In one of the first sessions of IMPower Fund Forum’s two day event this year in the Grimaldi Forum in Monte Carlo, Hermin Hologan, EMEIA Wealth & Asset Management Leader, EY, attempted to define seven trends that are shaping the investment management industry, along with his panel of Stefanie Drews, President, Nikko Asset Management, Fadi Abuali, CEO Goldman Sachs Asset Management International, Pete Cherecwich, President of Asset Servicing, Northern Trust and Darko Hajdukovic, Head of New Primary Markets, London Stock Exchange.
Hologan noted that 2022 was a difficult year for asset managers with a 23 per cent drop in revenue for the largest firms. While there has been a rally in assets over 2023, Hologan identified seven trends that post challenges and opportunities for the industry.
Technology, as an accelerator for business was his first offering, followed by ESG, which he said was facing strong headwinds; Product innovation in terms of responding to investor needs came next followed by cost transformation. The new phenomenon of private markets opening up to a broader group of investors is another trend that Hologan believes we will see more of in 2023. Ecosystems came next and then talent management.
Cherecwich commented on the growth in private market distribution, saying that organisations are finding the path through private markets easier to navigate and so that will continue to grow. Some 40 per cent of new fund launches last year were in the private markets, he said.
Hajdukovic also spoke on the subject, noting that the exchange’s role is to provide financing. “We are building solutions for private companies because you can’t have healthy public markets without healthy private markets.”
The exchange is building a crossover market, which will provide capital from institutional investors to a private company.
Drews, from Nikko, noted that in Japan, the most liquid market in the world, the investor group aged 18-25 gets its investment advice from YouTube or TikTok. “We are building products for them,” she said, noting that the delivery mechanism is changing.”
