Despite anticipating increased use of GenAI in 2024, only 1 in 5 Asset Managers feel confident in their ability to utilize the technology: KPMG Asset Management Industry Survey

Access to capital, talent seen as top risks

Asset managers see a greater role for Generative AI (GenAI) in their work, yet a dichotomy exists between expectations and comfort in using the technology. Thirty percent of asset managers believe GenAI will be used for 5-20% of tasks by the end of 2024 yet only 1 in 5 feel sufficiently knowledgeable in its use, according to the KPMG Asset Management Industry Survey.

"Generative AI presents a tremendous opportunity for asset managers to approach their operations in new and transformative ways that are still being fully understood,” said KPMG’s National Sector Leader for Asset Management, Greg Williams. “However, closing the skill gap in the use of GenAI is a concern that must be addressed to fully realize its benefits.  In the upcoming year, asset managers must prioritize both the adoption of emerging technology and the development of their talent pool to stay competitive."

The survey features insights from over 170 industry executives providing their views on some of the key challenges and strategic initiatives within their industry.

Key Survey Findings Include:

  • The availability of capital to fund growth was cited as the top risk factor heading into 2024 by 40% of respondents.
  • Additional concerns from an operations standpoint included talent risk (including leadership, the ability to recruit and retain talent, and cultural issues) along with geopolitical risk and political uncertainty, at 34% and 33%, respectively.
  • When asked which asset classes are anticipated to offer the greatest returns within the next three years, respondents chose private debt (39%) and private equity (38%) as the top two asset classes for ROI. This was followed by traditional asset management (equities, bonds, ETFs) at 23%, real estate at 22%, and hedge funds at 20%.
  • Asset managers are trending toward having employees back in the office at least some of the time with 67% saying their organization is operating in a hybrid environment, 26% stating they are back in the office five days a week, and only 6% seeing fully remote as an option.

“Asset managers are less concerned with the level of the rate environment and more so with the varying trajectory and timing of rate cuts. A stable market signals to them a favorable environment for transactions to be made,” said KPMG Senior Economist, Yelena Maleyev. “In addition to monetary policy, other factors such as talent are of concern. Those who are able to navigate the myriad of short-term challenges facing the sector while maintaining their long-term objectives will be best positioned going forward.”

About the survey:

KPMG LLP (KPMG) conducted a survey between November and December of 2023 (prior to the December 13 Federal Open Market Committee meeting), to obtain insights on both economic and strategic initiatives heading into 2024. Responses were collected from over 170 asset management professionals in the U.S., primarily in c-suite and board roles, representing private fund managers, traditional fund managers, publicly traded entities, and institutional investors, investing across various asset classes including real estate, hedge funds, private debt, and private equity; a majority with $2.5 billion or more in assets under management (AUM).

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For media inquiries, contact Terra Kliwinski at tkliwinski@kpmg.com.

 

 

 

 

 

 

 

 

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