Saving money is a key priority when pension funds, insurers and corporates are assessing technology platforms in the New Year, according to a new report from Clearwater Analytics.
The research, which polled institutional asset owners representing $10 trillion in assets under management (AUM), was geared at getting a better understanding of how investors view their investment technology platforms, and where their budget priorities are focused for 2023.
It found that cost control through improved operational efficiency is a main budget concern fot 80% while 60% highlight outright cost as top of their focus list for next year.
Front-office client support sat at the bottom of the agenda, with the middle and back offices gaining importance for those surveyed.
In terms of where budgets will be allocated in 2023, risk analytics, performance and attribution, reporting and portfolio management systems were the most frequently mentioned areas.
The report suggests that this is due to respondents’ ‘lacklustre feelings’ towards their current investment stacks.
Unsurprisingly, the research found cloud-based investment technology was widespread and continues to grow.
For 40%, cloud technology comprises 75% or more of their tech stack while only 14% of institutional investors use cloud platforms “very little.” the report said.
Looking farther ahead to three years, reporting and portfolio management were considered the areas that will receive the most funding.
“Our research has found that investors want technology to help improve their efficiency, attract and retain employees in the face of ‘The Great Resignation’, and ultimately increase bottom-line profitability,” says Gayatri Raman, president for Europe and Asia at Clearwater.
She adds, “They also want to get to their solution faster and control cost. These are all advantages of cloud-based technology, the top choice for the investors we polled.”
