Update

The Expanding Role of the General Counsel in Asset Management 

As the asset management industry continues to evolve, the role of the General Counsel has become increasingly critical.
 
In this insightful article, Ben Dixon, General Counsel and Chief Compliance Officer at Systematica Investments - a leading quantitative investment management firm with over $11 billion in assets under management, explores the expanding responsibilities and influence of the General Counsel in the modern asset management landscape.

Ben sheds light on how this key position is navigating complex regulatory environments, managing risk, and contributing to strategic decision-making in an era of heightened scrutiny and innovation.

The “general” in the job title has never been so apt. The days when the remit of GC (and his legal team if he was lucky enough to have one) was solely to provide the business with technical legal advice are long gone. For the GC in asset management firms today, the role continues to expand far beyond its traditional legal boundaries and is increasingly ingrained in the structure of the wider business. In 2025, our remit spans not only regulation and litigation, but also complex structuring and fee negotiations, data governance, fee transparency, and enterprise-wide risk strategy. Legal leaders across the industry are operating in a landscape marked by intensified scrutiny, complex cross-border compliance, and accelerated innovation. Below are five issues that are currently front of mind for GC’s in the industry — and, increasingly, board-level concerns of asset management firms.

1. Regulatory Change and Compliance Infrastructure

Regulation has always been a barrier to entry for asset managers, where the complexity and scrutiny of ever-increasing regulation has led to increased legal and regulatory costs for managers, both in pure dollar spend terms and in time cost to the organisation. New waves of regulation continue to reshape the industry. In the US, the noise around the SEC’s (now defunct) private fund adviser rules drove significant concern and distraction for managers last year. In the EU, regulators are revisiting key provisions of MiFID II and AIFMD, particularly those relating to fund liquidity, marketing, and delegation. Recent ESMA publications have noted the increased cost to investors of this ever increasingly complex environment. 

As a result, legal departments are playing a larger role in compliance infrastructure design. Across the industry, many GCs are focused on improving the agility of their compliance frameworks — through technology, policy integration, and closer alignment with operations and IT teams. The expectation from regulators and also investors is not just rule adherence, but demonstrable, auditable control.

2. Fee Pressure, Transparency and Investor Disclosure

Fees and fee transparency continue to be a focus. The 2 and 20 fee model for hedge funds for example is no longer the norm and the asset management industry as a whole has seen management and performance fees generally in decline over the past decade, with investors citing perceived poor/under performance as making it harder for managers to justify higher management fees.  

Earlier last year, certain institutional investors sent an open letter to the hedge fund industry advocating the implication of cash hurdles in incentive fee arrangements across the hedge fund industry as a "best practice standard".

At the same time, regulators have made it clear that fee disclosure remains a key priority. Recent enforcement actions suggest increased sensitivity to ambiguity, inconsistency, or complexity in how fees and expenses are communicated to investors — especially in private markets.

Many GCs are undertaking firm-wide reviews of disclosure language, marketing practices, and reporting processes to ensure alignment. The legal risk lies not only in regulatory interpretation, but also in investor perception. Clear, consistent, and investor-friendly communication is becoming a necessary standard — and one where the legal function has direct oversight.

3. Complex Structuring/Cash Efficiency

Related to the above on fee pressure is the increasing requirement from investors for cash efficiency for their investments at a time when their portfolios may be imbalanced. Cash efficient structures have always been a requirement for the very largest investors – who often require segregated managed accounts (SMAs) for that reason – so they can deploy their capital across multiple manager allocations without the requirement to fully fund. Replicating this in a commingled structure has always been more problematic. In the past we seen structures utilising external formal leverage (but the cost of capital would preclude such structures currently) or running higher volatility (which is not always suitable for all investors). More recently we have seen so called “partly funded” structures offered whereby investors would collaterialise several commingled fund holdings with the same manager through a single holding vehicle. Thereby giving the investor access to more investment exposure with the same manager for the same initial investment.

GCs are therefore being required to come up with increasingly complex and innovative structures to meet these investor requirements. 

4. Cybersecurity, AI, and Data Governance

With rapid digitalisation and the adoption of AI tools across asset management, legal teams are addressing an expanding set of risks related to data, algorithms, and cyber exposure. In 2025, AI is no longer a novelty — it is embedded in research, operations, client servicing, and compliance functions.

That brings new responsibilities. Many GCs are drafting or refining AI governance frameworks that address explainability, training data risks, and model accountability. At the same time, cybersecurity readiness remains critical, with firms updating breach protocols, incident escalation plans, and regulatory notification workflows.

On the data privacy front, the patchwork of global rules — from GDPR to CPRA and China’s PIPL — continues to demand sustained legal monitoring of rule changes and coordination across jurisdictions.

5. Litigation and Whistleblower Risk

Litigation exposure is rising across multiple fronts. The SEC’s whistleblower programme, alongside rising investor activism and an increase in class actions, is contributing to a more litigious environment. Claims related to disclosure, ESG misstatements, fees, or operational failures are becoming more frequent — and more sophisticated.

In response, GCs are enhancing internal reporting protocols and investigation procedures. A common focus is on reinforcing “speak-up” cultures while maintaining clear lines between legal privilege, compliance findings, and HR issues. Preparedness — in terms of documentation, governance, and escalation — remains the best defense.

The Expanding Role and Required Competencies of the General Counsel

Across all five areas, one theme is clear: the GC now needs to be a commercial advisor as much as a technical legal advisor, and is therefore deeply embedded in enterprise risk management, product development, technology strategy, and cultural governance. The function is no longer reactive or siloed. Whether advising on regulatory exposure, designing AI policy, or presenting to the board, GCs are now key contributors to institutional trust and long-term value protection, both internally and externally with investors and regulators. As this scope continues to grow, so too does the need for clear prioritisation, cross-functional alignment, and a forward-looking legal strategy. The challenges are increasing — but so is the opportunity for legal leaders to shape how our firms adapt, compete, and lead.

About Ben Dixon

This article is provided for general information purposes only and does not constitute legal or other professional advice and should not be acted or relied upon as such. Professional advice appropriate to the specific situation should always be obtained. While every effort has been made to ensure that the information contained in this article is complete and accurate at the date of publication, Mourant gives no warranty as to the adequacy, accuracy or completeness of the information contained in this article and accepts no liability arising from any inaccuracy or omissions in or the use of or reliance on the information contained in this article.