Rebooting the global asset management industry

Rebooting the global asset management industry 3 Contents Foreword 4 Acknowledgements 5 Executive Summary 6 Introduction 6 Research Issues 7 Research Method 7 Survey Highlights 8 Main Findings 9 Theme 1: New Challenges Are Coinciding with New Opportunities 12 Theme 2: Small Steps, Not Giant Leaps, Mark the Rise of AI and GenAI 13 Theme 3: Proof of Value Matters as Much as Proof of Concept 14 Theme 4: IncrementalismWill Likely Define Future Progress 15 Theme 5: Outsourcing Is Linked with Organic Growth at Lower Costs 16 Theme 6: Winning Models Will Combine the Best of Old and New 17 Theme 7: Reports of the Death of Alpha Remain Exaggerated 18 Theme 8: Investors’ Goals Will Not Change but Their Means Will 19 Current Challenges and Future Opportunities 20 Aims 20 Key Findings 21 Interrelated Challenges Have Emerged on Multiple Fronts 22 New Client Segments Are Set to Drive Organic Growth 24 New Asset Allocation Imperatives Are Set to Drive Change 26 The Industry Value Chain is Likely to Be Recalibrated 28 The rise of AI and GenAI 30 Aims 30 Key Findings 31 AI and GenAI Are Set to Be Game Changers 32 The Complexity of AI and GenAI is a Drawback 34 Back Office Outsourcing Targets Operational Alpha 36 Middle and Front Office Outsourcing May Be Slower 38 Capitalizing on the Great Wealth Transfer 40 Aims 40 Key Findings 41 From a Product-Centric to a Client-Centric Approach 42 The Cult of Active Investing is Alive and Well 44 Growth Engines Are Likely to Remain Somewhat Muted 46 Leadership, Culture and Talent 48 Aims 48 Key Findings 49 Business Leaders Are Challenging the Status Quo 50 Using Culture as a Transformational Tool 52 GenAI is Not Just a Tech Play but a People Play Too 54