. They also give you the comfort of knowing you have done everything you could to ensure best practice should an error occur.

Paul Spendiff, Head of Business Development, Fund Services at Ocorian says:

“I would strongly recommend that an asset manager sit down and review their fund service levels annually. Too often, we see fund service provider changes because of market events, such as M&A activity or because of a long breakdown in service and communication between the parties. It does not make sense to wait for a breakdown with your provider before you consider your options. Some people are reluctant to admit that they have chosen the wrong provider or that they have managed the relationship poorly or held them to their SLAs. 

As a regulated entity, asset managers have a fiduciary responsibility to their investors to ensure they are getting the best possible service. And the best possible thing you can do for your investors is to regularly review your provider. Even if it does mean deciding to stay with your current provider because you have assessed the options and are happy with your current setup. Finally, it never hurts to see what else is available.”

Looking to switch fund service providers?

Ocorian has over 30 years of experience in delivering operational excellence across our fund administration, AIFM, accounting and depositary services to the world’s largest institutions along with dynamic start-up fund managers and boutique houses.

We have a strong track record of successful migrations from other fund service providers. In 2022 alone, our onboarding and solutions team successfully completed over 40 migrations from our competitors.

Find out why fund managers are switching their fund administrator to Ocorian. To arrange a call to discuss your requirements, please contact our Fund Services Business Development Team

Download our free guide: A complete guide to switching your fund administrator

Next up: Learn more about the four crucial areas to consider when reviewing your fund administrator.