mast image

Impact Investing

IPE special report May 2018

Sections

State Street’s Logue says winning client trust essential for service providers

GLOBAL – As the trend towards outsourcing continues, service providers will not win business based on products, but rather on reputation and trust, says Ron Logue, president and chief operating officer at State Street.

While it has been common for investment management houses to outsource their back office activities, an increasing number are now looking to outsource parts of their middle office activities, such as performance measurement, compliance, risk management, trade support. This opens up a wealth of opportunities for global service providers, but focus will not be on products.

Says Logue: “We all provide good products, but it’s not about that. What a client wants to know is: Can we trust this provider? Can they be a partner? Will they still be here in six months time?

Winning such trust is essential for those service providers who wish to succeed. While companies know well that outsourcing can increase efficiency and cut costs, the trend towards outsourcing remains gradual due to nervousness about handing over control to a different party.

Logue believes that the trend towards outsourcing will result in a consolidation of the custody industry, with the middle players struggling hardest to keep their position.

Commenting on State Street, Logue said that increasing market share was still a focus. In particular, he sees France and Spain as areas of potential growth.

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2436

    Asset class: Real Estate - Core Open-ended Real Estate Equity Fund (non-listed).
    Asset region: Asia Pacific.
    Size: Approx. CHF 70-100m per investment.
    Closing date: 2018-05-25.

  • QN-2438

    Asset class: High Yield Bonds.
    Asset region: US.
    Size: USD 300 million.
    Closing date: 2018-05-25.

  • RE-2441

    Closing date: 2018-05-31.

Begin Your Search Here