KPMG 2024 Asset Management CEO Outlook

125

Asset Management CEOs

11

Countries

$500m

USD+ in review

The KPMG 2024 Asset Management CEO Outlook report is an in depth report that provides key insights from the 2024 Global Asset Management Outlook survey, offering a deep dive into the current state and future prospects of the asset management sector. With over US$120 trillion in assets under management, the sector plays a pivotal role in shaping the prospects of virtually every other sector. The report reveals that asset management CEOs are confident about the economy and geopolitics, suggesting a positive outlook for growth. Their keen interest in generative AI and digitization indicates a rapid pace of market transformation.

The report also highlights the challenges faced by asset managers, including talent gaps, particularly in relation to AI and climate, and concerns about cyber resilience and stakeholder trust. However, the most successful asset managers are those that take a holistic approach to these opportunities and challenges. It provides a detailed analysis of these issues, along with insights into the role of mergers and acquisitions, the impact of AI on talent and growth, and the importance of sustainability and climate in stakeholder expectations.

Download and read the KPMG 2024 Asset Management CEO Outlook report to gain a deeper understanding of the asset management sector.

KPMG 2024 Asset Management CEO Outlook

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Key findings from the research

73%

Of Asset management CEOs confident in the growth prospects of the industry
75%

of asset management CEOs say that generative AI is a top investment priority for their firm
71%

of respondents saying that a lack of talent could negatively impact their organization’s growth prospects over the next three years.
70%

say that – as confidence and trust in governments decline – the public is looking to business to fill the void on societal challenges.

What can investment leaders learn from the Asset Management CEO Outlook?

Bullish on growth

Asset management CEOs are largely optimistic about their industry's growth, with a majority expecting earnings to grow by 2.5% or more in the next three years. Workforce expansion is anticipated, with 89% planning to increase headcount. These CEOs are less worried about economic uncertainty and geopolitical complexities than their counterparts in other sectors. Mergers and acquisitions are viewed as a key growth strategy, although the appetite for large, impactful mergers has decreased.

Building on AI

Asset management CEOs recognize the crucial role of Gen AI in their growth and operational strategies, with 75% prioritizing it as an investment, a figure higher than other sectors. They anticipate returns on these investments within five years. Rather than causing job losses, they see Gen AI as a tool for workforce upskilling and process enhancement, including fraud detection and cyber attack response. Despite this, 60% express concerns about ethical issues like privacy and bias, and 83% fear regulatory barriers. Cybersecurity is a significant worry, with these CEOs expressing more concern than their counterparts in other sectors, yet only 34% feel ready to handle a cyber-attack, reflecting a drop in confidence from the previous year.

Bold on talent

Globally, asset management CEOs are focused on talent acquisition and retention, with 89% planning workforce expansion in the next three years due to concerns about talent shortage impacting growth. They are particularly worried about the retirement of the Boomer generation and the ensuing knowledge transfer gap. These CEOs face more competition for talent (34%) than other sectors (27%). To attract talent, strategies include enhancing ESG credentials (18%) and refocusing the employee value proposition (14%). They recognize the need for improvement in diversity and inclusion, starting at senior levels (77%). Despite expecting daily office attendance (70%) and rewarding office-goers, they do not plan workforce reductions with Gen AI adoption, but foresee role changes.

Balancing on ESG

Asset management CEOs are striving to align their ESG goals with investor expectations, acknowledging the need to address societal issues like inclusion, climate change, and social justice. They view the push for net-zero emissions as a growth opportunity, but fear the financial and positional risks of not meeting ESG targets. While 62% have fully integrated ESG into their business, only 45% are confident in achieving net-zero goals by 2030. Rapidly changing stakeholder expectations and operational challenges, such as technology gaps, complex supply chain decarbonization, and skill shortages, pose significant hurdles.

Asset managers recognize that the world is still global, but the nature of globalization is starting to look and feel different. Investment strategies increasingly reflect the geopolitical realities that asset managers face.”

Andrew Weir

Global Head of Asset Management (retired September 2024),

KPMG International

Methodology

The KPMG 2024 Asset Management CEO Outlook, part of the 10th edition of the KPMG 2024 CEO Outlook, is compiled from the views of 125 asset management chief executive officers, which was conducted between 25 July and 29 August 2024, providing unique insight into the mindset, strategies, and planning tactics of CEOs. All respondents have annual revenues over US$500M and a third of the total companies surveyed have more than US$10B in annual revenue. The survey included CEOs from 11 key markets (Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, UK and US) and 11 key industry sectors, including asset management. NOTE: some figures may not add up to 100 percent due to rounding. In the asset management research, the two largest sub-sectors were private equity (or special situations, private credit, infrastructure or similar direct investment strategies) with 22 percent of respondents and traditional asset management (primarily equities and fixed income) with 18 percent. The best-represented countries based on organizational headquarters are the US, the UK, followed by Australia, Canada, China, France, India and Japan.