Remote-working models are giving rise to new risk challenges for capital market firms in Australia, while regulators are shifting their attention to areas such as surveillance and fraud.
Even as firms start to renew their focus on growth, they recognize that deeper investments in RegTech and risk management will be mission critical.
The changing risk landscape is demanding more external support, with more than half (55%) looking to their tech vendors to strengthen their risk management capabilities.
The latest Readiness Survey by FIS™ launched in Australia is the only report of its kind focused on the entire capital markets industry and explores how firms are transforming their technology and operations to compete in the future.
Key stats from the latest Readiness Survey by FIS™
Logistical and security issues related to remote working (37%) were identified to be one of the biggest operational and technology challenges for Australian capital market firms, alongside new demands on risk management (32%) and cyber and fraud risks (30%).
To maintain or improve competitiveness, 43% of firms surveyed plan to strengthen cyber and fraud risk defences by investing in RegTech solutions, ahead of the global average of 37%.
63% of firms will focus their regulatory and compliance investment on enhancing risk-management capabilities. Buy-side firms showed the greatest appetite, with 70% planning to invest in risk management in the next 12 months.
55% of firms said tech vendors can add greater value in helping to strengthen risk management, compared to the global average of 39%.
Commentary on the Readiness Survey by FIS™
“Covid-19 brought a shift in future of work trends. With vaccination underway, some of the workforce will return to the office, however many will likely remain at home.”
“Changes in working culture are expected to be permanent, and this has many repercussions on capital market firms. The rise of a remote workplace is shining a spotlight on logistical and security challenges, as indicated by 37% of firms surveyed in our Readiness research.”
“Intensifying cyber and fraud risks and new demands on risk management are also presenting some of the biggest short-term operational and technology challenges for firms.”
“Australian firms are starting to take action to respond to the changing risk landscape. 43% of firms view investments in RegTech solutions to strengthen cyber and fraud risk defenses as a competitive advantage, ahead of the global average of 37%.”
“There is a surge in demand for robust RegTech and surveillance tools across operations.”
“As risk management takes center stage, Australian capital market firms are acting fast to answer the call and up their investments in their risk capabilities to cement their position as global leaders,” says Ashish Rai, MD, APAC and MEA, Capital Markets at FIS.