Implementing change

The convergence of increasing investor demands, regulatory pressures, and the operational burden of complex legal structures is pushing private markets fund managers to implement significant changes in data management, operations, and technology. To achieve this transformation, managers should consider the following steps:

Assess your current systems and processes: Conduct a thorough assessment of existing data management and operational systems to identify areas of inefficiency and potential risks. This assessment should include an evaluation of the current legal entity structures and their impact on accounting and reporting processes.
Invest in upgrades: Advanced data management and analytics platforms can streamline operations and enhance reporting capabilities. Fund managers should consider investing in technologies that offer scalability, automation, and integration capabilities.
Enhance expertise: Building expertise in tax law, regulatory compliance, and data analytics is crucial to manage the complexities of infrastructure funds. Ongoing training and development can help staff stay updated on the latest regulatory changes and technological advancements. Working with a partner can also offer the opportunity to add a diverse range of expertise or break your dependency on hiring the right talent.
Support stakeholder engagement: Proactive engagement with investors and regulators can help you better understand expectations and requirements. Regular communication and transparent reporting builds trust and improves investor relations.
Develop a comprehensive data strategy: A well-defined data strategy should outline how data will be collected, managed, and analyzed to support decision-making and compliance. This strategy should align with your overall fund goals and address investor’s specific needs.
Monitor and adapt: Fund managers will want to continually monitor and review their data management and operational processes. Being adaptable and responsive to changes can help maintain compliance and meet investor expectations.

A multifaceted approach

Scaling portfolio and data management for infrastructure investments requires firms to address the complexities of legal entity structures, accounting data, investor demands, and regulatory pressures. By leveraging advanced data management systems and implementing robust operational processes, fund managers can streamline operations, enhance transparency, and meet the evolving needs of their investors. As the investment landscape continues to evolve, embracing changes will be critical for the success and sustainability of infrastructure funds.