Global Asset Management 2022: From Tailwinds to Turbulence
Our 20th annual report on the global asset management industry looks back at a long period of growth—and explores the changes that lie ahead.
In the middle of difficulty lies opportunity.
—Albert Einstein’s third rule of work
The wealth management agenda is getting more crowded—and the items on it more urgent. Net zero, crypto, personalization, and digitization are not merely arenas that leaders can simply consider. They are imperatives whose outcomes will determine which institutions grow client share over the next five years. The most important question facing wealth managers (WMs) right now is not which initiatives to prioritize—but how best to execute on all of them.
This is the question that my colleagues and I at Boston Consulting Group take up in our 22nd annual Global Wealth Report. Our chapter on market sizing proves that the industry—as diverse as it is globally—is more than up to the challenges facing it. Although not impervious to economic, political, and social events, wealth development is resoundingly resilient, demonstrating its ability to adapt and grow even in the face of massive systemic shocks.
But WMs that conflate resilience with complacence will be in for a rude awakening.
As our chapters on crypto and personalization make clear, wealth clients are in no mood to wait for next-generation offers and next-level service. They want them now—and they know that what they want is available—if not from their current WMs, then from others.
Far from setting off alarm bells, however, these findings have the potential to herald enormous growth opportunities for WMs that are ready to move decisively. Clients are eager to put their assets to work. And, as our chapter on net zero illustrates, many are motivated to propel climate transition and financial returns through novel net-zero investment themes and portfolios.
Proof that change is worth the risk comes from what might seem to be a paradoxical source, as our chapter on the digital value premium shows. Digital WMs have seen their valuations skyrocket over the past decade—and not just because tech is exciting. Fundamentally, it’s because digitization delivers what wealth clients want and what managers need: excellence in experience and excellence in execution. These businesses, often seen as competitors to wealth management firms, provide a helpful and scalable framework for success that traditional WMs can emulate. By picking up the pace of their own digital transformations, WMs can deliver on their expanded agendas, offer clients the solutions they want, personalize interactions, and drive sustained, above-average performance.
Roughly $80 trillion in new wealth will be created over the next five years. These are life-changing, career-changing, and world-changing sums. For WMs that are prepared to seize the opportunity, the blueprint for growth is there for the taking.
We hope our report provides food for thought on how WMs can plan and construct their future prosperity, and we look forward to continuing a dialogue with you.
Managing Director and Partner
Global Leader, Wealth Management