Why technology is the future for trust investment monitoring

Future of trust reporting

Technology is vital for trustees looking to thrive in the modern world. Automating data management processes and autonomous investment monitoring doesn’t just help to save resources, it also gives trustees the opportunity to focus on delivering a better overall client experience, to enable business growth.

Trustees already use a variety of software to help them, including trust administration software, accounting systems, amongst others. But when it comes to data management and investment monitoring, many still rely on reports from investment consultants and the associated manual data consolidation and client reporting processes. Here are some of the key reasons trustees are turning to technology to help them with investment monitoring.

Portfolio data consolidation and automated bookkeeping

Trust portfolio data sourced from a number of investment managers, spreadsheets, statements and systems inevitably has dozens of file formats and variations in the content. Dealing with these manually can be a huge time sink. However, technology is now able to automatically transform this disparate information into a single standardised schema, which can be processed systematically for downstream monitoring and reporting.

Eliminating the manual process of consolidating and reconciling data enables trustees to streamline their internal data management and investment monitoring workflows, reducing operational risk, improving bookkeeping integrity and freeing up time for higher-value interactions with clients.

If these data inefficiencies are not solved, it has a direct impact on margins and recoverability – and mean that dependent processes cannot be scaled. A reliance on mundane, repetitive tasks may also fuel staff turnover and key person risk, damaging morale and heightening the danger that knowledge of mission-critical manual processes will be lost.

Trust investment portfolios increasingly include alternative investments such as private equity, real estate and direct investments. The latest technology includes functionality that enables trustees to seamlessly update transaction and valuation data for any private assets, in dashboards that automatically consolidate this data with any publicly listed assets.

Taking command of investment monitoring

Another key driver of trustees turning to technology is the need to have ready access to up-to-date portfolio performance data for effective investment monitoring. Most trustees receive quarterly reports on performance from their investment managers, but with volatile markets and an uncertain economic outlook, there is now an expectation from clients that trustees will review performance and exposures more frequently and take swift, decisive action if needed.

Once trustees have drafted investment policy statements (IPS) with investment managers, client tolerance to risk has been assessed and target asset allocations created, trustees are in the best position to highlight any IPS breaches or style drift to their investment managers. Trustees that receive portfolio data daily can feed third-party alerts system that enable them to quickly flag any breached limits to their investment managers.

Timely data also enables them to more closely scrutinise performance, allowing trustees to quickly compare the returns of the trust portfolio against any pre-agreed relative or absolute benchmarks. Slow access to information makes it difficult for firms to track positions and transactions, monitor information in the event the level of exposure to a country or asset type needs to be known quickly. Such an agile view of the portfolio can also enable trustees to better manage cash and liquidity in line with client preferences.

Recently, there has been much greater scrutiny on the fees trustees are charged by their investment managers. A system that is updated automatically on a daily basis gives trustees much greater visibility of outgoing fees, so they can make more informed and timely decisions about manager selection against their performance.

Offering a scalable and personalised reporting experience

In an age where data volumes in the financial industry are mushrooming, clients don’t want to be buried by information. Instead, they are looking for actionable insights – useful, personalised analysis that makes sense of the data overload and presents easy-to-understand conclusions that can be applied in the real world. Whether that be in the form of a clear and digestible quarterly investment performance report or a thought-provoking balance sheet.

Timeliness matters too. We operate in a fast paced, increasingly real-time world, where outmoded data equals heightened risk and missed opportunities. Clients, especially the younger generations, expect the information they receive to be up to date. Tolerance for reporting delays and data inaccuracies is eroding fast. Technology can be the difference between having reports ready in near real time or waiting weeks after end of quarter for reports from consultants.

How can trustees implement new technology?

Trustees need a structured plan to implement technology. They should start by identifying their key challenges. Do they want to improve data management or gain near-real-time data portfolio data or automate reporting, or all three? After assessing and identifying their needs, they should assess their options for a viable software solution.

New call-to-action

Related Content

15 Dec 2021 | Asset Manager

The 5 must-have capabilities for managing the risk function in-house

So you know you need a robust, institutional-grade risk management capability to attract investor allocations and meet clients’ ongoing demands. But what does a fit-for-purpose risk management and reporting function entail in practice?

11 Jan 2022 | Asset Manager

The cost of meeting asset allocators’ risk management expectations

Implementing a fit-for-purpose risk management and reporting function is expensive. But for asset managers, the cost of sub-standard risk capabilities is even higher.

Related content

23 Sep 2022 | Buyers Guide

Choosing the Right Trust Reporting Software
In this guide, we'll help you identify the ideal platform for your trust.
Download guide arrow-read-more

22 Sep 2022 | Blog

Why technology is the future for trust investment monitoring
When it comes to investment monitoring, many trustees still rely on reports from investment consultants and the associated manual data consolidation and client reporting processes. Discover how technology is creating a better future.
Read blog arrow-read-more

6 Sep 2022 | Blog

The Top 4 Data Challenges for Trustees in 2022

Discover the underlying data challenges fuelling the adoption of technology by trustees.

Read blog arrow-read-more

18 Jul 2022 | Blog

How Sesame is Rewriting the Playbook for Trust Companies
Sesame isn’t just changing the game for trust companies; it’s rewriting the playbook. A complete redefinition of how fiduciaries create and deliver value, so they can create operational alpha and deliver exceptional client service for generations to come.
Read blog arrow-read-more

13 May 2022 | Blog

6 things you need to build investment reports that clients love

Through conversations with asset and private wealth managers our Client Operations Director, Kathleen Henrick, has identified six key requirements for creating investment reports that clients love.

Read blog arrow-read-more

5 May 2022 | Infographic

Five benefits to digitalisation for private wealth managers
The latest technology offers the ability to go above and beyond simply fulfilling administrative and legal duties, enabling firms to enhance their value proposition with a complete transformation of the client experience.

Discover the 5 key benefits of automating trust administration.
View now arrow-read-more

26 Apr 2022 | Blog

The path to automated trust administration: how to overcome the data management challenge
As fiduciaries start their journey to fully automated trust administration, there are multiple complex data challenges they must overcome. Here’s how firms can go about solving them. 
Read blog arrow-read-more

12 Apr 2022 | Whitepaper

Trusts and Technology: Private Wealth Management in the Digital Age
The competitive landscape is changing quickly for fiduciaries. Clients now expect a rich flow of timely information at their fingertips, and industry consolidation continues apace.

Automating trust administration is the answer. But the way many fiduciaries manage their data and reporting processes today is hindering their attempts at full digital transformation.
Download now arrow-read-more

17 Mar 2022 | Blog

Sesame Data: A one-stop-shop for your custodial data
Sesame Data takes on the most intensive parts of the data management process, without the need for a costly server-based system, increasing the quality of your data, streamlining internal processes, and empowering your team to focus on the high-value client interactions that fuel growth.  
Read blog arrow-read-more

1 Mar 2022 | Blog

5 reasons you need a wealth management API

As fast, sophisticated data management becomes business critical, what are the benefits data APIs can offer your organisation?

Read blog arrow-read-more

15 Feb 2022 | Blog

Cloud-based investment management software: 5 reasons you can’t afford anything else  

In a world of rising client, regulator and staff expectations, portfolio and risk management capabilities quickly become outdated. Cloud-based platforms offer the solution.

Read blog arrow-read-more

Discover the power of Sesame