DOL fiduciary rule will lead to increased spending on technology: survey

The Department of Labor's fiduciary rule is expected to increase the budget allocation of firms toward adopting technology to help them comply with new regulation, according to a recent survey of industry professionals. The survey, conducted by SS&C Technologies Holdings, Inc., a global provider of financial services software, said that 85% of investment professionals believe their firms will look to new technology as a way to deal with the new regulation. The survey found that 33% believe the allocation could be as high as 10-20% of their current budget. "While the industry is still digesting exactly how to adapt their businesses due to the DOL rule, it's undeniable that firms will need to evolve their advice models and their daily operations," Dave Welling, managing director and co-general manager of SS&C Advent, said in a statement. Client portal/document management capabilities lead the way in specific technologies that the firms will keep in mind to better comply with the DOL rule. Morningstar has already taken steps in that direction with the launch of a new client portal early last month. The adoption of new technology could also be driven in part by a belief that business goals aren't being met due to insufficient operational efficiency. In the survey, 28% of the respondents cited that as a major concern which keeps them up at night. More than three quarters of investment professionals expect the DOL rule to specifically impact policies, procedures and technology systems at their firms. The survey supports another report by Cerulli Associates, which said the DOL rule will push asset managers toward digital advice.