The asset management industry stands at a pivotal moment. In 2025, regulatory change is not just a compliance challenge—it is a strategic opportunity. KPMG’s 15th annual Evolving Asset Management Regulation Report analyses over 200 regulatory developments across nearly 30 jurisdictions, offering a global perspective on the forces shaping the industry’s future.
Amid geopolitical uncertainty and sluggish economic growth, regulators are shifting from a purely defensive posture to one that actively supports growth and innovation. Across the US, EU, UK, and Asia-Pacific, policymakers are streamlining requirements, removing barriers to market access, and encouraging product innovation. The European Commission’s “competitiveness compass” and the UK’s growth strategy for financial services are emblematic of this new agenda.
For asset managers, this means a renewed focus on reviewing product suites, exploring new international markets, and leveraging technology to meet evolving client demands. The deregulatory shift presents opportunities, but also requires careful risk management to avoid unintended consequences.
Private markets have surged up the regulatory agenda. Authorities are enhancing frameworks to increase transparency, improve conduct, and introduce standards for loan-originating products. Supervisors are prioritising valuation governance, conflict of interest management, and robust client disclosures.
A key trend is the “retailisation” of private assets. Vehicles such as the European Long-Term Investment Fund (ELTIF), the UK’s Long-Term Asset Fund (LTAF), and new proposals in Singapore and Canada are opening private markets to retail investors for the first time. This creates opportunities for diversification and growth, but also introduces challenges around liquidity management, valuation, and investor protection.
The transition to T+1 settlement in Europe by 2027 is another major milestone. Asset managers must assess the operational impact and begin preparations now to ensure a smooth transition.
Digital innovation and AI are transforming asset management, from portfolio optimisation to client onboarding and fraud detection. Regulatory approaches to AI are diverging globally. The EU’s AI Act, Japan’s new AI legislation, and the US’s innovation agenda reflect different philosophies on how to balance innovation with risk management.
Supervisors are refining guidance on fund tokenisation, with Asia-Pacific leading the way through initiatives like Singapore’s Project Guardian. The regulatory landscape for digital assets is also evolving rapidly, with new frameworks in the EU (MiCAR), UK, US, and Middle East.
For asset managers, the imperative is to develop robust AI governance frameworks, pilot tokenisation initiatives, and ensure compliance with a patchwork of global rules. The risks of “AI washing” and regulatory divergence are real, but so are the efficiency gains and portfolio diversification opportunities.
Investor protection remains at the heart of regulatory agendas. New and updated conduct frameworks—such as Ireland’s revised Consumer Protection Code and the UK’s Consumer Duty—emphasise outcomes, accountability, and the treatment of vulnerable customers.
Disclosure requirements are being modernised and streamlined, with a focus on clarity and digital accessibility. Regulators are also exploring new models for delivering advice, such as the UK’s “targeted support” regime, to make financial guidance more accessible.
Financial literacy and fraud prevention are rising priorities, with coordinated international action against misleading “finfluencers” and scams. Asset managers are expected to embed a customer-centric culture, revisit product offerings, and ensure robust governance to meet heightened expectations.
Resilience is multi-faceted—encompassing financial stability, operational robustness, and the ability to combat financial crime. While prudential frameworks are stabilising, operational resilience requirements are intensifying. The EU’s Digital Operational Resilience Act (DORA), the UK’s operational resilience regime, and APRA’s new standards in Australia are raising the bar.
Asset managers must embed resilience into business strategy, supply chain management, and outsourcing arrangements. Regulatory scrutiny of AML controls is increasing, with new authorities like the EU’s AMLA set to play a direct supervisory role. The message is clear: resilience is not just a compliance issue, but a source of competitive advantage.
After years of rapid expansion, ESG regulation is entering a phase of review and refinement. The focus is shifting to simplifying disclosure requirements, clarifying fund naming rules, and aligning corporate reporting standards. The upcoming EU review of the Sustainable Finance Disclosure Regulation (SFDR) is particularly significant.
Geopolitical dynamics are prompting regulators to clarify the alignment of defence-related investments with ESG criteria. Meanwhile, new sustainability reporting standards are being rolled out in Japan, Australia, and the UK, with the IFRS Foundation tracking global adoption.
For asset managers, the challenge is to navigate regulatory divergence, avoid greenwashing, and leverage new data to inform investment decisions. The simplification of disclosure requirements offers efficiency gains, but uncertainty and complexity remain.
If you have any queries about the evolving asset management regulatory landscape, or would like to discuss how your organisation can respond to these changes, please contact our team. We’d be delighted to support your journey through regulatory change and help you unlock new opportunities for growth.
