Key Developments in Private Funds and Investment Management for 2024: A Horizon Scan

The second edition of the Horizon Scan for 2024 has been released, highlighting key recent and expected funds, regulatory, and tax developments that will impact the private funds and investment management sectors. This edition is specifically aimed at fund managers based in Europe and includes cross-border content on US sustainable finance issues, among other topics.

One of the key themes discussed in the Horizon Scan is the focus on sustainable finance and the regulatory efforts to combat greenwashing. With pending overhauls and possible introduction of labelling regimes under the Sustainable Finance Disclosure Regulation (SFDR), fund managers are facing challenges in compliance with existing frameworks. Additionally, the US SEC’s climate disclosure rules are creating uncertainty, adding to the complexity of regulatory requirements in this area.

Another important theme highlighted is the “retailisation” of investments that were previously only available to professional investors. The UK and EU are making efforts to reduce investment barriers and drive interest in long-term illiquid assets, such as the Long Term Asset Fund (LTAF). However, obstacles remain in terms of liquidity mechanics and cultural shifts required for retail investors to participate in these investments.

The Horizon Scan also delves into the implications of the recently finalized AIFMD2, particularly in relation to loan origination by alternative investment funds (AIFs). The new provisions clarify the rules around loan origination and the role of AIFMs in facilitating lending activities.

Overall, the Horizon Scan provides valuable insights into the upcoming developments and changes in the private funds and investment management sectors. Fund managers are advised to stay informed and seek advice to navigate the complex regulatory landscape effectively.

For more detailed information, you can access the full Horizon Scan document and listen to a podcast discussing the key themes of this edition. Goodwin plans to continue updating the Horizon Scan periodically to keep stakeholders informed about the evolving regulatory environment.