Sam Turner – 19th June 2020
Returning to the office after Covid-19 (?)
As Covid-19 spread across the world, companies across the globe were forced to adapt to keep their workforce safe whilst also keeping their businesses up and running.
Companies that previously resisted working from home have had to implement WFH strategies on the hoof. Countries such as Japan where long hours in the office is part of the culture have had to completely rethink their work structures.
Companies have had to ensure that they have the right infrastructure and services in place to enable people to work remotely. They have also had to double their efforts to look after the wellbeing of their employees. This has been challenging for some companies with employees dispersed far and wide.
As governments begin to ease lockdown restrictions, business owners are asking themselves whether and when to bring people back to the office.
How have hedge funds coped logistically?
The majority of hedge funds in the UK were able to adapt very quickly as Covid-19 took hold. Larger hedge funds seemed to be a step ahead of the government, implementing Covid-19 response teams from as early as January. However, for smaller funds the long-term nature of the WFH model is putting a strain on operations. Operational considerations such as data security structures, communication infrastructure, as well as regulatory concerns
A significant area of concern has been where funds are reliant on services that have been outsourced to companies in juristictions outside of the UK. Investor relations have also been hampered.
Challenges of investor relations
The Covid-19 crisis has hit the hedge fund industry hard. Redemptions in March 2020 exceeded $85Bn, the highest since the 2008 financial crash. Some funds were positioned so that when the crisis hit their strategies plunged. However, other funds have been able to leverage off the unprecedented level of volatility in the markets, massively boosting returns. Regardless of this, the volatility in the markets has meant investor relations has never been more important. In-person meetings have long been valued for building strong relationships, being better for relaying complex messages as well as being preferred for the advantages for ‘reading a room’.
On-line conference calls have some way to go to be able to replicate the value of face-to-face contact. However, there is still uncertainly surrounding air travel, city transport systems as well as the fear of a ‘second wave’. In the current environment, returning to normal working patterns can only be viewed as a calculated risk
Sitting tight
Hedge funds in London have largely indicated that they will not be back in the office anytime soon. Some funds are looking at a gradual return of staff from Q4, yet according to the recent AIMA survey, 20% do not expect anyone to be back in the office until January 2021 .
Until then, teams will continue to work remotely. The industry responded responsibly and quickly as the crisis hit, and is taking an equally responsible approach to reopening their offices.