Head of Middle Office
KBI Global Investorss
TSAM London 2017 Panellist, Michael Gray, Head of Middle Office at KBI Global Investors, shares his professional insights…
KBI Global Investors underwent some significant business change during 2016. How did this affect your role in the business?
To be honest, it was pretty much business as usual for us in terms of getting on with our day to day activities. The take-over activity was, of course, ongoing but the smooth handling of that process by the executive committee ensured that the business as a whole was able to get on with our goal of meeting and exceeding our clients expectations.
Oversight of the outsourcing process continues to be a key responsibility of yours. What challenges have you been facing in this area?
Oversight of KBI’s main service providers in the outsourced space is a key responsibility for me in terms of out Middle Office operations.
In a changing business environment with increased regulatory requirements and responsibilities, we must ensure we are actively and more importantly, accurately monitoring the provision of these services.
This can obviously start with a well thought out and (equally as important!) a workable Service Level Agreement (SLA) and can filter right down to weekly logs and calls and even daily discussion when relevant.
The challenges for us are to impart our requirements and expectations and to then ensure that these requirements become living and measurable activities. This is then followed by the need to continuously monitor the continuing existence and proper working of these activities.
How are the various regulatory directives – in particular MiFID II – impacting the middle office at KBI Investors?
Increased regulatory workloads are probably a fact of life now, and at this stage, everyone is aware that you need to be capable of meeting these in a manner that satisfies the various requirements whilst still ensuring the efficient running of the business.
In terms of MIFID II, we are actively monitoring the new Transaction Reporting requirements and are at present paying particular attention to the additional transactional data elements that will be required. We are liaising with various parties including outsourcing providers to ascertain how best KBI Global Investors can meet these requirements.
You mentioned that one significant project for 2017 will be the upgrading of the business’ PMS system. What stage are you currently at for this, and what measures are you taking to ensure this process is carried out successfully?
I am pleased to say that we are now nearing completion of the significant IT project we undertook in 2016 and 2017 to upgrade our PMS system and related applications. This involved implementing our PMS system on a new server platform and the migration of over 134 million rows of data to SQL across over 2,000 database tables.
All Middle Office applications were impacted in some way or other by the project so it has been a very significant project for our area. Our target live date is February 2017, and our test conversions have served their purpose in terms of having helped identify and iron out any issues that arose when these were being completed. We are confident that the detailed testing completed to date and the trial conversion runs will stand us in good stead.
Environmental, Social & Governmental (ESG) investing is becoming more and more popular with investors. How are KBI Global Investors responding to this, and what is their ESG strategy?
KBI Global Investors has a strong commitment to Responsible Investing (RI) issues, and has managed Responsible Investment strategies for more than two decades.
Responsible Investing at this firm began in part because of our original Irish client base, which required a faith-based approach to investing. As such, we implemented negative screens into our process as far back as the early 1980s, in order to incorporate various ‘ethical’ criteria such as humanitarian and animal welfare issues for our clients. Today, our investment process has evolved from the simple negative screens utilised for our original faith-based clients to a fully integrated, decisive commitment to Responsible Investing, serving endowments, foundations, and institutional investors across the globe.
We do not believe that Responsible Investing is a static process. In contrast, it constantly evolves to take account of changing investor preferences, and societal norms. We are continuously striving to enhance our RI policies, practices and products and we expect change to continue to be a constant feature of RI in the years ahead.