Mastering Client Services and RFPs for Institutional Investors

April 01, 2022

By Elana Margulies-Snyderman

The request for proposal (RFP) process has transformed over the last few years. Institutional investors are asking investment managers more questions on diversity, equity and inclusion (DEI) and environmental, social and governance (ESG) and managers are increasingly leveraging technology to automate their responses to the questions asked.  At the Foundation Research Associates (FRA) 7th Annual Mastering Client Services and RFPs for Institutional Investors conference, which took place at New York City’s University Club March 28 and 29, industry professionals shared their insights on some of the latest RFP trends including effective ESG and DEI strategies, the importance of technology, robust cybersecurity measures and more. In addition, panelists share their insights for how employees can develop a successful career in RFPs.

Here were a few themes discussed:

RFP Trends:

  • RFP questionnaires have begun to include more questions about how firms are integrating ESG and DEI.
  • Technology is becoming increasingly important in streamlining the RFP process and many investment managers have turned to an outsourced provider to streamline both their RFP and due diligence processes. However, it is important managers have dedicated RFP personnel to verify that the automated processes are accurate.
  • Investment consultants continue to play a crucial role in both accepting and rejecting RFPs.

Developing Effective ESG and DEI Strategies:

  • As investors across the globe are placing more emphasis on ESG and DEI in the RFP questionnaires, fund managers need to be prepared to accurately measure how they integrate them both at the firm and portfolio/investment levels.
  • Investors across the globe interpret the ESG components differently so what the “E” means to an investor on one continent might differ to an investor on another continent.
  • Firms can enhance their DEI strategies by not only embracing diverse talent but also offering internships to underrepresented populations to pave the way for the next generation of leaders in investment management.

Robust Cybersecurity Measures:

  • With the ongoing Russia-Ukraine situation, the SEC’s proposed rules to increase cybersecurity transparency and an increasing number of firms falling victim to bad actors, cybersecurity continues to be an ongoing concern for fund managers and investors and RFPs have the potential to be hacked.
  • Therefore, it’s crucial firms set the tone at the top so leadership can emphasize the importance of cybersecurity education and training to employees to identify phishing attacks and other cyber hacks.
  • Firms are also encouraged to have a dedicated cybersecurity C-level executive or outsourced managed service provider (MSP) to assist with cyber functions, along with have an incident response plan and ensure its insurance policy covers cyberattacks.

Launching a Successful Career in RFPs

  • Amid the Great Resignation, it’s no secret that it’s hard to retain talent in the RFP space with long hours, extensive due diligence questionnaires and demanding responsibilities.
  • The panelists urged that beginning a career in RFPs will be a great place to learn as much as possible about investments and more and the skills they gain as an RFP writer can be transferred to another part of the firm to lower retention.
  • Finally, the panelists emphasized RFP professionals sign up for trainings or workshops on topics of interest to them and finally, celebrate the “wins.”
About Elana Margulies-Snyderman

Elana Margulies-Snyderman is an investment industry reporter and writer who develops articles, opinion pieces and original research designed to help illuminate the most challenging issues confronting fund managers and executives.