The ongoing development of AI will have more impact on adviser businesses than ESG over the next five years, new research from Downing Fund Managers has revealed.
Its study with advisers found nearly half (46%) believe AI and its potential to boost efficiency, provide more personalised insight and automation as well as helping with analysis will have the most impact on the sector over the next five years.
That is well ahead of the 28% who believe that ESG investing is becoming more important to investors and regulators and will have the most impact on the sector.
Just over a fifth (22%) believe regulatory changes and tougher compliance standards aimed at increasing transparency, reducing fees and protecting customers will have the most influence on the industry over the next five years.
Downing’s research found less than one in 10 (9%) believe fintech and the predicted growth of passive investing will shape the industry the most, while only 7% point to the growth of alternative investments and private markets.
Simon Evan-Cook, manager of the Downing Fox range of Funds of Funds says: “It’s fascinating how quickly AI has become such a major issue for advisers. It’s not hard to see how it could work in their world, particularly in helping to fill the advice gap.
“It also points to advisers worrying about rising competition from AI, and here we think good active products like Downing Fox will help in differentiating human advisers from the next wave of adviserbots.”
